Research Paper 1 1999-2000

Military Threats Versus Security Problems: Australia's Emerging Strategic Environment

Gary Brown
Foreign Affairs, Defence and Trade Group
24 August 1999

Contents

Major Issues

Introduction

A Strategic Survey

Factors Affecting Australia's Strategic Environment

Regional Developments Bearing on Australian Military Security Interests

Perspectives in Australian Official Strategy

Australia's Strategic Environment into the Next Decade

Endnotes

 Major Issues

This paper is about one central set of issues: what is the present and predictable nature of Australia's military strategic environment? Has that environment changed significantly since the end of the Cold War? Does it contain factors which might pose military threats to central national security interests? Is there any likelihood that Australia might need to commit the Defence Force to operations to support such interests? Recent decisions as to funding priorities within the Defence portfolio suggest that official thinking may be moving towards affirmative answers to some of these questions.

As the title of this paper implies, there is a distinction to be drawn between threats and problems. In almost any state's strategic environment there are always problems. These usually involve disputes with other countries, economic difficulties or political destabilisation in neighbouring states, with consequent difficulties such as a decline in trade, defaults on debts, refugee flows, the evacuation of Australian nationals from dangerous situations and so on. Though such problems may involve some use of the Defence Force (in evacuations, humanitarian aid or peacekeeping) they do not, however, directly threaten core Australian national security interests or imply that Australia may have to go to war to protect itself.

Military threats, however, may indeed require military action by the Defence Force. Therefore strategic developments or trends which imply potential threats need not just timely identification but clear distinction from problems as just defined.

In the strategic environment now emerging there are without doubt several significant problems, but it is less easy to identify potential threats.

Uncertainty is an ongoing strategic issue, frequently referred to by official and non-official commentators. Uncertainty, however, is merely shorthand for an inability to accurately predict future developments. As such it is always present, but of itself uncertainty neither supports nor degrades national security. It is, instead, an enduring factor for which due allowance must always be made. Its use to support a particular line of strategic thinking or projection is unlikely to be productive.

Naturally, strategic analysis and forecasting is always going to be an inexact art rather than a precise science. The Iraqi attack on Kuwait, for example, was not predicted. Nor was the Asian economic crisis, or (until the writing was on the wall) the fall of the Suharto regime in Indonesia. The most careful projections can be undone at a stroke by unforeseen or irrational conduct on the part of foreign states or leaders of relevant groups.

This caveat applies as much to everything in this paper as it does to any official strategic projections. With this in mind, it remains the conclusion of this analysis that while Australia faces a number of real or potential problems in its region, there is still-as has been officially acknowledged for several decades-no readily identifiable threat to Australian vital national security interests. If the Defence Force is to be involved in combat, it is more likely to be as part of a larger coalition operation (as in the Gulf War) where the objectives are not derived from Australian military security considerations but from less directly relevant foreign or economic policy considerations.

Introduction

In a survey reported in May 1999, it was revealed that a large proportion of Australians perceive significant threats to national security. Indonesia was seen as 'likely to pose a threat' by 62 per cent, China by 52 per cent, Malaysia by 37 per cent, Japan by 31 per cent and even Vietnam was seen as a potential threat by 24 per cent, almost a quarter of the population. These remarkable figures of course reflect nothing more than responses by non-specialists to simple survey questions, but they are testimony to an enduring characteristic of the Australian populace. National security planners, however, are obliged to go on more than 'gut feelings' or immediate reactions when considering the current and likely future strategic environment in which Australia must operate.(1)

To what degree does Australia face real or potential threats to its vital national security interests? Are any of the regional states capable, or foreseeably capable, of posing military threats to these interests? Is the undoubted instability and uncertainty apparent in some parts of our region likely to generate such threats? Has Australia's overall strategic position deteriorated since the end of the Cold War? Since the onset of the Asian economic downturn? These are the central questions this paper seeks to address.

In so doing it is inevitable that a range of other important issues will be largely neglected. Such issues include the growing trend towards multilateralism (even in security matters), globalisation, and associated debates on the future nature of warfare. Likewise it is true that a complete understanding of the military security environment necessarily involves consideration of the political, economic, social and environmental dimensions of security and of the complex interrelationships between them. (For instance, climate change may cause environmental disasters which require Australia to use the Defence Force to provide humanitarian aid, as in the Papua New Guinea drought of 1997-98). Neglect of these issues here is purely for reasons of space and focus, and does not imply that they are unimportant in their own right.

The central argument of this paper is that in the strategic environment now developing as the consequences of the Asian economic crisis work their way through the region, Australia may indeed see a number of problems emerge, but that few if any of these are likely to pose genuine threats to its central national security interests. Though the Defence Department and ADF (Australian Defence Force) and some analysts often-though as will be shown, not always-tend to interpret recent developments as requiring increased defence outlays by way of insurance, this paper suggests that such a course may be unnecessary. Nevertheless the government has diverted savings achieved through the Defence Reform Program (DRP) from the originally intended long-term force development to immediate enhancement of ADF readiness.(2) This is a signal that (failing additional injections of funds to permit both) the government believes that strategic conditions require current readiness rather than future development.

It will be apparent to readers that one of the difficulties confronting writers in this field is that information is not always available, nor always reliable, and that prediction of strategic changes is an art, not an exact science. Nevertheless an effort is made to assess levels of likely military threats to Australian security interests. But first it is useful to survey the radical changes in the global strategic scene which have occurred since the events which led to the abrupt end of the post-World War II Cold War era.

A Strategic Survey

The Global System Since the Cold War

New Freedoms, New Risks

The end of the Cold War, now a decade ago, was without doubt the most revolutionary (mostly) peaceful change to affect the international system during the present century. The sudden and largely unforseen collapse of one of only two predominant world powers led with swift inevitability to the end of the threat of global nuclear war. For Australia specifically, it meant the lifting of the threat of Soviet nuclear attack on installations vitally important to a superpower nuclear confrontation-North West Cape (missile submarine communications), Pine Gap (signals intercept) and Nurrungar (missile early warning)-but of greatly reduced strategic importance in the post Cold War world.

While freedom from the oppressive nuclear menace was a most welcome development (especially for the millions who had lived under its shadow for decades), it also meant the demise of a system wherein rival superpowers were able to coerce, control or at least strongly influence their allies or client states. This power was usually exercised by both Washington and Moscow so as to keep conflicts within bounds that did not threaten escalation towards global war. This was most noticeably the case in the Middle East where, despite some perilous moments (as in 1973), both Israel and its Arab adversaries were restrained by their respective superpower allies from going too far. Where global conflict was not likely, however, both superpowers were capable of unilateral military interventions against regimes or forces they disliked. This happened, for example, when the Soviets invaded Afghanistan to prop up a failing Marxist regime and similarly when the Reagan United States occupied the Caribbean island state of Grenada on thin pretexts and replaced its leftist government in 1983.

It was in the Middle East that the fundamentally changed nature of the 'new world order' was first demonstrated. This was not a 'world order' as meant by US President Bush, but a system in which states had much more freedom of action than under superpower tutelage. The unilateral Iraqi invasion, conquest and annexation of Kuwait in August 1990 was something which could not have happened during the Cold War, because the USSR, Iraq's superpower friend, would not have permitted an attack by one of its clients on an oil-rich state with strong ties to the West. To do so in (say) 1980 could have provoked a global crisis at least as dangerous as the Cuban missile crisis of the early sixties. Saddam's sudden aggression showed that there was a new freedom to act, while its disastrously unsuccessful outcome revealed that with this freedom came new risks. Iraq's recognition of the opportunity, and failure to manage the risks, between them reveal the true nature of a 'new world order' with only one superpower and a number of lesser but still formidable states.

Some Disputes Settled, a Few Deteriorate

The Middle East likewise demonstrates that with superpower rivalries removed some hitherto insoluble disputes can be effectively addressed. The peace process between Israel and the Palestinians, hesitant and riddled with fear and suspicion though it has been, has at least prevented any further outbreak of war and for all its deficiencies may yet deliver a workable long-term settlement. Similarly, the UN (and Australian) sponsored peace process in Cambodia could not have occurred while China and the USSR backed the Khmer Rouge and Vietnam, respectively, and although it has not brought stable democracy or even civic peace to the country, it has ended the civil war, did destroy the Khmer Rouge and produce a lower (though hardly acceptable) level of general violence. Again, the settlements in Namibia and South Africa itself, whatever their defects, represent significant gains. However, the continuing problems between India and Pakistan and the escalation of tension between Greece and Turkey (paradoxically both of these countries are still NATO members), show that not all problems are improved in the new environment and that some may actually get worse. Likewise, the ongoing violence in ex-Yugoslavia is something unlikely to have occurred under Cold War conditions.

Substantial Gains in Arms Control and Limitation, Some Reverses

The last few years of the Cold War saw Gorbachev's USSR conclude important treaties with the US and NATO. These agreements significantly limited the strategic and tactical nuclear arsenals of both sides and also controlled deployments of forces in Europe.(3) The recession of the risk of nuclear war as US-Soviet relations improved made these treaties possible, and their impact on both the ex-Soviet and US strategic nuclear forces, as well on as the formerly huge NATO and Warsaw Pact (mostly Soviet) armies in Europe, has been substantial.

Moreover, recognition of the dangers of weapons of mass destruction-whether with nuclear, biological or chemical warheads-has also led to the development of the Comprehensive [nuclear] Test Ban Treaty (CTBT) all five known nuclear states at the time, including both France and China, eventually signing. The Nuclear Non-Proliferation Treaty, which seeks to prevent new states acquiring nuclear weapons, was indefinitely extended in 1995. South Africa under Mandela admitted a nuclear program by the former racist regime and simultaneously announced its end, with the dismantling of such warheads as had been built under apartheid. And the Chemical Weapons Treaty, strongly sponsored by Australia, has helped contain the proliferation of the source materials for these devices. Finally, the Missile Technology Control Regime (MTCR), addressing the delivery system rather than the warheads, helps limit the spread of effective ballistic missile technologies.

The experience of several countries, including Cambodia and Afghanistan, with landmines left over from earlier wars created an impetus to ban these indiscriminate and long-lasting weapons. This came to fruition in Ottawa in 1997 with the conclusion of a protocol on mines and booby-traps. The US, however, having failed to gain certain exemptions, is not a party to this agreement, though many of its allies, including both Australia and the UK, have signed.

Against these gains must be set some losses and a number of ongoing problems. The recent Indian and Pakistani nuclear tests were a severe setback for nuclear non-proliferation, while the use of sarin gas by Japanese-based terrorists (who apparently tested their weapon in outback Australia and returned safely to Japan) showed how difficult chemical weapons control is going to be. There are also concerns about the real adherence of China to MTCR philosophies, while both North Korea and Iran have active missile programs and a disturbing willingness to trade in these technologies. Furthermore, the disarray of both the Russian military and the nuclear industry poses the threat of black market dealings in nuclear material or perhaps even in ready to use weapons. Certainly the case made by the Canberra Commission (a senior international panel sponsored by the Keating Government) and supported by the Middle Powers Initiative, that the complete abolition of nuclear weapons is not only desirable but actually practicable, remains in debate today.(4)

Even so, on balance arms control gains in the last decade significantly outweigh setbacks. One major but little noted gain was the drastic post Cold War contraction of the global arms trade-a reliable indicator of general (though of course partial) demilitarisation. Far fewer new advanced weapons enter service nowadays than during the Cold War: the emphasis is now on modernising and upgrading existing equipments and, unless they deal in surplus Soviet style materiel, many arms manufacturers and traders have found life less profitable. Certainly the new environment effectively derailed Australian plans developed under the Hawke and Keating governments for a significant expansion of defence-related exports.

New Roles and Challenges for the United Nations

During the Cold War the United Nations was almost wholly paralysed by the system of Security Council vetos. In the present era this is not so, and the UN has raised its profile accordingly. Yet it remains constrained by its constitution, and by the reality that in many cases it can be bypassed or ignored by any sovereign state with the necessary resources and resolve. While some see the modern UN as little more than a creature of the United States (this principally because of its sanctioning of the US-led war against Iraq), the reality is that while the US can prevent the UN from taking any action of which it does not approve, Washington cannot always gain UN approval for actions it wishes to take.

This has been demonstrated on several occasions, as in February 1998 when Washington wished to launch strikes against Iraq over obstruction of UN weapons inspectors but could not gain support from the Security Council. Of course, Washington could have proceeded without UN support but in the event decided that the political costs of so doing outweighed any likely gains on the ground. Indeed, following further Iraqi provocations, this judgement was reversed at the end of 1998 when the US and UK together, without UN support, launched substantial air and cruise missile attacks against Iraq in operation DESERT FOX. In the washup from these operations, however, the US has been unable to prevent the effective removal of the UN Inspections system in Iraq.

European Security: NATO's Surprising Persistence

In Europe the Warsaw Pact (almost literally) vanished at the end of the Cold War, removing the Iron Curtain division of the continent and-via arms control agreements noted previously-eliminating the confrontation between huge NATO and Warsaw Pact forces formerly poised for war. German reunification (inside postwar borders now accepted by Germany and, it would seem, by most Germans) has created Europe's single most powerful state, albeit one not without 'digestive troubles' following on the absorption of the depressed and backward former German Democratic Republic.

Significantly, however, German predominance is not such as to seriously disturb Britain (which is famous for its centuries-old policy of not allowing any state to dominate Europe), or even France and Poland (both of which have good historical reasons to mistrust Germany). This is so because careful postwar confidence-building between France and Germany and the postwar integration of the west European economy, as now expressed in the arrival of the 'Euro' as a common currency for some EU members, has effectively rendered traditional military aggression in the region pointless. Even neglecting the French and British nuclear forces-which do ultimately act as an underlying though now inessential deterrent to any revival of German aggression-the costs to any major west European state of old-style military aggression are simply not worth the conceivable rewards. Quite aside from lives and treasure wasted actually fighting, modern warfare-and Europe is a region wherein many high-technology weapons are deployed and manufactured-destroys important infrastructure and industry, rendering valueless for years to come the very assets being fought over. The destruction inflicted on Yugoslavia as a result of the 1999 NATO campaign over Kosovo illustrates the point.

As the need for this campaign shows, south eastern Europe of course is far less stable than the west. The Balkans historically are a cockpit of mixed nationalities and ancient rivalries. World War I started in former Yugoslavia, then part of the Austrian Empire. The Cold War kept a lid on the Balkans, but its end has unleashed dangerous forces there. Today much of former Yugoslavia remains a dangerous place to live, but-however distressing the scenes of 'ethnic cleansing'-there is little risk of events in the Balkans triggering a general European conflict.

The fall of the Warsaw Pact and then of the Soviet Union left NATO as an alliance without an enemy. It has taken NATO all the decade since then to begin to reinvent itself as an instrument of European security. Its early hesitations during the breakup of former Yugoslavia seriously damaged its credibility, which was only retrieved later in the nineties when more decisive action was taken in Bosnia to halt continuing warfare and the accompanying 'ethnic cleansing' outrages. At the time of writing NATO, after an air offensive lasting 78 days, was finally able to impose a fragile peace in the Kosovo region, though Kosovo's ultimate status remains in doubt. Whatever the ultimate course of events there, it seems that NATO has confounded those who (like the present writer) initially believed that, bereft of its needed Warsaw Pact enemy, it would simply wither away. It is now a central pillar for the security of a large part of Europe, and is expanding to include some former communist bloc states. The Czech Republic, Hungary and Poland all joined NATO early in 1999.

Russia: the Sick Old Man of Europe

This expansion is not wholly to the liking of Russia, the main residual state of the former USSR. But (as the war in Chechnya shows) the Russian Federation is itself internally unstable. President Yeltsin's successive governments have one and all been hamstrung by ongoing conflict with a legislature dominated by an unwholesome combination of communists and extreme nationalists. More recently, the President's precarious health has become of real concern, leading to his apparent withdrawal from the day to day running of the country.

Russia is, moreover, economically impoverished as a result of stagnation under the Soviet regime, and still has decades of restructure and catching-up in front of it. It is a clear sign of Russia's greatly weakened international position that even the once powerful military is now far gone in decay: it is proving difficult to enforce the conscription laws, funds for exercises, training and maintenance are short, the troops are poorly and irregularly paid and there have even been reports of trainees starving in their camps.(5) Though Russian disapproval of NATO action against Yugoslavia has been forcefully expressed, it is clear that Moscow now lacks any real military clout with which to reinforce its diplomatic position. The very limited role conceded by NATO to Russian forces in Kosovo, and the inordinate rejoicing in Moscow at a minor and temporary coup (the seizure of Pristina airport) reinforces the point.

Russia's Security Council veto, inherited from the former USSR, and its continued maintenance of some nuclear forces-likewise a Soviet legacy-are really its sole current claims to great power, rather than mendicant, status. Nevertheless, the natural dismay and resentment among ordinary Russians at this precipitous descent from superpower status provides fertile ground for exploitation by extremist nationalists, unreconstructed communists and others. This may yet affect Russian policy in unhelpful ways.

New risks with nuclear weapons

The debilitation of the Russian military generates a particular concern. Former Soviet nuclear early-warning and command-and-control systems have been in part disrupted because key early warning stations are on what is now foreign soil (Latvia, for instance, promptly destroyed the installation it inherited) and even where not are not exempt from the resource starvation affecting all the Armed Forces. Key systems lack maintenance and necessary modernisation, their operators-including many with the 'finger on the button'-and support personnel are poorly paid and even that irregularly. Given that Russia still has almost 7000 strategic nuclear warheads, this is a serious matter.(6)

Removal of the threat of global superpower nuclear war may be the single most important result of the end of the Cold War, but this does not mean that nuclear weapons have ceased to be a factor in international affairs. The possibility of quite small states, or even terrorists, acquiring ex-Soviet nuclear weapons cannot be discounted, while the nuclear tests conducted by India and Pakistan in 1998 brought into the open a long-suspected subcontinental nuclear rivalry which had hitherto been kept one step away from full disclosure. Tests in early 1999 of potential long range delivery systems by both sides (Agni by India, followed by the Pakistani Shaheen and Ghauri II) did little to improve the situation. The outbreak of significant armed clashes at points on the Indo-Pakistani de facto frontier in disputed Kashmir likewise emphasised the fragility of peace in this volatile area.

Even though Indo-Pakistani rivalry is as old as the postwar partition of British India (1947), recent nuclear developments there are of particular concern when one factors in the post Cold War environment. With the world in a permanent state of superpower nuclear standoff, the risks associated with nuclear weapons use by a third party were very substantial. In particular, the danger of 'sucking in' the superpowers, so triggering a global nuclear war, was considerable. Thus, even though China, the UK, France (as declared states) and also (in high likelihood) India, Pakistan, Israel and South Africa were nuclear weapons states for some part of the Cold War period, either alliance considerations or the deterrent effect of the superpower standoff acted to restrain them. But the post Cold War environment lacks any such global deterrent effect. A state using nuclear weapons today no longer risks setting off a world disaster. This is not to say that there are no longer disincentives to the use of nuclear weapons, but the most potent disincentive of all disappeared with the Cold War.

Thus one is obliged to conclude that the price of freeing the world from the threat of global nuclear conflict has been an increased probability of nuclear conflict at lower, local, levels. This may involve terrorism, but more likely would be triggered by what one might call 'third string' nuclear powers. India or Pakistan, the erratic North Korean regime and some Middle East States (notably Israel and Iran), may at some time resort to nuclear weapons in war confident that, whatever the outcome, the conflict cannot escalate to global levels as was possible during the Cold War. Beyond this, however, one cannot safely predict the international consequences of such an act.

Focus on the Asia Pacific Region

The Cold War began in Europe as Stalin's USSR established itself by force as the dominant eastern and central European power. Europe itself lay in ruins in 1945 and it took massive US aid (through the Marshall Plan) to reconstruct the west. In their former empire the under-resourced Soviets did little to assist, but eastern Europe too was painfully rebuilt, albeit not to western standards.

But the foci of global power post 1945 were in Washington and Moscow, with divided Europe a bone of contention. Meanwhile the beginnings of a fundamental shift in economic power were underway in east Asia. Japan, rebuilt and demilitarised by the US and its allies after 1945, soon became an effective and self-sustaining economy. As the years passed Japan became the first east Asian nation to carry effective modernisation through to the point where it too became a global economic player in the same league as the US and western Europe.

While China languished in the grip of Maoist extremism, the nations of south east Asia, mostly decolonised after 1945, began to develop necessary political and economic infrastructure. Starting from a low base and long hampered by internal instabilities and insurgencies, as well as the long and bloody sidetrack of the Indochina conflict, it was not till the eighties that many of these states too began to approach the status of effective developing economies. GDPs per capita rose, and with them standards of living. Once China ceased to support communist insurgencies, the south east Asian states were able-albeit sometimes by methods which would be unacceptable in the west-to achieve a measure of stability based on increasing prosperity. By the late eighties it was becoming commonplace to think of the Asia-Pacific as the region of the future, with a relative decline in the importance of older developed areas such as Europe and the US. Though this did not remove the overwhelming preponderance of American military power, demonstrated so stunningly in the 1991 war against Saddam Hussein, it did foreshadow a time when Asian economic strength might be such as to support much more credible military capabilities. Even in the sixties and seventies, the inability of the US and its allies (including Australia) to defeat the insurgency in South Vietnam had raised the first questions as to the effectiveness in some circumstances of global US power.

The difference in the eighties and early nineties lay in the de-emphasis of traditional military power and the greater weight placed on the political consequences of economic strength. Though the late Chairman Mao's dictum, political power grows out of the barrel of a gun, was not invalidated in this period (as shown by e.g.,the Coalition war against Iraq and, ironically, the 1989 massacre in Tiananmen square), there was perhaps an addendum: political and military power require economic strength to flourish. As economic power shifted from older centres to the Asia-Pacific, there was a perception that in due course political and military power might follow. As Australia is part of this region, the strategic consequences were, at least potentially, matters deserving of close consideration in Canberra.

However, the onset in 1997 of a severe economic downturn in the Asia-Pacific region, with substantial effects in states like Indonesia, Malaysia, Thailand, South Korea (and exacerbation of pre-existing problems in Japan), necessitate a degree of rethinking and caution about the economic and thus politico-strategic influence of the Asia-Pacific. This matter is again addressed below.

Factors Affecting Australia's Strategic Environment

There are several factors which in concert help determine the nature of any country's military-strategic environment-the context in which it must conduct its security policies. These include: enduring factors (mostly geographic, but including the oft-cited uncertainty factor), economic factors, and technology issues, including access and ability to support technologies.

Enduring Strategic Factors

Geographic

The enduring nature of geographic factors requires no elaboration. While technological change can affect the significance of geographical factors-e.g.,the development of ships with engines instead of sails, or of aircraft-the factors themselves usually alter only on geological timescales (the only exceptions being large scale engineering works like the Panama and Suez canals).

Australia is an island. It has no land borders with any other state. Except in the Torres Strait region it is separated from its neighbours by an 'air-sea gap' hundreds if not thousands of kilometres wide. Because they make Australia difficult of access, these facts of geography provide long term national security support.

Likewise supportive is the fact that much of the Australian territory is extremely harsh. The most strategically exposed region-roughly, the northern third-is subject to monsoonal conditions which can render large tracts of land impassable for months at a time. The dry season produces extremely high temperatures and a serious water shortage, while as one moves towards the central regions of the continent rainfall is almost non-existent. Infrastructure, notably for surface transport, is very limited in many parts of the continent. Northern Australia is not a welcoming land for intruders; the Aboriginal people have indeed adapted to these difficult conditions, but over tens of thousands of years: despite their technology European settlers have always found the area treacherous and dangerous for the unwary. The not infrequent reports of tourists (even Australians from the urban centres) dying of thirst or heat after their vehicles break down testify to the unforgiving nature of much of the country. All of these facts, which can be obtained from any elementary geography text, must give any potential external aggressor food for thought.

But Australia's arid nature also means that much of the country is very sparsely populated. Vast tracts of territory feel human footprints only at long intervals. Effective monitoring and surveillance is very difficult, while (as discussed below) the low population base dictated by the arid terrain makes it practically impossible for Australia to field numerically large military forces. Likewise, the large distances between Australia and most of its neighbours and all of its powerful close allies impose lengthy lead times in acquiring support from external sources.

Australia's geographical location and nature make it harder to defend but disproportionately complicate the tasks of any aggressor. At the end of the day, Australia is under effective control by its government and only massive military force, on a scale all analysts (official or otherwise) agree to be almost impossible, could change this state of affairs.

Uncertainty

Forward projection of strategic environments-in plain English, predicting the future-is necessarily an inexact discipline. Thus, just as in (say) economics, even well-informed and competent analysts cannot reliably forecast the future course of events. At best, only trends can be forecast and even then forecasts can be seriously wrong. None of this is at all novel. Uncertainty is thus an enduring strategic factor which never goes away.

Nevertheless, some strategic analyses make much of the existence of 'uncertainty', tending to elevate it to a central principle or determinant. Yet to the extent that one emphasises the existence of uncertainty one is only confessing an inability to make useful operational or contingency plans and, moreover, admitting the inadequacy of whatever analyses have been done.

Ultimately the use of uncertainty to justify pessimistic strategic projections is a self-defeating exercise. Unknowns may equally turn out to be favourable. All one can really say is that there are always uncertainties in the business of strategic analysis, and that the appropriate caveats should therefore be entered whenever forward strategic projections are made. However attractive it may be in some circumstances, the use of uncertainties to support a particular line of strategic prediction is unlikely to be helpful.

Economic Factors

Australia's low population dictates that its economy can never match in size those of the much more populous developed countries in western Europe, Japan or the United States. However, the Australian economy is more or less as equally well developed as these others, albeit on a much smaller scale. It has advanced industrial and technological capabilities, it has innovative, educated and skilled people, it is a western mixed economy. But the intrinsically low level of domestic demand has always meant that the local production of some items has been relatively more costly than acquiring them from economies which reap the benefits of large scale production. Low local demand has also long encouraged many sectors of the Australian economy to look outwards, to export markets: Australia is a trading nation whose economic wellbeing depends to a large extent on its ability to import and export.

The combination of a low population base with a relatively small but advanced economy, all located on a largely inhospitable continental landmass, has virtually forced certain choices on Australian strategic planners. In particular, the long-term maintenance of large scale armed forces is not practicable. Achieved during World War II at massive economic and social cost, a mass force was, in the long run, unsustainable. Certainly in peacetime such options are unavailable. Even the (relatively) modest conscription schemes used in the fifties and sixties were terminated, and the cost of personnel alone today makes large scale conscription prohibitively expensive.(7)

This being so, Australia has had to find tradeoffs for personnel-intensive forces: the obvious, and only practicable, alternative has always been to rely on national technical and economic strengths to deploy forces whose firepower, mobility and effective command compensate for their relatively small size. Essentially, this implies a reliance on high technology, which in the present circumstances means embracing key elements of the so-called Revolution in Military Affairs (RMA)-precision ('smart') weapons, real-time intelligence dissemination to field commanders, information warfare and integrated command.

Technological Factors: all the Way with RMA?

Australia's (inevitable) choice to turn to technology as a solution to strategic problems posed by geographic and demographic considerations raises three key issues. These are: access to appropriate levels of technology, the cost of such technology and Australia's ability to support new technologies once brought into service.

Access

Though Australia has no mean record of technological achievement and innovation, it is true that we are unable in our own right to develop all necessary technologies, and even where we do, economies of scale often make local production prohibitively expensive. We are therefore obliged to acquire some high-technology items from external sources. Usually this means from the United States, Europe or Japan. Notwithstanding the official 'self-reliance' line taken by successive governments, Australia is in fact dependent on external (usually American) sources of supply and resupply for many of its key military hardware and software capabilities which are not produced or supported in-country.

In any event, our continued access to external technology is a critical issue, for without the high-technology edge, the Defence Force could lose a substantial degree of its credibility. This has indeed been a theme of some official analysis, and will be discussed later in this paper.

Cost

High technology nowadays usually implies high cost. This in turn imposes limitations on what technologies Australia can acquire even from willing and friendly suppliers. 'Leading edge' technologies-e.g.,in the current environment, US 'stealth' technologies for aircraft-are usually too costly to acquire. Decisions as to just where to place the tradeoff between the advantages conferred by possession of high technology capabilities and the opportunity costs in terms of other things foregone are among the most difficult confronting security planners in middle states like Australia. Australia cannot go 'all the way with RMA', but instead will need to pick and choose which capabilities to upgrade, which to maintain at lower (but still high) technology levels and which to avoid altogether. Only a superpower like the United States is capable of developing and introducing new technologies right across the capabilities board. Even countries like the UK, France or Germany must make careful choices about which aspects of RMA are affordable and sustainable, and Australian planning is already beginning to reflect this.(8)

Support

Finally, the support or replenishment of new technologies once acquired presents significant challenges. Some high-technology items (e.g. missiles) must simply be replaced from overseas as stocks are consumed or pass their safe shelf lives. Others can be repaired or upgraded but only at highly expensive facilities usually only available in the source country. Others again can be supported in Australia from local resources once the initial technology transfer has taken effect.

Even where the latter is true, support of high-technology items can be costly, not only in money terms but in terms of time-off-station for the equipment concerned. Most information regarding this problem is inevitably classified, but an extreme case from the US is illustrative. The B-2 'stealth' bomber requires 124 personnel-hours of support for every hour it flies.(9) Few if any advanced items in Australia's inventory would have so severe a ratio of support to operations, but ratios of ten, twenty or even forty to one could well be common. Clearly it will cost a great deal to maintain such items in effective operational service.

Regional Developments Bearing on Australian Military Security Interests

Here will be discussed the south west Pacific, south east Asia and north east Asia.

Papua New Guinea and the SW Pacific

PNG

Since achieving independence in 1975 Papua New Guinea, like most former colonies, has found full sovereignty a demanding responsibility. Troubled by political instability, separatism and economic weakness exacerbated by corruption, PNG is in essence a Third World state.(10)

PNG's geography supports its security. The country consists of half the island of New Guinea and several smaller islands. All are tropical and mountainous, and there are few roads. As Australia, the United States and Japan all discovered during World War II, the conduct of significant military operations in PNG is difficult in the extreme.

PNG does differ in certain important respects from many other similar states. Most significantly, it is the near neighbour of the former colonial power, Australia, which granted independence with a minimum of conflict, so ensuring that there would be no long legacy of bitterness and hatred stemming from years of struggle for freedom. In fact, unlike (say) French Indochina and the Netherlands East Indies, PNG and Australia share the military tradition of successful resistance to the Japanese during World War II. And, as that conflict demonstrated, PNG's geographical position makes its security one of Australia's vital interests. Its substantial reliance on Australian assistance gives Australia significant influence in Port Moresby. True, the occasional exercise of this influence has not always been welcomed, but ultimately PNG understands that its security interests and those of Australia are inextricably linked.

This recognition has been reinforced by another geographic factor: both PNG and Australia have Indonesia as a neighbour-in PNG's case with a long land border between it and the Indonesian province of Irian Jaya. More than once the OPM ('Free Papua') separatists of Irian Jaya have used PNG as a safe haven-something the PNG military is mostly powerless to prevent-and on occasion Indonesian forces have crossed the ill-defined border in pursuit of OPM guerrillas. At present one can only speculate on what will follow in Irian Jaya from the instability now afflicting Indonesia, with separatism rife not only in Timor but also the Sumatran province of Aceh.(11)

The course of the separatist war on Bougainville, where for nearly a decade Bougainville Revolutionary Army insurgents defied the Port Moresby government, revealed serious shortcomings in the training, equipment and discipline of the PNG Defence Force (PNGDF). As might be expected given the country's economic difficulties, the PNGDF cannot be financed to a level which might eliminate these shortcomings. Nor has Australian support for the PNGDF of itself been able to do so.

Though it imposes no formal military obligations on either country, the Joint Declaration of Principles signed by PNG and Australia in 1987 nonetheless symbolises their close shared security interests. It is probably not overstating the case to say that Australia, out of sheer self-interest, is obliged to defend PNG should the latter come under serious external military threat. However, though PNG's internal problems are serious, it faces no such fundamental threats. In the south west Pacific context PNG is now the most populous state (inclusive of New Zealand), and whatever spillover effects might accrue from Indonesia's present instability, attempted invasion or seizure of PNG territory is highly improbable, if not actually impossible.

South West Pacific

The smaller states of this region were briefly the focus of international attention late in the Cold War when the Soviet Union, taking advantage of exploitative fishing activities by US interests, began to cultivate good relations and port access in some countries (e.g.,Vanuatu). However, the subsequent Soviet collapse abruptly ended this phase and since then the south west Pacific has been left largely to its own devices.

After his 1987 coups, Fiji's Colonel Sitiveni Rabuka seems to have spent most of the following twelve years slowly and carefully undoing the principal effects of his ill-considered initiative. This ironic process came to full bloom in 1999 when Rabuka's government was defeated at democratic, racially unmanipulated, elections and replaced with minimal upset by a regime similar in many respects to that he overthrew by force in 1987. Fiji was perhaps fortunate that Prime Minister Rabuka became wise enough to see that the course set by Colonel Rabuka was steering the country towards isolation, racial turmoil and economic ruin.(12)

Several small states have suffered from occasional instability and outbreaks of violence. But, beyond purely diplomatic moves such as Taiwan's short-lived triumph with recognition from PNG, no external power has sought to capitalise on regional problems. There is in fact small incentive for doing so, and the difficulties of movement and communication in the vast maritime expanses of the Pacific act as an effective deterrent.

New Zealand

New Zealand remains a close ally of Australia, but its former alliance with the United States is now effectively dead and buried. Governments of both persuasions in Wellington have maintained the 1987 anti-nuclear legislation so distressing to Washington and show no sign of wishing to revise it. Nor is it likely that popular opinion would support such a move. For its part, with Cold War pressures now absent, Washington seems willing to accept New Zealand as a non-allied friend, and to conduct relations on a normal basis.

New Zealand has kept its defence budget, and thus the capabilities of its Armed Forces (AFNZ), low for over a decade. Australia has on more than one occasion expressed dissatisfaction with New Zealand's reduced military outlays, arguing that the country has a responsibility to contribute to regional security, but the priorities of governments in Wellington seem otherwise. Nor do these disagreements, or regular squabbles over trade issues, in any way affect the fundamental closeness of Australia-New Zealand relations.

In point of fact New Zealand knows that it is militarily very secure, and even more so since the end of the Cold War removed superpower competition as a factor in its region. Successive NZ governments have therefore drawn the appropriate conclusions as to the level of resources necessary for military purposes. If they have had any effect at all, Australian protests have probably only helped firm Wellington's view on this matter.

Australia's Asian Security Environment

In many respects Asia stands in sharp contrast to the south west Pacific. It is of course the home of billions of people, whereas the SW Pacific is but sparsely populated (Australia's eighteen million is by far the largest population in the region, but this is as nothing in an Asian context). Asia's sheer scale makes everything about it, difficulties included, loom large on the Australian horizon.

The Asian Economic Crisis

When the Thai currency suddenly came under market pressure in mid 1997, few if any thought that this heralded the onset of a serious economic downturn in the Asia-Pacific region. Yet within a few months market confidence in much of the region had folded and several currencies were severely devalued on world foreign exchange markets. Rapidly spreading through what now seem to have been overheated, ill-regulated, and occasionally corrupt regional financial systems, the crisis has brought to an end the era of unrestrained spectacular economic growth.

Because a number of regional regimes had been trading heavily on their economic successes prior to the crisis-often justifying authoritarian methods of government by pointing to significant economic progress-the abrupt slowing or turnaround of growth has had destabilising effects in some countries. Once currency collapses (and sometimes the attempted remedial packages imposed by the International Monetary Fund-IMF) triggered severe domestic price rises, governments which had justified their harsh methods by reference to economic gains suddenly found themselves in difficult positions.

Until two or three years ago references to south east Asia usually evoked images of countries whose governments were often undemocratic but whose economies were expanding fast enough to provide rising standards of living for most of the people. Criticisms from western states about human rights violations were parried by reference to the excellent economic statistics of the time. Most regional states prospered after the collapse of Cold War communist insurgencies, and their GDPs rose spectacularly. To give just two examples: Indonesia's GDP rose from $US67.1 billion in 1981 to $US119.9 billion eleven years later, an increase of nearly eighty percent, while in the same period Malaysia's GDP rose from $US25.6 billion to $US50.5 billion, almost double.(13)

All of this underwent a sharp turnaround after the Asian crisis began in 1997. According to the IMF, the Indonesian economy grew by only 4.6 per cent in 1997, contracted by 13.7 per cent in 1998 and was expected to contract by a further 4.0 per cent in 1999 with zero real growth expected in 2000. For Malaysia, the comparable figures were, 1997: 7.7 per cent growth, 1998: minus 6.8 per cent, 1999: under one percent growth and for 2000 three per cent growth. In Indonesia, consumer prices, driven upwards by declining foreign exchange rates, increased by 6.6 per cent in 1997, by over sixty per cent in 1998, and are expected to rise a further 28 per cent in 1999 and ten per cent in 2000.(14)

The social effects of sudden economic difficulties have been extensive, particularly in Indonesia, though Malaysia too shows some signs of instability. In Jakarta President Suharto, under whom the armed forces dominated Indonesian governments since 1965, was driven from office in May 1998 (he was succeeded by Vice-President B.J. Habibie) and democratic parliamentary elections held in June this year. However, there have been extensive social disturbances, both ethnic and religious, and it is clear that post-Suharto Indonesia is facing a difficult transition from authoritarian rule. The attitude of the armed forces to current developments remains opaque, uncertain and of critical importance to future developments.(15)

Likewise Malaysia has undergone some disturbances, though less severe, and the regime of Dr Mahatir remains in power despite internal conflicts which led to the sacking and subsequent show trial and jailing of former Deputy Prime Minister Anwar Ibrahim.

Other regional states have also faced difficulties, but none on the scale of those confronting Indonesia, and some indeed (e.g. Cambodia and Burma) have long-term 'home-grown' problems made more pressing by adverse international economic developments.

The dominant economy in north east Asia remains that of Japan, but since the early nineties Japanese economic growth has been faltering, and was not assisted by the recent Asian malaise. As the IMF records, Japanese GDP peaked in early 1997 and has been falling ever since (by 2.8 per cent in 1998 with a further 1.4 per cent drop predicted for 1999 and just over zero real growth expected in 2000.(16)

China has thus far not been greatly affected by the economic crisis: one of the great unanswered questions remains to what extent the Chinese economy can continue to be insulated from these external forces. Thus China has not yet felt any significant destabilisation arising from sudden economic downturns, as has happened in Indonesia. The regime, however, continues to downsize the bloated state employment sector, throwing millions of people into unemployment as subsidies are withdrawn, and consequent social problems (a rising crime rate is already apparent) may result. Whether recent attempts by Beijing to suppress a popular philosophical or religious movement, the Falan Gong, represent a sign of such problems is as yet too early to judge.

North Korea remains an island of exotic neo-Stalin 'personality cult' communism with a strong east Asian flavour. The economy is weak, and the country is unable to feed itself. Notwithstanding (or because of) this, the regime continues to pursue essentially isolationist policies, standing on its ideologically pure rock and conceding little. At the end of August 1998, under the guise of an attempted satellite launch, North Korea tested a ballistic missile, causing great concern in its region (especially in Japan), though it has yet to demonstrate any real ability to reliably deliver weapons of mass destruction over long distances.(17)

By contrast South Korea has moved successfully from authoritarian to democratic rule, and felt the impact of the Asian crisis early on, but appears to have weathered the storm more successfully than some other regional states. GDP grew by 5.5 per cent in 1997 before going negative (to minus 5.5 per cent) in 1998, but IMF projections have South Korea in growth (2.0 per cent and 4.6 per cent) in 1999 and 2000, respectively.(18)

Taiwan has felt the crisis perhaps least of the western oriented countries in its region. Growth has remained positive (though it dipped in 1998 and is expected to stay low in 1999) and is anticipated to continue beyond 2000.(19) Taiwan's principal external concern is of course always China.

Regional Military Capabilities in Asia

Until the onset of the present economic difficulties it was conventional wisdom that the armed forces of most east Asian states would be significantly modernised and upgraded in the coming decade. Indeed, a number of countries had already embarked on substantial upgrades of their defence forces.

The following table gives trends from 1989 to 1998.(20) It can be seen that there was significant real growth in the defence outlays of Malaysia, Singapore and Thailand in the first part of this period. In essence this growth was funded by the spectacular GDP growth achieved by most regional states in this period. The impact of the economic crisis is clearly visible in 1998.

Defence Expenditure in Constant 1995 $US billion-Australia and Comparisons

Note for Table

One state to which this assessment does not necessarily apply, however, is China. As noted, China appears to have been insulated, at least to some extent, from the worst effects of the Asian downturn, and continues to pursue the 'four modernisations' (in priority order, agriculture, manufacturing industry, science and technology and defence). China has increased declared defence outlays significantly in real terms (ie, even above the high inflation rates which have prevailed in recent years), while it is generally believed-though impossible to prove-that actual Chinese military spending is much higher than has ever been announced by Beijing.

But it is hard to make useful assessments of Chinese defence spending, let alone of whatever impact the Asian crisis may have on China's long-term program for military modernisation. The Australian Defence Intelligence Organisation (DIO), for example, has commented that 'there is simply insufficient reliable data to make worthwhile analyses'.(21)

At this stage adverse perceptions of Chinese intentions have been fuelled less by military modernisation plans than by Beijing's forward-though not militarily aggressive-policy in the South China Sea islands dispute and by bellicose gestures (missile tests and ostentatious military exercises) directed towards preventing Taiwan from declaring itself a fully independent nation.(22) Recent Taiwanese suggestions that their relations with Beijing are essentially 'state to state'-which implicitly denies the 'one China' doctrine and Beijing's claim to sovereignty over Taiwan-have again revived this issue. China has reiterated that it will not rule out the use of force to assert its claimed sovereignty.

One can understand the sensitivity of the Taiwan issue for China and of course it is this which drives Beijing's statements about the use of force. But the threat, if threat it be, is still largely an empty one. Most assessments suggest that the Chinese military has a long way to go before it will be capable of posing significant military threats in the east Asian region-certainly in the maritime environment away from China's coasts (including any putative attempt to reconquer Taiwan). Symbolic attacks on Taiwanese islands close to the Chinese coast could be mounted, but more ambitious operations appear unlikely. One recent assessment concluded that China's armed forces will not be able to conduct sustained force projection operations 'for at least a decade', that China has been forced to selectively modernise some force elements while leaving others in a primitive condition, that China cannot seize and hold territories in the South China Sea and that in any case economic imperatives 'will motivate civilian and military leaders to avoid conflict unless China's sovereignty is directly challenged.'(23) Another concludes that 'the vast majority of China's combat aircraft and navy ranges from obsolete to mediocre at best'.(24)

There can be little doubt that these truths are well understood by the Chinese leadership. This provides a realistic context in which to judge Beijing's threats of war against Taiwan in the event that the latter declares some form of independence.

The Chinese reaction to the accidental NATO attack on their embassy in Belgrade during the Kosovo conflict tends to support an assessment that Beijing is not, in the vernacular, looking for trouble. Naturally outraged by the destruction of their diplomatic premises and the deaths of several staff, Beijing nevertheless contented itself with a temporary suspension of some ongoing dialogues, demands for compensation, an apology, an explanation and the punishment of those whose errors caused the embassy to be targeted. President Jiang Zemin was 'unavailable' to speak to President Clinton by phone for several days, but eventually agreed to accept a call.(25) In July 1999 a visit to Beijing by US Secretary of State Albright signalled that relations were returning to a normal (for US-China relations) footing.

Japan's military capabilities remain constrained by the legacy of the 'Greater East Asia War'-Japan's attempt to conquer the region by force which ended in the nuclear destruction of Hiroshima and Nagasaki in August 1945. The US-imposed constitutional limitations on the Japanese military, though eroded at the margins by Cold War era pressures, remain an effective block to any expansion of Japanese military power. Indeed, there does not appear to be much popular support within Japan for any such expansion.

Thus the Japan Self Defense Force (JSDF), though technologically quite advanced and by no means negligible, remains essentially defensive in nature and lacks both any significant forward power-projection component or any capacity to sustain operations for extended periods. Japan is not presently capable of significant military aggression at present and is unlikely to become so in the foreseeable future. At the moment Japan's principal military security goal appears to be the acquisition of capabilities for protecting the country against possible ballistic missile attack from North Korea (no doubt with China or a revived Russia in the background). Far from contemplating active military operations abroad, the Japanese government is struggling to gain popular acceptance of deployments for purely humanitarian or UN peacekeeping purposes.

At the same time, and regardless of present economic problems, the inherent strength of the Japanese economy does provide Japan with the means to substantially expand and upgrade its armed forces if ever the political will and consensus for such a policy shift emerges. The fact that Japan is a potential, though not actual, military superpower is one which cannot be far from the minds of security planners throughout the Asia-Pacific region.

In the sixties and seventies several countries in south east Asia were fighting counter-insurgency wars against communist guerrillas (Indonesia, however, had killed most of its communists in 1965-66). But by the early eighties, the insurgencies had either been defeated or reduced to negligible significance (excluding the Philippines, where the communist insurgency fed off the excesses of the Marcos dictatorship until the regime fell in 1986, and still lingers today, sustained by resentment of grinding poverty and serious social inequalities). In the eighties, and for much of the present decade, military spending in south east Asia grew at high rates as armed forces were converted from counter-insurgency force structures to more conventional, and modern, inventories. This growth was funded by the spectacular economic expansion which most regional states enjoyed at the time.

However, the consequences for the military capabilities of most south east Asian states of the Asian downturn have already been sharply negative. Planned exercises and training programs have had to be curtailed. Declining exchange rates vis-à-vis strong currencies makes the acquisition of spares for existing equipment, let alone high-technology transfers for new systems, extremely costly. As a result several states have cancelled, curtailed or deferred planned defence spending, with some writers suggesting that their commitment to military expenditure plans announced prior to the crisis is increasingly 'theoretical'.(26) Even neglecting adverse movements in exchange rates, the negative growth of GDPs in states like Malaysia, Thailand and Indonesia has severely limited their ability to increase defence outlays even where expenditure is local rather than in hard foreign currencies.

Sooner or later, the present economic difficulties will pass away, but it appears improbable that the east Asian region will again record the kind of double-digit economic growth rates achieved in the preceding period. More modest future growth, however, may prove more sustainable and less susceptible to the spectacular 'bust' which terminated the previous growth period. Such growth, however, will not support the ambitious military expansion plans nurtured until the crisis began. Rather more modest military modernisation programs are likely once the region begins to grow again, and these will need to compete with demands from social and economic restructuring measures. This change has implications for Australia which will be noted below.

Regional Security Structures

During eighties and early nineties a number of multilateral bodies appeared, or were further developed, in the Asia-Pacific region. The best known of these is undoubtedly APEC (Asia-Pacific Economic Cooperation), but the most relevant in security terms is the ASEAN Regional Forum (ARF).

ASEAN itself (the Association of South East Asian Nations) has existed since the late sixties, but significantly increased its profile in the period of strong regional economic growth. Originally consisting of Indonesia, Malaysia, the Philippines, Singapore and Thailand, ASEAN now also includes Brunei, Burma, Cambodia and Laos and Vietnam.

ASEAN explicitly avoided the discussion of military security issues for many years. But by the late eighties it was generally agreed that ASEAN was successful, but that regional security might be improved if there were a forum in which regional security issues could be discussed, and where confidence-building could be fostered by increased contact and familiarity in a non-confrontational environment. In 1993 ASEAN sponsored the ASEAN Regional Forum (ARF) with a wide membership (not confined to ASEAN members-both Australia and the US are members, for example) as a non-formal mechanism for the discussion and possible resolution of regional security problems. Loosely structured and operating by consensus and consent, ARF has no spectacular successes to its name, but given its nature, such expectations would have been unrealistic. Its promoters had no such ambitions and the ARF, taken at face value, remains a useful tool for confidence-building and regional security discussions. Stresses-including simple resource problems-imposed by the Asian economic crisis have, temporarily at least, slowed the ARF's momentum.

Perspectives in Australian Official Strategy

Slow Reaction to Major Change

In the Introduction it was mentioned that Australia has tended to be sluggish in recognising significant strategic change. Certainly this was true at the end of the Cold War, when Australia was notably slow to recognise the strategic consequences for its region and itself. For over three years after the fall of the Berlin Wall the official position was that these changes did not require any significant revision of strategic policy. In September 1992 the then Minister for Defence (Senator Ray) wrote in a forward to Australia's Strategic Planning in the 1990s (ASP 90):

Not until the release of the 1994 Defence White Paper, Defending Australia (DA94), was there significant official recognition of substantial change. The same Minister who in September 1992 had claimed that Australia's strategic environment was unaffected, told Parliament in November 1994 that:

This represented a salutary, albeit belated, recognition of the real significance of post Cold War strategic developments. As noted in the Introduction, the present Government reacted quickly to the Asian economic crisis by commissioning a new strategic paper. That paper, however, has yet to be endorsed by Government or publicly released.

One recent report has suggested that the classified version of the 1997 strategic paper proposed some form of 'forward defence', even going so far as to claim that Australian combat forces might be involved in north east Asia.(29) The report, however, quotes very briefly and selectively from this classified document, and it is not possible (given the lack of context and the possible exclusion of important qualifying statements from the published material) to say whether or not the claims are accurate. However, a degree of caution seems warranted with respect to suggestions of very long range combat deployments, even with allies, because by the year 2000 the Defence Force will be as small in numbers as it has been for over thirty years, and will still lack the ability to sustain operations at great distances without massive allied support.

Ambivalence Towards the Region

Paradoxically, the growth in regional military capabilities which took place prior to the Asian economic crisis was apparently both encouraged and simultaneously distrusted by Australia. This ambivalence towards the region, though hardly new, was especially apparent in DA94. On the one hand, the White Paper said:

While this appeared to welcome the growth of regional military capabilities and the assimilation into local forces of more up-to-date military technologies, at another point DA94 drew quite different conclusions from these same developments.

Thus at one and the same time Australian policy was encouraging, even assisting, expansion of regional military capabilities while at the same time drawing negative strategic conclusions-a requirement for further ADF development-from the consequences. Such ambivalence is an expression of a more fundamental uncertainty which, in one form or another, has characterised official Australian strategic analysis for many years: is the region a source of potential threats, against which we need to take appropriate precautionary measures, or of opportunities, which we need to exploit in collaboration with other regional states?

It is also noteworthy that at times the Defence Force itself has expressed more sanguine evaluations of the strategic position than a stereotypical view of military planners might suggest. This became apparent when it was revealed that serious problems and delays in the Navy's Collins class new submarine project were going to have a major negative impact on the RAN submarine arm. In fact it has become clear that for a time Australia will have only one fully operational submarine, an ageing Oberon class boat, and that there is even a risk (if remedial measures for the Collins class are unduly delayed or fail) that submarine strength may temporarily drop to zero. When queried about this significant fall in ADF submarine capacity, however, the ADF responded that 'in the strategic circumstances that has been considered acceptable.' (32) This statement should, moreover, be weighed together with the view of the recent McIntosh/Prescott review of the Collins project, that these submarines represent 'probably Australia's most important strategic asset for the decades starting 2000'.(33)

Thus, notwithstanding suggestions from some quarters that recent changes have made the regional environment less secure, it is clear the professional military judgement is otherwise. Were this not so, the 'capability hole' represented by the Collins project problems would be viewed more seriously. At the same time, the instability in Indonesia is real, as is the Chinese sabre-rattling over Taiwan and the difficulties in the South China Sea. How is it then that Australia's strategic circumstances can be considered safe enough to tolerate a serious unplanned drop in a key capability? The answer lies in the distinction which should be drawn between threats and problems.

Australia's Strategic Environment into the Next Decade

Military Threats Versus Security Problems

Threats to the national security are an important issue requiring effective responses from Government. Such responses will most probably include-though not exclusively so-military options. Thus the identification, either of types of threat (what might be called generic threats-e.g.,of interference with Australian seaborne trade) or of specific threats (e.g.,that country X may interfere with our trade), is of central importance. Any regional development which credibly improves the ability of, or incentives for, a foreign power to take actions against Australian interests must be identified and appropriate countermeasures consistent with ADF capabilities planned.

As distinct from military threats, there are security problems. These might be categorised as adverse developments which do not improve the ability of regional foreign powers to take actions against Australian interests. For example, the ongoing instability in Cambodia, or that now apparent in Indonesia, represent regional problems for Australia but do not significantly increase the predictable level of threat. They may lead to action by Australia-even inclusive of an ADF deployment for humanitarian or peacekeeping purposes (as in Rwanda or Cambodia, respectively). While such deployments can be undertaken to support foreign policy or other objectives, and may yet be done at some point in East Timor, they are not required on vital national security grounds.(34)

But there is sometimes a tendency in strategic analysis to treat potential problems as potential threats. For example, should a country (hypothetically) destabilise and begin to disintegrate, it is immediately clear that there may well be some problems for its neighbours. Trade with the troubled country may collapse; there may be refugee flows in the form of 'boat people'; Australian citizens may be at risk and need to be evacuated. But equally it is clear that the armed forces of a disintegrating country will have more immediate concerns than aggression against (relatively) powerful regional states. The disruption of a regional state, though hardly to be welcomed, is far more likely to be a problem than the source of a military 'threat'-unless, of course, there are extraneous, possibly externally promoted, complications in particular cases.

Similar conclusions should be drawn from occurrences such as the Chinese refusal to rule out the use of force against Taiwan, or Beijing's staging of provocative military manoeuvres. While certainly unhelpful, and not conducive to regional confidence-building, these remain essentially declaratory or symbolic initiatives designed to place emphatically on record China's concerns about any general acceptance of Taiwanese statehood. Given the weaknesses of China's military outlined above, these threats, if threats they be, are empty. China, limited to small scale operations and symbolic demonstrations, is simply incapable of conquering Taiwan by force and will remain so for many years to come. In reality the ongoing tension between Beijing and Taipei is a regional problem, not a military threat, at least for the next several years.

Maintaining Australia's Technology Edge

As already discussed, there has been concern that the modernisation of some regional armed forces which began in the late eighties might erode the ADF's qualitative advantage. If China has a large but technologically backward military, Australian strategy for many years has been based on a small but high quality Defence Force. Potential erosion of the qualitative advantage, the technology 'edge', due to regional force modernisation programs prior to the Asian economic downturn accordingly gave rise to some concern.

But the matter is perhaps less simple than this concern suggests. It is erroneous to assume, for example, that regional countries can quickly assimilate new technology equipments, thereby substantially and rapidly increasing their military capabilities. There is actually much more to the effective use of modern weaponry and military equipment generally than its mere acquisition. Personnel must be thoroughly trained and appropriate high-tech support systems put in place. Spares must be readily available. Above all, the user force must develop a high-tech 'mind set' and easy familiarity with modern technological concepts, while extensive field experience (via combat or realistic exercise) is still an indispensable prerequisite. In Australia's region few if any states are as capable as is Australia itself of rapidly assimilating and bringing new technology weaponry into service. This continues to provide the ADF with an ongoing comparative advantage.

In any event, the growth of military capabilities in Australia's region-especially insofar as it involves the acquisition of high-technology systems from hard-currency supplier countries-is now significantly retarded due to the changed economic situation. As noted, many plans have had to be put on hold, if not abandoned, because regional governments no longer have the resources to acquire and support over long lifetimes costly high-technology weaponry or equipment. The assessment of DA94, that 'our planning recognises nevertheless that the recent trend of increasing military capabilities in the region will be maintained, and may accelerate', has been overthrown by subsequent events. Therefore, so long as it continues to develop its own forces at a measured pace, whatever fears Australia may have entertained of losing its military technology 'edge' over its neighbours no longer apply. From a strictly national strategic viewpoint, this check on the level of regional military technology is a positive spinoff of the economic crisis.

The Strategic Outlook

'Australia is one of the most secure countries in the world.' This was the assessment of Paul Dibb's Review of Australia's Defence Capabilities in 1986. Dibb justified this assessment by reference inter alia to Australia's geographical location and the limited military capabilities (especially in maritime power-projection) of Australia's neighbours.(35) These considerations remain valid today.

This is not to suggest that there has not been dramatic strategic change since Dibb wrote. Clearly there has been, and certainly the post Cold War environment differs radically from its predecessor. In some ways there have been significant improvements, notably the absence of superpower-sponsored conflict and proxy rivalries. On the other hand, the conduct of the North Korean regime remains dangerously provocative and neither the South China Sea dispute nor the Taiwan issue show any signs of resolution. To these difficulties can now be added the destabilisation of Indonesia and the lesser but still significant stresses placed on other regional states by the sharp economic downturn since 1997. Despite the end of fighting on Bougainville, Papua New Guinea remains economically weak and politically troubled, as do some other South Pacific states. Without doubt Australia's region has its troubles. And inevitably there is continuing uncertainty as to the future.

But judged by the yardstick of their capacity to generate credible military threats against core Australian security interests, no regional issue qualifies. There are indeed numerous problems, of varying degrees of severity, but none can be shown to include significant degrees of military threat. Militarily, then, Australia remains as Dibb saw it thirteen years ago: one of the most secure countries in the world.

This conclusion is not a license for complacency or wilful neglect of the ADF. But neither should Australia's foreseeable strategic environment be used to justify the allocation of substantial additional resources to defence. While