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15 Mar 2023

Policies

UK in the world

Tom Howe unpacks Pillar Two of the AUKUS defence pact, which focuses on sharing advanced defence capabilities. He suggests that the lesser discussed element of the agreement promises to be just as significant both now and in the future, but only if the partners overcome the challenges around information-sharing and foster collaboration.

When Australia, the UK, and the US signed the AUKUS agreement in 2021, attention largely fell on the so-called Pillar One component of the deal; the agreement to supply Australia with nuclear-powered submarines.

Memorably, AUKUS created a major diplomatic incident with France, which saw its submarine supply contract with Australia cancelled and consequently recalled its Australian and US Ambassadors. The UK’s ambassador remained in place, with France’s Foreign Affairs Minister suggesting the UK was the ‘fifth wheel on the carriage’.

As Pillar One progresses, it’s worth paying closer attention to Pillar Two, which may be just as significant for the trio.

The second Pillar of AUKUS signals an unprecedented desire to share advanced defence capabilities. Announced in September 2021 and expanded in April 2022, Pillar Two covers eight focus areas, including undersea capabilities, quantum technologies, AI, advanced cyber, and hypersonics.

It is unique in its ambition to combine the capacities of the respective states and develop secretive cutting-edge capabilities through seamless co-development processes and technology transfers.

Although somewhat unclear, each partner appears to have their own reasons for pursuing the initiative. For the UK, it has a strong industrial logic as it provides markets for areas of UK specialisation. Pillar Two-related collaboration may also offer opportunities for the R&D activities associated with the £238bn 2021-2031 Defence Equipment Plan.

The objectives from the US perspective are wide-ranging. Still, some analysts have highlighted the US’s desire to acquire the niche capabilities that exist within the respective British and Australian industries.

For Australia, Pillar Two provides a route for the country to develop the advanced capabilities it feels it needs to protect Australian interests. Pointedly, this refers to relations with China, which have deteriorated significantly since 2018, after Huawei was banned from Australia’s 5G network and China imposed tariffs on several Australian industries following calls for an independent investigation into the origins of Covid-19.

From this perspective, there is an urgent need to develop deterrent capabilities. So, while Australia will see Pillar One-related submarines earlier than anticipated, acquiring capabilities over a much shorter zero-to-five-year timespan remains necessary.

However, the nature of the technology being shared presents significant and distinct challenges. The partners will need to collaborate across the development-production pipeline and shape the requisite bureaucratic, legal, and practical infrastructure to share information and technology seamlessly.

Here, they must move beyond bland statements about ‘safeguarding a free and open Indo-Pacific’ and properly clarify national ambitions to shape interaction and infrastructure. This will be important over the long term, where success will partly depend on bottom-up collaboration between industry and civil society.

Australia appears furthest along in this regard, having established a dedicated AUKUS team in their US embassy and held an AUKUS-related conference at the University of New South Wales in collaboration with King’s College London and Arizona State University.

Also encouraging are the British and Australian initiatives to create their own versions of the US’s Defence Advanced Research Projects Agency, which will connect, fund, and facilitate ground-breaking research and researchers. However, doubts remain regarding the British scheme.

Naturally, the technologies associated with Pillar Two will always require a degree of confidentiality. The challenge, then, is managing this without stifling collaboration.

The restrictions and controls associated with the US International Traffic in Arms Regulations (ITAR) are emblematic here. Australia’s Deputy PM recently noted that the restrictions associated with ITAR are currently blocking Australia’s ambitions to develop advanced capabilities. Moreover, such restrictions limit the UK and Australia’s commercial opportunities to export technologies jointly developed with the US.

There is a growing US consensus that these issues must be addressed. The US National Security Advisor, Jake Sullivan’s recent comments point to potentially positive developments. Nevertheless, any resolution is dependent on Congress and so somewhat uncertain.

Pillar Two’s success depends on the partners’ ability to resolve these issues and develop the necessary collaborative infrastructure. Should they achieve this, Pillar Two will expand the already exceptional Pillar One-related co-operation and underpin what has been described as a 100-150 year partnership, creating deep collaborative networks that impact the technological capabilities of the respective AUKUS militaries.

While comparisons to NATO are misguided, there is scope to expand AUKUS through Pillar Two to include other partners. Japan is commonly cited, although France and India have also been discussed. Yet despite an obvious logic, such expansion would compound the issues around information sharing.

For the UK, success in Pillar Two would further clarify the nature of the Indo-Pacific tilt. The debate regarding the tilt has focused on the credibility of British military involvement in the region.

However, alongside Monday’s decision and the inclusion of Japan in the Global Combat Air Program, success in Pillar Two would provide significant proof of concept for the tilt. It would demonstrate the hard edge (i.e., military-industrial) of the UK’s capacity to engage with regional partners without committing significant security resources – picking up on a theme discussed in the Integrated Review refresh.

A note of caution, though. While recent UKICE polling by Redfield & Wilton Strategies indicates that the US and Australia were ranked as the UK’s most important allies, voters regard alignment with the EU as equally important – making the Sunak-era rapprochement a worthwhile development.

Drawing these threads together and re-working an old metaphor, it’s increasingly plausible to discuss three circles of post-Brexit British foreign policy: the Anglosphere, Europe, and the Indo-Pacific.

Regarding the Anglosphere, there is consensus that the US remains the UK’s most important ally, and both parties are overtly committed to the AUKUS agreement. Thus, success in Pillar Two would strengthen the UK’s already strong relationship with core Anglosphere partners.

In Europe, the Ukraine crisis has re-emphasised the UK’s continental commitment and NATO responsibilities. Recently, there have also been moves to improve relations with the EU, which are currently at a post-Brexit high.

Finally, considering the Indo-Pacific, the UK is clearly focusing on deepening its engagement with the region, strengthening its relationship with partners like Japan and India while also looking to develop connections through its Dialogue Partner status with ASEAN and application to join the CPTPP.

By Tom Howe, researcher, UK in a Changing Europe. 

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