Bandits on the Silk Road? Implications of Eurasian cooperation
6 Feb 2018|

China’s Belt and Road Initiative (BRI) has been hailed as the world’s most ambitious development proposal, costing an estimated US$1 trillion. The BRI promises new railways, roads, ports, energy systems and telecommunications networks across Eurasia; Chinese officials have said that it’ll provide ‘excellent opportunities for countries to improve their network infrastructure with Chinese investment’. One of those opportunities, the Silk Road Economic Belt (SREB), involves constructing state-of-the-art trade and network infrastructure linking China, Iran and Russia—and possibly North Korea, following its surprise invitation to the Belt and Road Summit in May 2017.

Australia has been hesitant to join the BRI and to support increased interconnectivity between Russia, China, Iran and potentially North Korea—an implicit outcome of the SREB. Those four countries are among the world’s most aggressive cyber states, and each has executed advanced cyberattacks against Western targets. They’re also home to some of the world’s largest armies, and three of them maintain nuclear weapons. A coalition comprising these four countries could change the geopolitics of Eurasia and challenge the existing global order.

In the Worldwide threat assessment of the US intelligence community, Director of National Intelligence Daniel R. Coats specifically addresses each of these countries and summarises their aggressive posturing. Russia and China, empowered by their nuclear capabilities, have undertaken bold geopolitical expansions into Ukraine and the South China Sea; North Korea is realising its nuclear ambitions despite mounting international sanctions; and Iran has opted to avoid sanctions but remains nuclear latent under the Joint Comprehensive Plan of Action.

In the cyber sphere, we’ve seen Russian interference in the 2016 US presidential election, Chinese hacking of UK firms in 2017, Iranian hacking of US banks in 2016 and, most recently, the theft of South Korean military plans by North Korea.

In November 2016, China and Iran signed a military cooperation agreement and committed to joint military exercises. Trade between the two countries increased by 31% in the first half of 2017: ‘China is not only Iran’s biggest trade partner now but also one of the major investors in our country’, the Iranian ambassador to China told the media. China–Russia trade has enjoyed similar growth. And last July, President Xi Jinping said that bilateral relations with Russia ‘are now the best ever’ as he released three joint statements with President Vladimir Putin. Perhaps more disquieting was the content of those statements, which reflect ideological consensus and forecast increased military and security cooperation across Eurasia.

The growth in Chinese trade with Russia and Iran was greater than the average growth in Chinese trade with countries along the BRI routes, which increased by only 23% over the same period. An economically interconnected Eurasia is conducive to cooperation more generally, but the special emphasis China places on Iran and Russia could precipitate the formation of a coalition of Eurasian powers. That may extend to North Korea, which might gain indirect access to the SREB in exchange for denuclearisation.

The temperament and capability of such a coalition should worry Western onlookers. Each of the four states possesses advanced cyber warfare capabilities, restrained by no perceptible rules of engagement. Data fusion among these countries would rival the information-gathering capabilities we thought unique to our own Five Eyes intelligence-sharing alliance (the US, the UK, Australia, Canada and New Zealand)—albeit built on espionage, political and economic interference, and commercial theft. The global threat posed by this coalition, mutually emboldened, would be far greater than the sum of its parts.

This is possibly one worst-case scenario that the Australian government is grappling with, but it seems the British haven’t been so cautious. At the first Global Sichuan Entrepreneurs conference on the BRI in September 2017, I heard members of British industry express their unreserved support for the initiative during presentations from Chinese and Russian diplomats. The general consensus appears to be that partnering with China will ease Britain’s economic withdrawal from the European Union, while helping China transition into a more sustainable economy for the long term.

Western countries shouldn’t prioritise short-term gains over long-term uncertainty. Their ability to identify and suppress undesirable military and security cooperation in Eurasia will prove critical to the sustainability of such an investment. Australia would be unwise to follow Britain’s lead without safeguarding its long-term interests and understanding the full implications of the BRI.