logo
He's a sceptic. So what might Colby recommend to Trump on AUKUS?

He's a sceptic. So what might Colby recommend to Trump on AUKUS?

Former Reagan administration official Hugh Hewitt didn't mince his words on the AUKUS nuclear submarine pact last week after it emerged Pentagon leaders wanted a guarantee from Australia that the vessels would be used to back the US in the event of conflict with China.
'Why, for example, would we help country A arm itself if country A would not render assistance in a fight?' Hewitt wrote on X. 'If we don't know what our closest allies are genuinely committed to do in the event of a crisis of the first magnitude, can we call them 'close allies'?'
His words received backing from the US Defence Department's chief spokesman, Sean Parnell. One of Parnell's bosses, undersecretary of defence for policy Elbridge Colby, is leading the Pentagon's review of AUKUS to see if it fits President Donald Trump's 'America first' agenda.
This masthead has reported Colby intends to urge major changes to the program, though the broader Trump administration is split on the best way forward.
Those changes could include calls for Australia to lease the submarines rather than buy them; have US crews on board the nuclear boats; or give some form of guarantee to deploy them in conflicts involving the US. So how would those work? And what would that mean for Australia?
Commitment to join a conflict
US officials say Chinese President Xi Jinping wants the ability to invade the self-governing democratic island of Taiwan by 2027, and defence experts say a conflict over the disputed territory is increasingly likely as China expands its military capabilities. China views the island as a wayward province and an internal issue for the country.
Colby believes Australia should provide some form of guarantee that US-made nuclear submarines will be used in a possible conflict with China, this masthead has reported.
Australia already has a mechanism to join the US in conflict under the ANZUS treaty. The pact was signed by Australia, New Zealand and the US in 1951 in response to the spread of communism in the Pacific and the rearmament of Japan after World War II.
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

Trump will be furious as China gatecrashes $35 billion party
Trump will be furious as China gatecrashes $35 billion party

The Age

timean hour ago

  • The Age

Trump will be furious as China gatecrashes $35 billion party

On Monday, after the period of exclusive negotiations for the consortium ended, Hutchison announced it remained in discussions with the consortium 'with a view to inviting (a) major strategic investor from the PRC to join as a significant member of the consortium.' 'Changes to the membership of the consortium and the structure of the transaction … will be needed for the transaction to be capable of being approved by all relevant authorities,' it said. It also reiterated previous statements that it wouldn't proceed with any transaction that didn't have those approvals. The key approval needed is, of course, China's. Hutchison is a Cayman Island-registered, Hong Kong-listed private business founded by Li via the acquisition of control of the venerable Hong Kong trading house, Hutchison Whampoa, in 1979. It has reduced its exposure to China and Hong Kong over the years and now generates only about 12 per cent of its revenues from Greater China. It has substantial infrastructure and telecommunications interests in Europe, North America and Australia, where it owns the container terminals in Sydney and Brisbane, a 25 per cent interest in TPG Telecom and a significant portfolio of energy and transport infrastructure assets. Loading At face value, it shouldn't have been particularly vulnerable to pressure from Beijing, but it has obviously bowed to that pressure, which has reportedly included a directive from Beijing to its state-owned firms not to deal with any businesses linked to the Li family. Li Ka-shing's son Richard's ambitions of expanding his insurance business into the mainland have apparently been stalled, if not blocked. The 'major strategic investor from the PRC' that Hutchison referred to in its stock exchange release is almost certainly the state-owned Cosco, one of the world's largest shipping and marine logistics companies. The buying consortium was told that if Cosco wasn't included in the deal the sale of the ports would be blocked. There have also been reports that Cosco is seeking rights that would enable it to veto any decisions by the consortium considered inimical to China's interests. Including Cosco in consortium will create another point of tension between the US and China. Not only does Trump have a fixation with the Panamanian ports, to the point that he has threatened an invasion of Panama to gain control of them, but his administration has taken aim at China's global leadership in shipbuilding and container shipping. The US is proceeding with plans to charge punitive fees on Chinese-built ships entering US ports; fees that start at $US18 per net tonne of cargo, or $US120 per container, that would increase incrementally over time. Trump's ambition is to rebuild the US ship building and shipping industries. The US builds only a fraction of a per cent of the world's large commercial ships and has no meaningful presence in the global cargo shipping market. The collision of interests between the two major powers over the ports sale was regarded as important enough for it to be raised at the trade negotiations the US and China held in Switzerland in May. When the deal, and BlackRock's involvement in the acquiring consortium, was announced, Trump hailed it as both a victory for America and a personal triumph. Trump isn't going to willingly allow a Chinese state-owned company to have a substantial interest and say in the operation of the ports in Panama. China, which sees influence over the ownership of ports and shipping logistics around the world as a critical component of its geopolitical strategies, isn't going to readily relinquish either its influence over Hutchison or, if Cosco is successful, an opportunity to gain a more direct stake in the ports. One possible solution raised is the carving out of the Panamanian ports from the larger deal, allowing US interests to control those ports while clearing the way for Cosco's involvement with the rest. That would, however, mean China would be relinquishing whatever influence it has today over the fastest shipping route between Asia and the east coast of America. The other would be that the deal falls over and the status quo prevails, although Hutchison, which stands to clear $US19 billion of cash from a sale, would see that as a major lost opportunity. Trump's trade wars and his new port charges for Chinese-built or operated ships will have massively disruptive effects on global supply chains and global port activity and container shipping volumes. Indeed, they are already having an impact, with container volumes at America's west coast ports falling away as his tariffs take effect. Loading The planned sale and exit from the ports was therefore well-timed and an example, if one were needed, of Li Ka Shing's business acumen. Now he and his family find themselves caught between the proverbial rock and a hard place, trying to sell highly strategic global infrastructure assets in the middle of a global trade war and a geopolitical struggle between the world's two major powers.

Trump's trade war: China muscles into Panama Canal ports deal
Trump's trade war: China muscles into Panama Canal ports deal

Sydney Morning Herald

timean hour ago

  • Sydney Morning Herald

Trump's trade war: China muscles into Panama Canal ports deal

On Monday, after the period of exclusive negotiations for the consortium ended, Hutchison announced it remained in discussions with the consortium 'with a view to inviting (a) major strategic investor from the PRC to join as a significant member of the consortium.' 'Changes to the membership of the consortium and the structure of the transaction … will be needed for the transaction to be capable of being approved by all relevant authorities,' it said. It also reiterated previous statements that it wouldn't proceed with any transaction that didn't have those approvals. Trump isn't going to willingly allow a Chinese state-owned company to have a substantial interest and say in the operation of the ports in Panama. Credit: Getty Images The key approval needed is, of course, China's. Hutchison is a Cayman Island-registered, Hong Kong-listed private business founded by Li via the acquisition of control of the venerable Hong Kong trading house, Hutchison Whampoa, in 1979. It has reduced its exposure to China and Hong Kong over the years and now generates only about 12 per cent of its revenues from Greater China. It has substantial infrastructure and telecommunications interests in Europe, North America and Australia, where it owns the container terminals in Sydney and Brisbane, a 25 per cent interest in TPG Telecom and a significant portfolio of energy and transport infrastructure assets. Loading At face value, it shouldn't have been particularly vulnerable to pressure from Beijing, but it has obviously bowed to that pressure, which has reportedly included a directive from Beijing to its state-owned firms not to deal with any businesses linked to the Li family. Li Ka-shing's son Richard's ambitions of expanding his insurance business into the mainland have apparently been stalled, if not blocked. The 'major strategic investor from the PRC' that Hutchison referred to in its stock exchange release is almost certainly the state-owned Cosco, one of the world's largest shipping and marine logistics companies. The buying consortium was told that if Cosco wasn't included in the deal the sale of the ports would be blocked. There have also been reports that Cosco is seeking rights that would enable it to veto any decisions by the consortium considered inimical to China's interests. Including Cosco in consortium will create another point of tension between the US and China. Hutchison's ports sale includes assets located in the Panama Canal. Credit: Bloomberg Not only does Trump have a fixation with the Panamanian ports, to the point that he has threatened an invasion of Panama to gain control of them, but his administration has taken aim at China's global leadership in shipbuilding and container shipping. The US is proceeding with plans to charge punitive fees on Chinese-built ships entering US ports; fees that start at $US18 per net tonne of cargo, or $US120 per container, that would increase incrementally over time. Trump's ambition is to rebuild the US ship building and shipping industries. The US builds only a fraction of a per cent of the world's large commercial ships and has no meaningful presence in the global cargo shipping market. The collision of interests between the two major powers over the ports sale was regarded as important enough for it to be raised at the trade negotiations the US and China held in Switzerland in May. When the deal, and BlackRock's involvement in the acquiring consortium, was announced, Trump hailed it as both a victory for America and a personal triumph. Trump isn't going to willingly allow a Chinese state-owned company to have a substantial interest and say in the operation of the ports in Panama. China, which sees influence over the ownership of ports and shipping logistics around the world as a critical component of its geopolitical strategies, isn't going to readily relinquish either its influence over Hutchison or, if Cosco is successful, an opportunity to gain a more direct stake in the ports. One possible solution raised is the carving out of the Panamanian ports from the larger deal, allowing US interests to control those ports while clearing the way for Cosco's involvement with the rest. That would, however, mean China would be relinquishing whatever influence it has today over the fastest shipping route between Asia and the east coast of America. The other would be that the deal falls over and the status quo prevails, although Hutchison, which stands to clear $US19 billion of cash from a sale, would see that as a major lost opportunity. Trump's trade wars and his new port charges for Chinese-built or operated ships will have massively disruptive effects on global supply chains and global port activity and container shipping volumes. Indeed, they are already having an impact, with container volumes at America's west coast ports falling away as his tariffs take effect. Loading The planned sale and exit from the ports was therefore well-timed and an example, if one were needed, of Li Ka Shing's business acumen. Now he and his family find themselves caught between the proverbial rock and a hard place, trying to sell highly strategic global infrastructure assets in the middle of a global trade war and a geopolitical struggle between the world's two major powers. The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store