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1 The International Institute for Strategic Studies The International Institute for Strategic Studies This content may be used for research and private study purposes. All rights reserved. Any substantial or systematic reproduction, redistribution, reselling, loan, sub-licensing, systematic supply, or distribution in any form to anyone is expressly forbidden. Full terms and conditions of use: SCROLL DOWN FOR DOWNLOADED CONTENT The International Institute for Strategic Studies, Arundel House, 6 Temple Place, London WC2R 2PG, United Kingdom. Incorporated in England with limited liability under number UK registered charity

2 12 th Asia Security Summit SINGAPORE, 31 may 2 JUne 2013 The Shangri-La Dialogue chapter 4 Military modernisation and strategic transparency third plenary session Saturday 1 June 2013, noon SPEAKERS Purnomo Yusgiantoro Minister of Defense, Indonesia Stephen Smith Minister for Defence, Australia Philip Hammond Secretary of State for Defence, United Kingdom

3 THIRD PLENARY SESSION Military modernisation and strategic transparency Purnomo Yusgiantoro, Minister of Defense, Indonesia Leading off the session, Indonesian Defence Minister Purnomo Yusgiantoro said that under its current military modernisation plan, defence spending in his country has risen to 1.3% of GDP, up from a low of 0.6% in 2001 after the Asian financial crisis. The 1.3% level will be maintained or even increased. Military modernisation is linked to military reform, based on principles of democracy and human rights. Military modernisation is also motivated by Indonesia s desire to play an increasing role in UN peacekeeping operations. One should be mindful, he added, of how inaccurate perceptions can create miscalculation, misjudgement and mistrust. Strategic transparency is thus needed in order to avoid a destabilising arms race. Transparency begins at home with an open and democratic system of government. Bilateral defence dialogues also serve transparency. In this regard, Australia s offer to consult neighbours in formulating its May 2013 Defence White Paper was a muchappreciated example. Non-governmental organisations, such as the IISS, also play a helpful role in enhancing transparency. In speaking of the need for strategic transparency, Australian Defence Minister Stephen Smith said military modernisation is a natural part of any country s economic development. Australia does encourage all countries, however, to be open about their defence policies, procurement plans and strategic intentions. The requirement for strategic transparency within the region applies to all countries, not only China. White Papers are an opportunity for governments to lay out their defence policies and postures and to provide assessments of their security environment. Australia s own Defence White Paper recognised the emergence of a new Indo-Pacific strategic arc, linking the Indian and Pacific Oceans through Southeast Asia. The alliance with the United States remains Australia s most important military relationship and has never been stronger, as reflected by the expansion of practical cooperation to cyber and space and the rotational training deployments of US marines to Darwin. 30 The Shangri-La Dialogue

4 Stephen Smith, Minister for Defence, Australia British Defence Secretary Philip Hammond said the UK is committed to developing closer economic, diplomatic and defence ties with countries across Asia. In an increasingly interconnected world and given the significant military modernisation being undertaken across the region, the UK has a strong interest in ensuring that increased military strength is used responsibly, in support of a rules-based international system. The sustained growth in China s defence budget is the most obvious demonstration of this process of modernisation, but China is not the only power upgrading its defence capabilities. The UK, too, is modernising its forces, supported by what remains the world s 4th largest defence budget. Among other capabilities, the UK will replace ballistic-missile submarines to maintain continuous at-sea deterrence with the Trident missile. This military modernisation is taking place within a context of multilateralism and transparency. Showing how it is possible to manage territorial disputes within a multilateral framework, the unresolved dispute over Gibraltar does not interfere with close cooperation between Spain and the UK in NATO and the EU. QUESTIONS AND ANSWERS Eight delegates posed questions. William Choong, Shangri-La Dialogue Senior Fellow for Asia Pacific Security at IISS Asia, asked how Australia s 2013 Defence White Paper would be characterised, given that the 2009 version was seen as a red flag directed at China. He also asked if Australia would still send naval forces to assist the United States in the event of a crisis involving the Taiwan Strait, as was stated by then Prime Minister John Howard in Finally, what role could the Five Powers Defence Arrangements (FPDA) play in future contingencies? Minister Smith said the new White Paper mapped out a coherent strategic analysis of not just Asia-Pacific, but the Indo- Pacific, from Hollywood to Bollywood. Reflecting India s growing role, an upcoming visit to Australia by Indian Defence Minister A.K. Antony would be the first visit of its kind. He would not comment on hypotheticals, but noted that the 62-year-old alliance with the United States had been invoked only once, in the aftermath of the terrorist attack on the United States on 11 September Regarding the last question, he could envisage future circumstances in which the FPDA could contribute to humanitarian assistance and disaster relief. Lieutenant-General (retd.) Noboru Yamaguchi of the Japanese National Defence Academy noted the tremendous strides made by the region in defence transparency over the past 15 years. He asked if the current regional naval build-up could be put to some cooperative purpose, such as in UN peacekeeping operations. In response, Pak Purnomo elaborated on several areas of cooperation among various ASEAN Third plenary session 31

5 Philip Hammond, Secretary of State for Defence, United Kingdom countries, especially under the umbrella of ADMM- Plus. Indonesia wants to become one of the ten largest contributors to UN peacekeeping, and is building a huge peacekeeping operations centre. Hammond commented that in the maritime realm, nations of the worlds have collaborated remarkably, including some very unlikely bedfellows in tackling maritime piracy off the Horn of Africa and in the Gulf of Aden. Commenting on Hammond s remarks about China s military modernisation, Senior Colonel Zhao Xiaozhuo from the People s Liberation Army Academy of Military Sciences said China spends only 1.3% of its GDP on defence, less than most other countries, including the UK, and that the PLA had neither fought an external war in 30 years nor deployed forces abroad, except for peacekeeping. Dr Chipman, as chair, noted that the IISS Military Balance assesses Chinese military expenditure against a number of indicators and offers forecasts of how Chinese defence expenditure might look in comparison with spending by other powers over the next years. Smith and Hammond echoed the need to look at other measures of defence expenditure. Hammond added that it is the rate of change that is potentially destabilising. As for force deployments, the long and current combat experience by UK forces allows Britain to deliver capability and usability out of proportion to the size of its forces. In response to a question from Admiral Edouard Dr William Choong, Shangri-La Dialogue Senior Fellow for Asia Pacific Security, IISS Asia Lieutenant-General (retd.) Noboru Yamaguchi, Professor and Director for International Programs, National Defence Academy Senior Colonel Zhao Xiaozhuo, Senior Researcher, Academy of Military Sciences, People s Liberation Army 32 The Shangri-La Dialogue

6 Admiral Edouard Guillaud, Chief of the Defence Staff, France Ristian Atriandi Supriyanto, Senior Analyst, Maritime Security Programme, S. Rajaratnam School of International Studies, Nanyang Technological University Ekaterina Koldunova, Deputy Dean, School of Political Affairs, Moscow State Institute of International Relations Guillaud, Chief of the Defence Staff of France, Purnomo said cyberspace defence was not yet a topic of talks within ASEAN, but probably would be in the future. Hammond commented on the increasing vulnerability of the satellites upon which so many military systems depend. Answering a question from Brigadier (retd.) Benjamin Barry, IISS Senior Fellow for Land Warfare, Hammond said he absolutely stood by the commitment that the UK s former defence secretary, Liam Fox, had made regarding doing more in the region. As an example, HMS Daring, a new Type-45 air-defence destroyer, is on its way to the Pacific to spend more than six months engaging in joint exercises and visiting countries in the region. He said this was a level of naval engagement that has not been seen for many years. Ristian Atriandi Supriyanto, Senior Analyst in the Maritime Security Programme at S. Rajaratnam School of International Studies, Nanyang Technological University, asked about implementation of the defence cooperation arrangement signed by Indonesia and Australia last year and when Indonesia planned to publish its next defence white paper. Pak Purnomo replied that Indonesia had joined the Pitch Black air force exercise in Darwin and that the White Paper was in the process of being updated, in consultation with neighbouring countries. In response to a question from Alexander Neill, Shangri-La Dialogue Senior Fellow for Asia Pacific Security at IISS Asia, Hammond said the Information Security Act (ISA) signed last year between the UK and Japan pointed to a step change in collaboration in both cyber-defence and defence equipment following Japan s changed policy position on defence exports and collaboration with other countries in the development of defence technologies. Ekaterina Koldunova, Deputy Dean of the School of Political Affairs at the Moscow State Institute of International Relations, asked if there were any plans for military or defence integration within ASEAN. Pak Purnomo replied that this was unlikely: ASEAN s founding fathers did not envision it becoming a military alliance and Indonesia, at least, had no intention of joining a military pact. Third plenary session 33

7 34 The Shangri-La Dialogue

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