Beyond the hype: Capturing the potential of AI and gen AI in TMT

Venkat Atluri, Peter Dahlström, Brendan Gaffey, Víctor García de la Torre, Noshir Kaka, Tomás Lajous, Alex Singla, Alexander Sukharevsky, Andrea Travasoni, and Benjamim Vieira

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The emergence of generative AI (gen AI) presents both a challenge and a significant opportunity for leaders looking to steer their organizations into the future. How big is the opportunity? McKinsey research estimates that gen AI could add to the economy between $2.6 trillion and $4.4 trillion annually while increasing the impact of all artificial intelligence by 15 to 40 percent. In the technology, media, and telecommunications (TMT) space, new gen AI use cases are expected to unleash between $380 billion and $690 billion in impact—$60 billion to $100 billion in telecommunications, $80 billion to $130 billion in media, and about $240 billion to $460 billion in high tech. In fact, it seems possible that within the next three years, anything not connected to AI will be considered obsolete or ineffective.

Some leaders are moving to seize the moment and implement gen AI in their organizations at scale, but others remain in the pilot stage, and some have yet to decide what to do. If companies are to remain competitive and relevant in the coming years, it is essential that executives understand the potential impact of gen AI and develop the strategies necessary to incorporate it into their operations. Such strategies would involve an AI-native transformation, focused on building and managing the adoption of gen AI. McKinsey has conducted extensive research into how to embed gen AI to ensure that the technology delivers meaningful value. We’ve also spent much of the past year working with clients to create and then implement gen AI road maps. That combination of research and hands-on experience has allowed us to identify more than 100 gen AI use cases in TMT across seven business domains.1

Our experience working with clients already indicates the potential for telcos to achieve significant impact with gen AI across all key functions. The largest share of total impact will likely be in customer care and sales, which together would account for approximately 70 percent of total impact; network operations, IT, and support functions would round out the rest. The technology already is showing meaningful impact in enhancing interactions between employees and customers: the personalization of products and campaigns, improvements in sales effectiveness, and a reduction in time to market can spark a potential revenue increase of 3 to 5 percent. Customer care interactions—where as much as 50 percent of activity could be automated—have potential for a 30 to 45 percent increase in productivity while improving the customer experience and customer satisfaction scores. 

The keys to deploying fiber networks faster and cheaper

Anton Lysenko, Tiago Silveira, and Manglam Tewari

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Telecom operators are investing heavily to connect more people to high-speed fiber networks. In 2022 in Europe and the United States alone, their networks reached 15.2 million more households than the prior year, compared with the 9.9 million they added in 2018.1 Incumbents, newly formed fiber companies, governments, and private investors are all active in the sector, to the extent that more than one billion homes worldwide now have high-speed fiber access.2

Still, that figure means that some 40 percent of the world’s population remains without fiber access, indicating significant potential for further growth in the fiber-to-the-home (FTTH) market. The extent to which companies capture that potential, however, could hinge on their ability to improve returns on invested capital, as new markets are likely to be those with relatively high costs to serve and low revenue-generating potential. The most attractive markets already have fiber connections.

Reducing costs wherever possible is therefore crucial. But maximizing market share early on is critical too, and this depends upon speed to market. Experience suggests that the first FTTH operator to enter a market—whether overbuilding existing networks with fiber or rolling out new networks—can win significant market share as customers switch from cable and DSL providers. A second, later entrant, however, is likely to capture a significantly smaller share as the pool of customers willing to switch shrinks (Exhibit 1).

WEF Is Waging War on Misinformation and Cyber Insecurity

Katrina Thompson

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What is the greatest cyber risk in the world right now? Ransomware? Business Email Compromise? Maybe AI? Well, the last one is pretty close. According to the World Economic Forum, misinformation and disinformation are the most severe global risks of the next two years.

In their Global Risks Report 2024, the WEF posited that the post-pandemic world is at a "turning point," with the two key problems possessing the power to do everything, from challenging mental health to eroding human rights. Also of concern is the coalescing of AI power and technology, which is lowering the bar to entry for would-be attackers.

Misinformation: What You Don't Know Can Hurt You

"It ain't what you don't know that gets you into trouble," humorist Mark Twain is credited for saying. "It's what you know for sure that just ain't so." The proliferation of convincing generative AI deepfakes has made this statement more relevant than ever.

AI and the Option of Truth

The WEF highlights this trend: "No longer requiring a niche skill set, easy-to-use interfaces to large-scale artificial intelligence (AI) models have already enabled an explosion in falsified information and so-called 'synthetic' content, from sophisticated voice cloning to counterfeit websites." The fact that what we see may no longer reflect reality has some stunning implications, per the report.

Rampant misinformation and disinformation are poised to cause:

• A radical disruption in elections
• Political mistrust leading to polarization
• Repression of human rights as authorities seek to crack down on information abuse – and perhaps step too far

The WEF warns that with the wrong actors leveraging easy-to-use AI tools to create fake content, the truths that guide our societies may be obscured and used to create convincing propaganda to forward private agendas. "New classes of crimes will also proliferate, such as non-consensual deepfake pornography or stock market manipulation," it notes, and elections may be skewed by disinformation to the point where the democratic process itself is eventually eroded. It seems that AI-powered phishing attempts are only the start of AI's malicious potential.

Could Houthi Attacks On Ships Off Yemen Coast Continue Even After A Gaza Ceasefire? – Analysis

Alex Whiteman

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The campaign of attacks by Yemen’s Houthi fighters on shipping in the Red Sea and the Gulf of Aden continues, despite renewed US and UK strikes on their positions, leading to fears about the long-term security of these strategically important waterways.

The persistence of the attacks has turned the spotlight on the Iran-backed militia as it appears to be gaining strength, in terms of weaponry and fighters, and confidence in its ability to cause global trade disruptions.

Speaking at the Munich Security Conference last week, Rashad Al-Alimi, chair of the Presidential Leadership Council of the UN-backed Yemeni government, said the Houthis had irrevocably altered the region’s geopolitical contours.

“The Red Sea will continue to be a source of tension, ready to explode at any political turn, as long as the Houthis control coastal regions,” he added.

“To end Houthi piracy, we must address its origin and source. This can only be accomplished by restoring state institutions, ending the coup, and applying maximum pressure on Iran.”

The Houthi militia is part of the “axis of resistance,” a loose network of Iran-backed proxy militias throughout the region that includes the Palestinian militant group Hamas, Hezbollah in Lebanon, and several Shiite groups in Iraq.    

When the Houthis began attacking commercial shipping in November, they claimed they were only targeting vessels with links to Israel in an attempt to pressure the Israeli government to end its military operation against Hamas in Gaza.

However, Houthi drones, missiles and acts of piracy have been launched against several ships with no ties to Israel. In fact, in recent weeks Yemeni ships, and even vessels belonging to Houthi-allied Iran, have come under attack.

Israel and Hamas indicate no deal is imminent after Biden signals Gaza cease-fire could be close

TIA GOLDENBERG, WAFAA SHURAFA AND SAMY MAGDY

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Israel and Hamas on Tuesday played down chances of an imminent breakthrough in talks for a cease-fire in Gaza, after U.S. President Joe Biden said Israel has agreed to pause its offensive during the Muslim holy month of Ramadan if a deal is reached to release some hostages.

The president’s remarks came on the eve of the Michigan primary, where he faces pressure from the state’s large Arab American population over his staunch support for Israel’s offensive. Biden said he had been briefed on the status of talks by his national security adviser, Jake Sullivan, but said his comments reflected his optimism for a deal, not that all the remaining hurdles had been overcome.

In the wake of Hamas’ Oct. 7 attack on southern Israel, Israel’s air, sea and ground campaign in Gaza has killed tens of thousands of people, obliterated large swaths of the urban landscape and displaced 80% of the battered enclave’s population.

Israel’s seal on the territory, which allows in only a trickle of food and other aid, has sparked alarm that a famine could be imminent, according to the United Nations.

With U.N. truck deliveries of aid hampered by the lack of safe corridors, Egypt, Jordan, the United Arab Emirates, Qatar and France conducted an airdrop of food, medical supplies and other aid into Gaza on Tuesday. At a beach in southern Gaza, boxes of supplies dropped from military aircraft drifted down on parachutes as thousands of Palestinians ran along the sand to retrieve them.

But alarm is growing over worsening hunger among Gaza’s 2.3 million Palestinians.

Two infants died from dehydration and malnutrition at Kamal Adwan Hospital in Gaza City, said the spokesman for Gaza’s Health Ministry, Ashraf al-Qidra. He warned that infant mortality threatens to surge.

Ceasefire Talks Are About More Than A Gaza Truce And Prisoner Exchange – Analysis

James M. Dorsey

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A proposed temporary Gaza ceasefire and prisoner exchange appears designed to buy war-battered Gazans relief while enabling Israel and Hamas to claim a success.

However, whether Israel or Hamas emerges as the ultimate victor will be determined by whether the truce becomes permanent and the war ends.

Negotiated by Qatar, Egypt, the United States, Israel, and Hamas, the deal would be whittled down to the first stage of an earlier three-phase proposal that envisioned three 45-day periods during which a permanent ceasefire would be negotiated.

The whittled-down plan suggests that the parties, except for Israel, who is determined to continue the war, hope the truce will create space for a negotiated permanent ceasefire.

Hamas has yet to formally respond to the latest proposal but a senior official, told Al Jazeera, “The atmosphere of optimism does not reflect reality.”

For his part, Israeli Prime Minister Binyamin Netanyahu asserted that “if Hamas goes down from its delusional claims and brings them down to Earth, we’ll have the progress that we all want.”

This weekend, Israel’s war cabinet decided to send a delegation to Qatar for further talks.

In a nod to Hamas demands, Israel would under the plan redeploy but not withdraw its troops from Gaza and allow the return to the northern part of the Strip of internally displaced Palestinian women and children.

Hamas has insisted on a full Israeli withdrawal and the unrestricted return of Palestinians to their often-destroyed homes.

Biden Says Israel Is Open to Ceasefire During Ramadan if Hostage-Release Deal Is Reached

TIA GOLDENBERG, WAFAA SHURAFA AND SAMY MAGDY 

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Israel would be willing to pause its war on Hamas in Gaza during the upcoming Muslim fasting month of Ramadan if a deal is reached to release some of the hostages held by the militants, President Joe Biden said in comments released on Tuesday.

There was no immediate Israeli reaction to Biden’s comments on an emerging framework deal, brokered by the United States, Egypt and Qatar, under which Hamas would free some of the dozens of hostages it holds in exchange for the release of Palestinian prisoners and a six-week halt in fighting. During the temporary pause, negotiations would continue over the release of the remaining hostages and additional Palestinian prisoners held by Israel.

A Hamas official played down any sense of progress, saying the group wouldn't soften its demands.

The start of Ramadan, which falls around March 10, is seen as an unofficial deadline for a cease-fire deal. The month is a time of heightened religious observance and dawn-to-dusk fasting for hundreds of millions of Muslims around the world. Israeli-Palestinian tensions have flared in the past during the holy month.

Biden said Monday that he hopes a cease-fire deal could take effect by next week.

“Ramadan’s coming up and there has been an agreement by the Israelis that they would not engage in activities during Ramadan as well, in order to give us time to get all the hostages out,” Biden said in an appearance on NBC’s Late Night With Seth Meyers.

At the same time, Biden did not call for an end to the war, which was triggered by the deadly Hamas attack on southern Israel on Oct. 7, when militants killed 1,200 people, mostly civilians, and abducted roughly 250 people, according to Israeli authorities.

Biden, who has shown staunch support for Israel throughout the war, left open the door to an eventual Israeli ground offensive in the city of Rafah in southern Gaza, on the border with Egypt, where more than than half of the enclave’s 2.3 million people have fled under Israeli evacuation orders.

Has the Indian Flagship Kaladan Project in Myanmar Hit a Dead End?

Rajeev Bhattacharyya

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Developments in Myanmar since the military coup three years ago seem to have convinced a section of high-ranking Indian government officials that the flagship Kaladan project has hit a dead-end. They believe that the chances of work on the incomplete stretch of the ambitious initiative being resumed are bleak.

Early this month, the Indian government issued a travel advisory asking all Indian nationals to refrain from visiting Myanmar’s Rakhine State where a fierce war is on between the Myanmar junta and the Arakan Army. A vast swathe of territory in Rakhine State and the adjoining territory in southern Chin State have already been taken over by the Arakan Army compelling a section of the regime forces to flee to the Indian border state of Mizoram and Bangladesh for safety from where they were air-lifted to Myanmar.

The Kaladan Multi-Modal Transit Transport project is a key component of India’s Act East Policy. It aims at providing an alternate outlet to the country’s landlocked northeast. Since the project commenced 13 years ago, it has missed many deadlines.

The Kaladan project has two components — road and inland waterway — to link Mizoram in India’s northeast to Sittwe port in Rakhine State. Zorinpui on the border between the twin countries will be connected to Paletwa in Myanmar with an approximately 68-mile-long road and 98 miles of inland waterway through the Kaladan river from Paletwa to Sittwe port.

The 68-mile stretch of highway from Paletwa to Zorinpui at the India-Myanmar border is yet to be constructed. The highway has two parts — 42 miles from Paletwa to Kaletwa and 26 miles from Kaletwa to Zorinpui. This highway passes through a zone that is among the worst-affected regions in the ongoing fighting between the military and resistance forces in Myanmar.

Today is Afghan Soldier's Day

COL. Parwani & John Waters

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At a small office in northern Virginia, far from our homes and families in Afghanistan, my fellow Afghan veterans and I are celebrating the courage and sacrifice of our countrymen.

On February 27, 2017, former president of Afghanistan Ashraf Ghani dedicated February 27 as Armed Forces Day. Ceremonies and events were held to honor the service of some 350,000 Afghans who fought to defend a new Government of the Islamic Republic of Afghanistan.

Seven years later, and less than three years since our government fell to the Taliban, “Soldier’s Day” is no longer celebrated in Afghanistan. For those of us forced to flee the country, we celebrate this day in exile.

We did not merely lose our government when the Taliban swept through Afghanistan in 2021. The dreams of countless young men and women were lost, too. Many of my countrymen, including former soldiers in the Afghan National Security Forces, have sought refuge in neighboring countries. They fled oppression and violence inflicted by the Taliban. Unfortunately, their circumstances remain dire as they struggle to find new homes and face mistreatment in their host nations.

Wearing the military uniform was a badge of honor. Like young Americans who courageously volunteer to fight for their country, defending Afghanistan was ingrained in our very beings. Each morning, we rose with determination to defend peace and stability in our nation, allowing our people to live free from the ravages of war and oppression.

New Pakistani Government Seeks Another Bailout From IMF

Umair Jamal

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Pakistan’s new coalition government has its work cut out on the economic front. As part of the second review of the current $3 billion bailout package, International Monetary Fund (IMF) officials are scheduled to visit Pakistan in March to review the implementation of the targets agreed during last year’s review with the Anwaar-ul-Haq Kakar-led interim government.

Seemingly, the outgoing interim government has achieved nearly all of the targets set by the IMF during the second review for Pakistan to obtain the last $1.1 billion payment. In a report that the caretaker government sent to the international lender a few days ago, the Ministry of Finance confirmed that 25 of the 26 financial targets set by the IMF for the second economic review were met.

With the current IMF loan agreement coming to an end in the coming weeks, securing financing from multilateral and bilateral partners will be one of the most urgent issues on the agenda for the new government. It seems that the latter will begin preparing for talks on a significant new agreement worth $6 billion when the IMF delegation arrives in Pakistan next month.

However, navigating this financial landscape is anything but straightforward, as political controversies stemming from recent elections have created challenges.

Despite innumerable restrictions imposed on the Pakistan Tehreek-e-Insaf (PTI)’s participation in the election — among other things, it was denied the use of its traditional election symbol, the cricket bat, forcing its candidates to contest as independents — candidates it supported managed to secure the largest number of seats in the National Assembly. Even with its impressive showing, PTI lacks a majority, and a Pakistan Muslim League-Nawaz (PML-N)-Pakistan People’s Party (PPP) coalition is set to form the new federal government.

After War, Afghanistan’s New Battle: Climate Disasters – OpEd

Meladul Haq Ahmadzai

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During the war, Afghanistan grappled with climatic disasters amidst competing priorities. Today, post-war, the nation confronts exacerbated challenges of climate change, contending with issues like prolonged droughts and severe flooding. The shift from wartime concerns to environmental battles underscores the ongoing and evolving struggles faced by Afghanistan.

Now, Afghanistan lacks the previous level of Western support to address climate disasters. The war inflicted extensive damage on crucial infrastructure, including roads and electricity, which not only contributed to the local economy but also had broader regional benefits.

A drought is characterized by a prolonged absence of rainfall, and Afghanistan is currently grappling with this exact challenge. Presently, over 15 million individuals are experiencing poverty or food insecurity due to the scarcity of rain.

In essence, enhancing environmental health requires an increased focus on tree plantation and implementing flood control measures through the Disaster Risk Reduction (DRR) process. Currently, water scarcity is a pressing issue, with research indicating a continuous decrease of around 6 percent.

Who Will Talk To Afghanistan’s Taliban? – Analysis

James Durso

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On Feb. 18 and 19, United Nations Secretary-General Antonio Guterres convened a meeting in Doha, Qatar, to discuss the “evolving situation” in Afghanistan and future engagement with the Islamic Emirate of Afghanistan. The Taliban declined an invitation to the meeting after the U.N. refused their conditions, including recognizing the Taliban as the legitimate government of Afghanistan.

Guterres reported that the attendees’ “creation of a contact group with a more limited number of states able to have a more coordinated approach in the engagement with the de facto authorities” might include “the P-5 with a group of neighboring countries and a group of relevant donors.” Guterres said he is starting consultations on the appointment of a special envoy “to coordinate engagement between Kabul and the international community.”

The Taliban rejected the need for a special envoy, but Pakistan supported it and specified the envoy must be a “Muslim, experienced diplomat, and from the region.”

Though the West is fixed on the issue of Afghan women and girls, the world needs to engage with the Islamic Emirate on other issues, including water rights, migration, narcotics trafficking and counterterrorism. In many instances, neighbors are already talking directly to the emirate, such as Tashkent’s low-key discussions with Kabul over rights to the water of the Amu Darya, which rises in the Pamir Mountains.

Other countries will also prefer to deal directly with Kabul. China recently appointed a new ambassador to the emirate; Russia will continue its engagement with Kabul; and the Central Asian republics, Iran and Pakistan, as neighboring countries, will not feel the need to use the offices of the envoys, though it will be useful if it can “me-too” their existing positions.

China Is Obsessed with Sinking America's Aircraft Carriers

Kyle Mizokami

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Summary: The Third Taiwan Crisis in 1995-1996 exposed China to the strategic dominance of U.S. aircraft carriers, marking a turning point in Chinese military planning. Following Taiwan's democratic elections and the U.S.'s military support, China initiated military exercises as a form of intimidation, which included missile tests near Taiwan. The U.S. responded with a powerful carrier presence, highlighting China's military limitations. This event spurred China into expanding its naval capabilities, purchasing and refurbishing an unfinished Russian carrier into the Liaoning, and developing anti-ship ballistic missiles. Today, China aspires to a significant carrier fleet while innovating in carrier countermeasures.

Almost thirty years ago, a military confrontation in East Asia pushed the United States and China uncomfortably close to conflict. Largely unknown in America, the event made a lasting impression on China, especially Chinese military planners. The Third Taiwan Crisis, as historians call it, was China’s introduction to the power and flexibility of the aircraft carrier, something it obsesses about to this day.

The crisis began in 1995. Taiwan’s first-ever democratic elections for president were set for 1996, a major event that Beijing naturally opposed. The sitting president, Lee Teng-hui of the Kuomintang party, was invited to the United States to speak at his alma mater, Cornell University. Lee was already disliked by Beijing for his emphasis on “Taiwanization,” which favored home rule and established a separate Taiwanese identity away from mainland China. Now he was being asked to speak at Cornell on Taiwan’s democratization, and Beijing was furious.

The Clinton administration was reluctant to grant Lee a visa—he had been denied one for a similar talk at Cornell the year before—but near-unanimous support from Congress forced the White House’s hand. Lee was granted a visa and visited Cornell in June. The Xinhua state news agency warned, “The issue of Taiwan is as explosive as a barrel of gunpowder. It is extremely dangerous to warm it up, no matter whether the warming is done by the United States or by Lee Teng-hui. This wanton wound inflicted upon China will help the Chinese people more clearly realize what kind of a country the United States is.”

Leaked Hacking Documents Show China’s Focus on Tracking Ethnic Minorities

Liza Lin and Austin Ramzy

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A man living in New York got a call in 2020 from police in the southern Chinese city of Shenzhen, who wanted to know if he knew anything about an account on Twitter, the social media site now known as X.

The man had immigrated to the U.S. after being born in China’s western region of Xinjiang, where the ethnic minority Uyghurs and other groups have faced mass detentions and other rights abuses. After arriving in the U.S., he began speaking out about the plight faced by Uyghurs.

He didn’t know at the time he got the call that he had been targeted for a hack. A trove of documents that were purportedly leaked from a cybersecurity firm in China this month includes a chat log dated March 2020—weeks before he got the call—in which a representative of the company discusses digging up information on a number of people behind social-media accounts.

The man, who asked not to be identified, said his account was among those identified in the chat log. “I have reasons to believe that I was targeted in a campaign to collect information about Uyghurs,” he said.

I-Soon appears to be one of a group of private surveillance firms that supplement China’s spying. 

The documents, which appeared to come from a Chinese cybersecurity firm called I-Soon, have opened a new window into how China’s government uses surveillance to impose political controls inside and outside of its borders. A Wall Street Journal analysis of the documents indicates a strong focus on people from the country’s periphery, including ethnic minority groups that Beijing sees as a potential source of political instability.

China Is Winning the Battle for the Red Sea, America Has Retired as World Policeman

Nathan Levine

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Hardly for the first time, remote Arab tribesmen are reshaping the world. Piratical attacks on international shipping by Yemen-based Houthi rebels have created a significant security crisis in the Red Sea. The world’s largest shipping lines have been forced to suspend transit through the Red Sea and thus the Suez Canal. And with nearly a third of global container traffic typically flowing through Suez, this has seriously disrupted world trade. Yet the most enduring impact of the crisis may be on the geopolitical balance between two great powers, each many thousands of kilometres away from the scorching sands of the Arabian Peninsula: China and the United States.

As the world’s largest trading nation, China has much at stake in the Red Sea. Europe is China’s top trade partner, and more than 60% of that trade by value usually flows through the Suez Canal. With that route disrupted, cargo vessels are diverting around Africa’s Cape of Good Hope, adding up to two weeks in additional travel time and vastly increasing shipping costs. By 25 January, the average cost of shipping a 40-foot container from Shanghai to Genoa spiked to $6,365, an increase of 464% from two months earlier. Insurance rates have also skyrocketed. What’s more, Chinese companies have in recent years poured billions of dollars’ worth of investment into assets in the region, such as the 20% stake in the East Port Said container terminal of the Suez Canal that is now owned by Chinese state shipping giant COSCO. At a time when China’s growth rate is already struggling, the crisis risks imposing a serious further drag on its economy.

Apparently perceiving this vulnerability, Washington has tried to use it as leverage to convince Beijing to help end the crisis. China is the top economic and geopolitical backer of Iran, which in turn backs the Houthis, using them as a proxy to needle Israel, the United States and its allies. Some officials in Washington are convinced that, if it really wanted to, Beijing could quickly pressure Tehran into ending the Houthi attacks. Biden administration officials have “repeatedly raised the matter with top Chinese officials in the past three months”, according to the Financial Times, and U.S. National Security Advisor Jake Sullivan recently flew to Thailand to directly plead the administration’s case in a meeting with Chinese Foreign Minister Wang Yi.

Maintaining the best thing the US built in Iraq: Continued support to the Iraqi Counterterrorism Service

Joseph L. Votel, Christopher P. Costa

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For the past several years, US interests have drifted away from the wars in Iraq and Afghanistan to focus on national security issues in the Pacific and — now — Europe. Unfortunately, the security situation in the Middle East and events like Hamas' Oct. 7 attack, strikes by Iranian-linked groups on US troops, and Houthi attacks on shipping in the Red Sea continue to pull US attention back to the region.1

Iraq has once again reemerged as a central battleground in the turmoil in the Middle East. Iranian-supported militia groups target US troops in the country in response to US government actions, with the US responding in kind.2 The threat of the Islamic State remains.3 Iranian influence in Iraq has expanded through Iranian-backed militias within the country.4 The Higher Military Commission (HMC), a joint dialogue with the Iraqi government to discuss the future of the coalition forces combating the Islamic State, is intermittently ongoing. At the same time, bilateral discussions between the US and Iraq's government are likely occurring as well.5

Of the many issues discussed during these talks, we should not overlook ensuring a continued relationship between the US Special Operations Forces (USSOF) and the Iraqi Counterterrorism Service (CTS). The CTS, an organization built and supported by the US and with a strong partnership with USSOF, is a critical, enduring strategic partner in the region. It is the most significant and capable counterterrorism force in the Middle East. While it faces challenges, as outlined in the latest Lead Inspector General report on Operation Inherent Resolve, including reliance on coalition forces for some intelligence, surveillance, and reconnaissance and varying levels of effectiveness across the country,6 the CTS will be essential in maintaining pressure on the Islamic State and can prevent, or at least limit, the US from further strategic distraction in the Middle East. The CTS has long been a strong US partner, and the force's capability strengthens a sovereign Iraq beset with challenges from militias acting outside the Iraqi government's control. The US must prioritize a continued USSOF relationship with the CTS, deliberately plan to maintain the relationship, and learn from our past experiences to create a genuinely effective long-term counterterrorism partnership.

The Houthi air strikes aren’t working

PHILIP PILKINGTON

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Over the weekend the United States and United Kingdom launched a fourth round of missile and air strikes against the Houthis in Yemen. In a joint statement it was announced that 18 targets in 8 locations were hit, including “underground weapons storage facilities, missile storage facilities, one-way attack unmanned aerial systems, air defence systems, radars, and a helicopter”.

Yet these strikes come as the crisis in the Red Sea region worsens. Earlier in the week Houthis struck the British freighter Rubymar with an anti-shipping missile, prompting the ship to be abandoned. Photographs show that it is half-submerged in the water, and so will likely have to be sunk. This is the first ship that the Houthis have truly destroyed.

What’s more, the Houthis are now using unmanned underwater vehicles (UUVs), otherwise known as submarine drones. The UUVs appear to be supplied by Iran, and have wiring attached which allows them to be operated from the shore. They are effectively cheap guided torpedoes and, since they operate underwater, are extremely hard to detect.

It is now increasingly clear that the Red Sea is becoming a testing ground for new Iranian weaponry, and the Houthis have already achieved their goal of imposing an effective naval blockade in the region. Freight container shipping volumes through the region have fallen around 80% since the start of the year, demonstrating that the new weaponry is provoking a response from American and British ships.

China and Iran have ships in the region monitoring the situation, and are no doubt collecting invaluable information on Western defence systems that could be used in a future conflict in either the Persian Gulf or the South China Sea. This raises the question of why the Americans and the British are intervening in the way they are. Why would they give their rivals this sort of information? Presumably they justify their presence and the strikes in Yemen because these damage the capacity of the Houthis to harass commercial ships — but the data simply does not show this.

Memo to the President on U.S. Leadership in Next-Generation Energy

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Hello, I’m Ylli Bajraktari, CEO of the Special Competitive Studies Project. In this edition of 2-2-2, members of SCSP’s Future Technology Platforms team, Olivia Armstrong, David Lin, and Ben Bain, make the tech competition case for why we need a National Action Plan for Next-Generation Energy.

In this action plan, we highlight the strategic significance of energy generation, storage, and transmission/distribution as nations compete for geopolitical influence and innovation power. In line with previous SCSP technology action plans, we propose a series of ambitious tech-focused moonshots, complemented by a set of policy recommendations consisting of what we believe to be the minimal viable solutions necessary to accelerate American innovation and the scaling of next-generation energy technologies. While this plan is not exhaustive, it aims to foster a holistic approach to energy policymaking and innovation – essential elements for developing an energy technology strategy for national competitiveness.

To underscore the urgency of prioritizing technology competition in the energy domain, we present this Memo to the President on U.S. Leadership in Next-Generation Energy, where we assess areas within the energy domain that the United States or the People’s Republic of China (PRC) has the competitive advantage, and which energy sectors are being contested.

The Russian Military Is Being 'Blinded' in Ukraine

Peter Suciu

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Russia is Being Blinded as Second A-50 Spy Plane Has Been Shot Down: The Ukrainian military shot down a second Russian A-50 military spy plane last week – the second of the aerial reconnaissance aircraft to be destroyed in just over a month. The A-50 was reported to have been downed while flying between the Russian cities of Rostov-on-Don and Krasnodar, more than 200km (124 miles) from the front lines.

According to a report from the BBC, Russian emergency services discovered plane fragments in the Kanevskoy district and put out a raging fire. The downing of the aircraft came as Saturday marked two years since Russia had launched its full-scale invasion of Ukraine.

The Kremlin never commented on the alleged loss of an A-50 in January, which Kyiv said was shot down over the Sea of Azov, but Russian bloggers and some media confirmed the aircraft's loss. As previously reported, the loss of even a single A-50 long-range radar detection aircraft would be a serious blow to the Kremlin's air power in the region.

A-50: Russia's AWACS

The Beriev A-50 (NATO reporting name "Mainstay") was developed by the Soviet Union in the 1970s and is based on the Ilyushin Il-76 transport. Developed to replace the Tupolev Tu-126 (NATO reporting name "Moss"), the A-50 took its maiden flight in 1978 and entered service in 1985.

The aircraft has been compared to the United States Air Force's E-3 Sentry – commonly known as the AWACS (Airborne Warning and Command System) – but with notably fewer capabilities. While a total of 40 were built, just nine were reported to be in operation when Russia launched its unprovoked invasion of Ukraine two years ago. In addition to only having a handful in service, the A-50 has been considered a high asset target – reportedly costing upwards of $330 million each.

Why Russia Never Built a Feet of Aircraft Carriers Like the U.S. Navy

Maya Carlin

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Summary: Despite its historical naval prowess, Russia has not developed a significant aircraft carrier fleet, relying instead on Admiral Kuznetsov, its sole, problematic aircraft carrier. The Soviet Union's collapse and subsequent financial and strategic missteps hindered the development of a robust carrier force. The Kuznetsov, plagued by mechanical failures and operational mishaps, falls short of its potential, highlighting Russia's missed opportunity in naval aviation advancement. This situation contrasts sharply with the U.S. Navy's progression towards modern aircraft carriers, emphasizing the strategic and technological gap between the two naval powers.

While the U.S. Navy is inching closer to commissioning its second Gerald R. Ford-class aircraft carrier, Russia remains dependent on its semi-defunct Admiral Kuznetsov for sea-based power projection. Despite the former Soviet Union’s military prowess and development during the Cold War, the completion of robust aircraft carriers never came to fruition. Once the USSR collapsed in 1991, any hopes for the Soviet’s carrier aspirations came crumbling down. Due to poor planning and timing over the years, Russia possesses a singular aircraft carrier in its naval fleet. To make matters worse, Admiral Kuznetsov has proven to be a massive disappointment.

The history of Russia’s Navy:

Following the death of Peter the Great in the early 18th century, the Imperial Russian Navy sharply declined. In fact, between 1726-1730, only 54 ships were constructed. During the second half of this century, Russia saw an uptick in its naval development due to its domination of the Black Sea. By the turn of the 19th century, Russia’s progress on this front ramped up quickly. The Russian Navy became the second most powerful naval force across the globe at this time, second to the United Kingdom.

Most UN Security Council Members Demand Taliban Rescind Decrees Seriously Oppressing Women and Girls

Edith M. Lederer

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More than two-thirds of the U.N. Security Council’s members demanded Monday that the Taliban rescind all policies and decrees oppressing and discriminating against women and girls, including banning girls’ education above the sixth grade and women’s right to work and move freely.

A statement by 11 of the 15 council members condemned the Taliban’s repression of women and girls since the group took power in August 2021, and again insisted on their equal participation in public, political, economic, cultural, and social life – especially at all decision-making levels seeking to advance international engagement with Afghanistan’s de facto rulers.

Guyana’s U.N. Ambassador Carolyn Rodrigues-Birkett read the statement, surrounding by ambassadors of the 10 other countries, before a closed council meeting on U.N. Secretary-General Antonio Guterres’ conference with more than 25 envoys to Afghanistan on February 18-19 in Qatar’s capital, Doha.

Afghan civil society representatives, including women, participated in the Doha meeting, which the council members welcomed. The Taliban refused to attend, its Foreign Ministry saying in a statement that its participation would be “beneficial” only if it was the sole and official representative for the country at the talks.

While the Taliban did not attend the meetings, U.N. political chief Rosemary DiCarlo did meet with Taliban officials based in Doha, U.N. spokesman Stephane Dujarric said. DiCarlo also briefed council members at Monday’s closed meeting.

The Taliban have not been recognized by any country, and the U.N. envoy for Afghanistan last year warned the de facto rulers that international recognition as the country’s legitimate government will remain “nearly impossible” unless they lift the restrictions on women.

Does the American army’s future lie in Europe or Asia?

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The year 1973 was pivotal for America’s army. The force was battered and broken from Vietnam. In January the defence secretary announced the end of conscription; two months later the last combat troops left Vietnam. But the Arab-Israeli war which broke out on Yom Kippur in October planted the seeds of renewal. The lessons of that war, absorbed by American officers sent to Israel, helped reshape America’s army into the modern and professional force which would vanquish Iraq in 1991.

Today’s generals, who came of age during that transformation, are keenly aware of the resonance. “There’s a loose analogy between the early 1970s and the army of Desert Storm,” says General James Rainey, who leads the army’s Future Command, “and the army which invaded Iraq in the early 2000s and where we need to be in 2040.” Two decades of war in Afghanistan and Iraq wore out troops, equipment and ideas. A recruitment shortage remains unresolved. Now the rise of China and the lessons from the war in Ukraine have prompted introspection, renewal and reform.

NATO NEeds to Get Serious at Seventy-Five

John Sitilides

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NATO Secretary General Jens Stoltenberg recently arrived in Washington seeking to persuade the White House and Congress to successfully negotiate legislation that would free up $60 billion to help Ukraine defend itself against Russian forces.

He delivered his remarks on the occasion of the defensive alliance’s imminent seventy-fifth anniversary. His audience expected to hear a blueprint for readying the alliance for the next twenty years, in preparation for its hopeful centennial in 2049.

Stoltenberg first underscored the need to “ensure robust deterrence,” hailing that “NATO has implemented the most robust collective defense since the Cold War. We have more forces at higher readiness. And more capabilities to protect our people, and our territory.”

What he could not proclaim is that these force, readiness, and capabilities levels are sufficient to prevail over present and anticipated geopolitical risks confronting the alliance. Comparing today’s levels with the past offers zero insight into current and near-term will and preparedness to deter and, if needed, to compel NATO adversaries towards preferred diplomatic outcomes.

Stoltenberg then stated that “we must eliminate harmful dependencies on critical Chinese raw materials and products,” and that “we need to protect our critical infrastructure, strategic materials and supply chains. We must not lose control of our ports, railways, and telecommunications.”

According to the Alphaliner shipping database, Chinese companies in August 2023 were invested in thirty-one European container seaport terminals, twenty-three of which are held by state-controlled companies COSCO and China Merchants, and the remaining eight by Hong Kong’s privately held Hutchison Ports.

How to Save Free Trade

Peter E. Harrell

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As the U.S. presidential election approaches, President Joe Biden and former President Donald Trump have found common cause in their opposition to new trade deals. In the final months of 2023, the Biden administration postponed a decision on the trade pillar for the long-planned Indo-Pacific Economic Framework and withdrew long-standing U.S. support for digital trade provisions at the World Trade Organization. The deferral of IPEF—which is the administration’s key initiative for deepening U.S. economic relations with partners across the Pacific—leaves the Biden administration without a signature trade agreement, and the decision on digital trade means that Washington no longer has a clear position on whether it supports or opposes restrictions on global data flows. As the Republican front-runner in this year’s presidential election, Trump has made a 60 percent tariff on imports from China and a ten percent tariff on imports from everywhere else, including such partners as Germany and Mexico, signature proposals of his campaign to win back the White House.

This bipartisan pivot away from trade has caused consternation across Washington’s foreign policy establishment, which has long regarded trade deals as an important tool for building geopolitical coalitions. According to this view, the United States’ failure to pursue trade accords plays into the hands of its major rivals, who are busily negotiating them. A Washington Post editorial summarized this perspective last year: “To compete with China, the U.S. should put real trade deals on the table.”

But treating trade as a necessary evil in an era of intensifying geopolitical competition is no longer a winning argument. Few policymakers and analysts—and relatively few members of the public—seem convinced of the virtues of free trade. This is not least because, as Robert Lighthizer, the U.S. trade representative during the Trump administration, memorably quipped at a congressional hearing, the Beatles taught him in the 1960s that “money can’t buy me love.” Indeed, trade’s limited ability to create goodwill has become increasingly clear over the past decade. Despite close trading relationships with Russia and China, the United States was unable to stop the former from invading Ukraine, and tensions with the latter have soared. The belief that trading ties reliably produce geopolitical goodwill has faded. Nor, with the U.S. economy enjoying the strongest performance of any major developed country since the COVID-19 pandemic, do trade deals seem essential to the United States’ prosperity. Even in the absence of new deals, American trade with allies has boomed as Trump’s China tariffs, Russia’s war, and the global trend of relocating supply chains away from Beijing have shrunk U.S. trade with China while expanding it with other countries.

Ukraine: Wishful Thinking

Edward Lucas

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The movie script was almost written. Vladimir Putin had overreached himself in Ukraine. The Russian dictator forged national unity there and revived the transatlantic alliance. He had foolishly confronted not just Ukraine but the world’s richest and most powerful countries, with predictably catastrophic results.

Sanctions would cripple his economy and war machine. His friends, scenting defeat, would flinch. Long-range precision strikes would destroy logistics. Settlers would flee Crimea. Setbacks on the battlefield, plus shortages of food, fuel, ammunition, and spare parts would lead to mutiny, surrender, and desertion among the ill-led, badly trained invading forces.

As Russia’s mangled army folded in the face of Ukraine’s mighty counter-offensive, military disintegration — 1917 all over again — would lead to political change in Moscow. Russians would revolt against mobilization. The elite would split and switch sides.

Under new leadership, Russia would wake up from its imperialist frenzy and become a friendly, normal, law-governed country. Unicorns would prance around Red Square and a permanent rainbow would reach from Kaliningrad to Vladivostok. 

All that was wrong. And not just the last bit. The West wildly overestimated its own resources and willpower. It placed far too great a burden on Ukraine’s ability to win what became a war of attrition. It underestimated Russia’s ability to learn from mistakes, to build formidable defensive lines, to evade sanctions, to ramp up its war economy, to accept casualties, to crush dissent.

The result: Ukraine is running out of troops and ammunition. A catastrophic military defeat may not be imminent, but the danger is growing of more Russian territorial gains, more misery, and an arm-twisted deal in which Ukraine will have to make painful concessions. 

Could a European Army Go It Alone?

Ellie Cook

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Apipe dream, a fantasy—just two of the phrases bandied about whenever the idea of a European or European Union army resurfaces.

This time, it was the Italian foreign minister, Antonio Tajani, who prodded the conversation awake again. "If we want to be peacekeepers in the world, we need a European military," Tajani told Italy's La Stampa newspaper in early January. "This is a fundamental precondition to be able to have an effective European foreign policy."

The idea is bound up in complications from the get-go. There is no harmony on even the terminology—would this be is a European force, or one only open for European Union members? Would it be an army, or a fully-fledged military with all the capabilities that come with it?

"It's never really come anywhere near anything real," former NATO official Edward Hunter Christie told Newsweek.

But times are changing. War has raged in Ukraine for two years, and many NATO countries, including EU member states, have had a nasty wake-up call about lax defense spending. "More effort, money, and risk appetite is needed in Europe, a continent where most allies have yet to grasp the cost of security," argued the Center for European Policy Analysis in late November.

Comments from former President Donald Trump, the frontrunner for the Republican presidential nomination, fuel the fire. Speaking during a rally in South Carolina in February, the GOP favorite suggested the U.S. would not shield fellow NATO members falling behind on defense spending.

Six Takeaways from Two Years of Russia-Ukraine War

Alessandro Marrone

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In February 2022, Russia invaded Ukraine from the North, East and South in order to control the whole country through direct military occupation and/or a proxy government. Moscow assumed a rapid collapse or surrender of the Ukrainian state and planned a relatively fast war of manoeuvre coupled with air assaults and/or amphibious operations to take over major cities such as Kyiv, Kharkiv and Odesa. Ukraine – which had prepared to some extent for a Russian invasion since 2014 – resisted and rolled back invading forces from its major cities in 2022, including from Kherson despite its illegal annexation to the Russian Federation. In late spring 2023, Kyiv launched a counter-offensive aimed at liberating territories south of Zaporizhzhia, but unfortunately Russian forces were able to hold most of the ground previously gained. A high level of attrition has now been experienced by both sides for several months, with more than half a million troops deployed by belligerents.

Over the last six months, the war has turned into a bloody stalemate. It witnesses continuous and indiscriminate air campaigns by Russia – including the use of bombs, missiles and drones –, tailored raids by Ukraine on the occupied territories and across the Black Sea, and above all fierce land battles over a highly fortified frontline with a systematic, mutual shelling and massive use of drones. Two years after the beginning of the invasion, Russian armed forces control the land corridor that connects the Crimea peninsula to Donbas – two areas already directly or indirectly under Moscow influence since 2014 – and the whole Azov Sea: a region accounting for slightly less than 20 per cent of Ukrainian territory. Still, Ukraine continues to access the Black Sea and export its goods. Such an occupation has cost so far dozens of thousands of military casualties in both countries, the lives of thousands of Ukrainian civilians, as well as huge numbers of injured people and millions of displaced citizens – plus the material destruction brought by the conflict. What does this dramatic watershed for Ukraine mean for Europe as a whole? At least six takeaways can be gained for the armed forces of European countries, NATO and EU defence initiatives, with a view to deterring Moscow from further aggressions and if necessary defending Europe from them.

Putin’s risk-prone and solid leadership

First, the war has proved that Russian leadership is so risk-prone, solid and obsessed with Ukraine to continue a large-scale, high-intensity attrition war despite its enormous costs in terms of blood and treasure, the limited territorial gains obtained so far and the likely scenario of a military stalemate. For the Kremlin and part of Russian society, the war entails a sort of existential character: the restoration of Russia’s great power status, the rollback of Western influence from the former Soviet Republics, and possibly the wreckage of European and transatlantic unity by leveraging certain governments and/or constituencies within the EU and NATO.

National Institute for Defense Studies (NIDS)Security & Strategy, January 2024, v. 4

Cislunar Security: U.S. and Chinese Activities in Cislunar Space and Future Issues

Hypersonic weapons of the U.S., China, and Russia: Implications for Nuclear Deterrence and Arms Control

Revisiting the “Cap-in-the-Bottle” Thesis: Negotiations and Disagreements among Japan, China, and the U.S. in the early 1970s

Japan’s Security Policy Making after Political Reforms: Centralization and Constraints since the First Abe Administration

Digital Transformation of the Chinese Air Force: Initiatives Observed in the PLAAF’s Introduction of a New Maintenance Management System

Supplying Operation to Guadalcanal: From a Japanese Perspective

‘Tactical ISR’ from space requires DoD, NRO policy changes: Calvelli

THERESA HITCHENS

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The Defense Department needs to fully control use of future space-based systems being jointly developed with the Intelligence Community to gather battlefield intelligence, surveillance and reconnaissance (ISR), Air Force space acquisition head Frank Calvelli said Friday.

“We are clearly moving away from airborne ISR assets and moving into space. It’s the absolute right thing to do from a resiliency and sustainability perspective,” he told the Center for Strategic and International Studies (CSIS). “I think if we drive tactical ISR in space to be more like national technical means the country will lose, the warfighter will lose.”

National technical means is a term of art often used for referring to US spy satellites owned and operated by the National Reconnaissance Office (NRO) to support intelligence analysis, including verification of arms control treaties.

But that will require changes to outdated policies on both sides, Calvelli explained.

“It’s policy. … The policies about space ISR were written in the ’80s and ’90s, maybe even the ’70s, when we were trying to sort of manage a much smaller constellation of national systems,” he said. “I think the DNI [Director of National Intelligence] and DoD both need to review the policies about tactical ISR systems in space, and allow them to have the same control, same classification and same direct downlinks that tactical airborne ISR systems have today.”

Calvelli stressed that any new tactical ISR satellite networks being developed in tandem by the Space Force and NRO — such as for tracking moving targets on the ground — need direct data connections to US military platforms on the ground, at sea and in the air.

The Coming Showdown Over Rafah

DAN RAVIV

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The war between Israel and Hamas is approaching a key moment of decision. Will the powerful Israel Defense Forces (IDF) smash their way into calamitously crowded Rafah? After destroying many thousands of homes elsewhere in the strip, Rafah would be the IDF’s final target. That’s where Hamas leaders are believed to be hiding in their vast network of tunnels, probably with more than 130 hostages kidnapped from Israel on October 7 as part of a terrorist attack that killed around 1,200 people.

Or perhaps Hamas will end this war by freeing all the hostages? That could be part of a deal in which the Islamic radical group’s leaders would be allowed to leave for exile, probably in some Arab country—which is what the PLO’s Yasser Arafat chose to do, departing Lebanon after the IDF invaded that country in 1982.

President Joe Biden has pointedly told Israel that Rafah—where the usual population of 400,000 Palestinians has swelled by an additional million who fled there to escape Israeli bombings and fighting—should not be the next battleground, unless Israel can carry out a detailed plan to evacuate the civilians.

The result, so far, is a game of chicken. Who will blink first?

Israel’s Prime Minister Benjamin Netanyahu—but also retired General Benny Gantz, his political rival who joined an emergency war cabinet after October 7—have declared that the IDF has to go into Rafah: to finish the job of destroying Hamas’s governing power, to kill or capture the group’s leaders, and to rescue as many hostages as possible. Gantz even suggested a deadline of March 10.

Yet so far, the refugees in their tents have not been leaving: not going back to damaged or destroyed homes, and certainly not being allowed by neighboring Egypt to cross the border into the Sinai peninsula. Those displaced Palestinians understandably tell aid workers and reporters that there is no place safe in the Gaza strip. Many say they are entrusting their fate to God.