Paul G. Buchanan: A Change Of Focus At The SIS

In April 2006 Ambassador Richard Woods, SIS Director General at the time, released the 2005 SIS annual report. In that report he emphasized the potential threat posed by local jihadis emulating the bombers in Madrid and London, the connections between New Zealanders and extremist organisations aboard, and the possibility that New Zealanders might supply sophisticated military-related equipment to hostile governments and organisations. Last week, again under Mr. Wood’s signature, the 2006 SIS annual report was published, just ten months after its predecessor. Besides the curious timing, there are several interesting aspects to the latest edition.

At the end of October 2006 Ambassador Woods retired and passed the director general’s job to Warren Tucker, former head of the Government Security Communications Bureau (GCSB). The GCSB is responsible for administering the electronic eavesdropping stations based in New Zealand as part of the Echelon electronic intelligence collection (i.e. intercept) network jointly operated with the US, UK, Australia and Canada. Unlike Ambassador Woods, Mr. Tucker is a long serving intelligence professional, and although questions remain about Mr. Wood’s relationship to intelligence agencies prior to his appointment as SIS Director General in 1999, there is no doubt that Mr. Tucker is a bonafide spy, albeit of the engineering geek rather than cloak and dagger persuasion. The 2006 SIS annual report therefore represents a transitional document that is the product of the overlap of both men’s tenure in the job. This is important because although the 2006 report was submitted under Mr. Wood’s signature, it has a heavy dose of Mr. Tucker’s views embedded in it. Since the focus of the 2006 report is remarkably different than that of 2005, this gives the appearance that Mr. Woods presided over the shift in focus. That makes it easier for Mr. Tucker to deepen the shift in the 2007 report without drawing attention to the remarkable discrepancies between his threat perspective and that of his predecessor.

The major discrepancy is in the primary threat assessment. Rather than local jihadis, the 2006 report focuses on the activities of foreign intelligence organizations operating in New Zealand. This begs some questions. What happened to those local jihadis? None were arrested, none were deported (the hapless Yemeni flight school student deported last year was not a local), and in fact, nothing in the way of domestic jihadis has materialised since Mr. Woods warned that there were Islamic subversives in our midst. Either the 2005 report was wrong, or it was politically contrived to take advantage of ongoing Islamophopia for self-serving bureaucratic purposes, or somehow the SIS countered all of the local jihadi threats so efficiently that no one, not even supposed jihadi supporters, got wind of it. Equally interesting is that the 2005 report makes little mention of foreign intelligence agencies operating within New Zealand. Hence, in the space of ten months what once was the major threat no longer is and what was not even on the threat horizon then is now foremost amongst our security concerns.

The 2006 report highlights the presence of foreign intelligence operations on New Zealand soil. Given the recent arrest of a Chinese national on purported espionage charges, claims about foreign intelligence operations appear to centre on those of the Peoples Republic of China (PRC). They certainly are not the only foreign government collecting intelligence in New Zealand—one can assume there are several, including allied countries and non-governmental entities—but Mainland Chinese operations appear to be of most concern to the SIS.

To be sure, New Zealand is under no imminent threat of attack within or on its borders, at least from foreign agencies. The Chinese want to trade, not invade. But foreign-derived threats to New Zealand’s economic and environmental wellbeing, and to the stability and orientation of its neighbours, are more realistic and possible. This matters because besides the possibility of theft of economic assets, intellectual property or ongoing environmental depredation in and around New Zealand territory (for example, by illegal fishing by Asian and Russian fishing fleets), New Zealand has primary responsibility, along with France, for intelligence collection in the Southwestern Pacific. France handles French-speaking Polynesia, and New Zealand handles English-speaking island states. Given the increase in the Chinese presence throughout the region, and given the unpleasant surprises posed by unrest in the Solomons and Tonga and the coup in Fiji (which makes one wonder what exactly is the New Zealand intelligence capability in its primary area of responsibility), it is no wonder that the SIS would want to keep tabs on Chinese activities down under.

The issue is straightforward. The PRC is an emerging global power whose economic, diplomatic, cultural, political and military interests are expanding worldwide. As part of this it must extend the range of its intelligence collection capabilities as well. Unlike Western intelligence alliance partners, the PRC cannot tap into the Echelon network or receive intelligence streams via liaison relationships with the US, UK or other European powers. It has a growing spy satellite capability, but this is nowhere close to the array of orbiting spy platforms operated by Western powers, and is directed towards those powers in any event. Thus, the PRC has to extend the most basic of intelligence collection devices, the human intelligence agent, in places like the Southern Pacific where it has growing commercial and related interests. To do so it uses the Chinese expatriate community, much like Israel uses the Jewish Diaspora as the first line of its intelligence collection network. Given the rising tide of Chinese emigration and settlement throughout the Pacific Rim and beyond, this makes perfect sense and provides Chinese spies with good cover for their activities. Using business and student visas, the PRC can plant operatives in far-flung corners of the world and activate them at a time of its choosing once they have “settled in” as residents of their new countries. Besides so-called non-official cover agents (people posing as something other than what they really are) and official cover agents (embassy personnel engaged in intelligence activities outside of the scope of their diplomatic license), there are contract assets employed as well (i.e. people who are paid for information or services). The latter are the most likely to be drawn from outside resident Chinese communities.

Intelligence operations are defensive and offensive in nature. Defensive intelligence operations seek knowledge of things that can threaten the home regime. For the PRC, this would involve monitoring dissident communities abroad, including the Falun Gong and student pro-democracy activists as well as renegade businessmen chafing under the strictures of one-party dominated Chinese crony capitalism. On the offensive side, intelligence operations involve gathering information about things that the home government does not have or needs to know. In New Zealand, this could involve economic and scientific espionage in a variety of industries where Kiwi ingenuity has led to world-firsts, but in which intellectual property rights make legal acquisition of technologies currently prohibitive. It is most likely to focus on the burgeoning New Zealand small arms and component industries that export to Western weapons manufacturers, but which are prohibited from doing business with the PRC. It would therefore be extremely valuable for Chinese intelligence assets to get close to the design specifications of advanced avionics or guidance technologies manufactured in New Zealand for use in UK or US weapons systems. Rather than spend 20-30 years developing such a capacity, an intelligence operation focused on copying or stealing such information will save the PRC time and money in its quest to be the military equal of its Western competitors.

It makes sense for the PRC (and others) to engage in intelligence operations in New Zealand. That makes it equally reasonable for the SIS, as the lead counter-intelligence agency in the country, to focus on those operations. This is the traditional stuff of the intelligence business: spying and counter-spying on other state intelligence agencies. Diverted by post 9/11 counter-terrorism concerns that were overly politicized and exaggerated in New Zealand and elsewhere by self-serving bureaucrats and politicians, the re-orientation of the SIS focus is a welcome turn to professionalism. However, it remains to be seen if the damage done to the SIS by its inbred institutional culture and past bumbling can be corrected with a shift in leadership and the emphasis seen in one annual report. If the measure of professionalism under liberal democracies is autonomous, independent intelligence collection and reporting, then the SIS still has a considerable way to go.

A former advisor and consultant to several US intelligence and security agencies, Paul G. Buchanan is the Director of the Working Group on Alternative Security Perspectives at the University of Auckland.

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