I have been following recent debates in the corporate and social media about whether it is a good idea for NZ to join what is known as “AUKUS Pillar Two.” AUKUS is the Australian-UK-US nuclear submarine building agreement in which the US and UK will provide Australia with the know-how and training on how to build and operate a small nuclear submarine fleet beginning in the 2030s. It has two components.
Pillar One involves the submarines themselves, which will be home ported at HMAS Stirling outside of Perth. Beginning in 2027 US Virginia-class and UK Astute-class attack subs (from which the future AUKUS-class Australian submarines will incorporate design features) will start rotating through HMAS Stirling so that Royal Australian Navy (RAN) and civilian personnel at HMAS Stirling can become familiar with nuclear submarine technologies and home port surface operations. The US will sell Australia up to three Virginia-class Block IV and Block VII subs beginning in the early 2030s and delivery of five new AUKUS submarines (designated as SSN-A’s) will begin in the mid 2040s. RAN crews are already attending the US Navy nuclear propulsion school in South Carolina and they will also join UK and US Astute- and Virginia-class boats on deployments as a part of their training. The project envisions the Royal Navy receiving SSN-A boats to replace their Asute-class fleet beginning in the early 2030s, and for the RAN to have a nuclear fleet of eight boats by 2050. Although nuclear propelled, they will not be nuclear armed. They are attack submarines whose main roles are to kill other submarines, surface vessels and land-based targets with conventionally armed torpedoes and cruise missiles. They are also tasked with intelligence-gathering missions involving technical, signals and even human collection methods.
Pillar Two of the AUKUS agreement involves complex technology research, development and transfers. The primary areas of focus will be on computer and cyber technology (including Artificial Intelligence, Quantum Computing and classified undersea technologies), hypersonic and counter-hypersonic platforms (already in progress), and Radar Capability, including the Deep Space Advanced Radar Capability (DARC) that will see tracking stations built in the Pillar One Countries. Pillar Two is designed to move beyond basic systems interoperability between the military allies, which is already in place, and integrate the military-industrial complexes of the three partners in ways that will not only lead to more seamless integration of complex technologies but also help create and expand high tech development hubs in each country, but especially in Australia and the UK. This is seen as having tremendous “trickle down” benefits for the civilian economies of each country as the flow-on effects of Pillar Two ripple into related industries up and down the supply, service, and delivery chains and their associated labour markets.
In March 2023 then Defense Minister Andrew Little of the Labour Party said that NZ was interested in discussing potential involvement in the non-nuclear aspects of Pillar 2, and in July 2023 US Secretary of State said that the “door was open” for countries like NZ to join the agreement. In December 2023 new Prime Minister Christopher Luxon reiterated his government’s interest in potentially joining in the non-nuclear aspects of Pillar Two, something that was followed by an announcement in February 2024 by Australia that it would begin to brief NZ officials on developments with regard to Pillar Two. However, after losing the October 2023 election the Labour Party reversed course and announced its opposition to participating in Pillar Two, and even the Grande Dame of the Labour Party, former NZ Prime Minister and UNDP chief Helen Clark, came out strongly against it. She has been joined in her opposition by a number of prominent NZ academics, peace, non-proliferation and disarmament campaigners, human rights and environmental activists, civil society organisations and left political movements as well as former diplomats.
Their concerns range from not wanting to jeopardise NZ’s trade relationship with the PRC, which has strongly denounced AUKUS as a provocative attempt to militarily counter and encircle it in the Western Pacific (and there is truth to that), which has a history of using trade as a retaliatory weapon in order to show its displeasure with other State’s behaviour, and upon which NZ is significantly trade-dependent, to fears of a nuclear arms race and/or great power conflict in the Southwestern Pacific that would have a disastrous impact on Pacific Island societies, economies and environments.
That latter point is significant because the permanent basing of nuclear submarines at HMAS Stirling appears to be in violation of the 1997 Treaty of Rarotonga declaring the South Pacific to be a nuclear-free zone.The maps of the South Pacific nuclear-free zone attached to the Treaty include the Australian West Coast fronting the Indian Ocean, and the Treaty prohibits the storage of significant quantities of fissile material or nuclear-processing facilities within the Zone. So the AUKUS agreement is seemingly in violation of the Treaty, which if so sets a dangerous precedent (AUKUS supporters claim that at worst the signatories exploited loopholes in the Treaty that make the agreement compliant with it). This can now open the door for other States to station nuclear powered submarines in the region, say for example, the French in New Caledonia or French Polynesia or the PRC in the Solomon Islands (thanks to the recently signed bilateral security agreement between the two countries). That would not be good from a strategic or arms control standpoint and would fulfil the darkest dreams of the non-proliferation community.
These opposition voices are countered by security experts and conservative political observers who see closer relations with AUKUS as enhancing NZ’s security in a rapidly deteriorating international security environment (in which militarily aggressive Russia and the PRC are seen as leaders of an authoritarian, anti-democratic, anti-Western bloc emerging from the Global South), and which also has great economic benefits for NZ should it join Pillar Two.
That is the foundation of the debate I mentioned at the beginning of this essay. Put crudely, Lefties do not want NZ involvement in Pillar Two. Righties do.
All of this seems to me to be a bit of a moot point. I hopped on the consultancy social media account to outline two reasons why, and I have expended them below.
First: the NZDF and GCSB (as part of 5 Eyes) will share AUKUS-related military technology and signals and technical intelligence collection advances because of their ongoing integration with Australian and US maritime operations and 5 Eyes partnership, especially when it comes to Western Pacific Anti-Submarine Warfare (ASW) roles. The incorporation of new P-8 long range patrol and ASW aircraft into the RNZAF and upgrades to the RNZN frigates have been done with that complex interoperability in mind. The NZDF already uses the principle of interoperability when working alongside its military partners–the US, UK and Australia being foremost among them– so whatever systems integration upgrades that result from AUKUS will be shared with NZ in any event. As it is, the NZDF already communicates with US and Australian submarines as a matter of course, so it will continue to do so once the nuclear-propelled ships come on board (remember that submarine hunters and surface patrol platforms need to distinguish friend from foe, and the best thing to do in that case is to ask upon contact or be alerted in advance by friendly forces). So as far as non-nuclear military technology sharing with the NZDF goes, it is a done deal. NZ does nothing (at least publicly) and yet it still gets to play with the military “big dogs.”
Also keep in mind that submarines are excellent signals intelligence collection or intercept platforms, particularly when it comes to undersea fiberoptic telecommunications cables. So upgrading to nuclear powered subs by the RAN will expand the range and operational capabilities of its maritime signals intelligence collection platforms as well as improve its ability to monitor hostile naval movements above and below the water line. The NZDF and GCSB will benefit from that, again, without having to do anything different than what they are doing already but with improved intelligence-gathering capabilities as a result.
Secondly, Australia, the UK and the US high technology sectors will not gift NZ firms a slice of the Pillar 2 pie for competitive and political reasons. Why allow the small high technology sector of a non-nuke “freeloading” country to benefit when AUKUS firms can benefit instead? Plus, AUKUS high technology sectors employ voters, have entrepreneurial lobbies and involve established economies of scale, so why share the Pillar Two market with what essentially would be a start-up upstart that has no political influence and electoral impact in the AUKUS countries themselves?
In effect, for operational as well as economic and political reasons, NZ involvement in Pillar Two is improbable. It will be briefed about Pillar Two as announced, but an invitation to join the endeavour faces opposition both from within and from without NZ. It therefore seems that the current government is engaging more in political and diplomatic posturing when it speaks of NZ’s involvement in Pillar Two rather than realistically assessing the prospects of that ever happening.
In that light, perhaps the fears of Pillar Two opponents are overblown?
Very thorough. I understand that the current technical cooperation programme between the Five countries covers all of Pillar 2 and much, much more.. But that is primarily research based. Pillar 2 is about production and I understand that membership is on an all or nothing basis and there is a cost. If produced, you buy, put crudely. Time will tell.
NZDF access to sensitive technology thru FVEYS is indeed a moot point. They have access incl thru FMS (where ITARs otherwise denies access), while selected defence R&D is shared thru TTCP. The latter involves a small no of defence scientists. But P2 is focused on partner defense industries – not just the warfighters. The aim is to grow the shared defence industrial base. Because US can’t build enough ships, let alone sustain a competitive edge in military-relevant emerging technologies. Could NZ offer much? NZ hardly has a defense industry – maybe another moot point. But NZ SME and academia have credible expertise in quantum, space (rockets and propulsion), cyber, UAVs/autonomy (perhaps others) – to mutual benefit. NZ is also an exceptional launch ground for testing and developing space and aviation related technologies – some of which is already occurring. I wouldn’t write off NZ’s ability to add value. However, like the USS Buchanan visit, if the answer is likely to be no, then the question is best not to be asked.
Thanks Greg,
That adds detail to the (moot?) question.
I view Aukus as a technological sharing agreement and not a means of improving security/deterring China from undertaking military aggression. Australia’s embrace of the nuclear-powered submarines and missile craze will last until reality hits home. Putting all their eggs into one basket will come back to haunt them.
Could New Zealand benefit from joining Aukus Pillar Two? Luxon’s Government lacks the smarts, courage, and vision required to restructure New Zealand’s economy around high-tech manufacturing and blending national security/defence matters with economic growth.
Luke,
I agree that a tech sharing agreement under Pillar 2 would benefit NZ immensely, but as I mentioned in the post the military-industrial sectors in the UK, US and OZ will oppose that (and they vote), NZ has a tiny high tech sector (other than Rocket Lab) on which to build scale, and above all, a primitive capitalist mindset that prioritises primary good exports over everything else. So long as the farm lobby dominates economic discussions and the focus of NZ trade policy is on primary rather than value-added goods, then NZ will not get a look in edgewise when it comes to Pillar 2. That is why arguing the point is moot.
I will say, however, that I disagree with you on Pillar 2 having no military/security implications. That is the whole point of the exercise. What it will not do is deter the PRC from continuing its strategic expansion. It is well aware of what AUKUS is about and has planned accordingly.
Pablo well said concerning the farm lobby and China’s reaction to AUKUS. How AUKUS will fail to deter China from its current path is why I like the focus on other tech-sharing elements of the agreement. So, you are correct concerning AUKUS and military/national security goals.
My above comment was a poorly worded attempt to avoid covering matters not covered topically in your post. (The impact of AUKUS on the Australian military’s force structure springs to mind).
Also, if AUKUS Pillar One falls over, does the second tier go the same way?