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10:00 AM ET, Monday, August 14, 2023

The Cipher Brief curates open source information from around the world that impacts national security. Here's a look at today's headlines, broken down by region of the world:  

In the Americas

U.S. Imports from China on the Decline.  The Wall Street Journal is out with a report that examines the economic ‘break up’ between the U.S. and China’s as trade relations continue drifting apart.  China accounted for just 13.3% of U.S. goods imports in the first half of 2023, below a peak of 21.6% in fall of 2017 and the lowest since 12.1% in 2003.  Slow-moving shifts in supply chains, which started with Trump administration tariffs on Chinese goods in 2018, have led to more imports from Mexico, Europe, and other parts of Asia.  The decline is a broad trend across sectors including smartphones, semiconductors, apparel, furniture, and other products.  The technological and trade tensions between Beijing and Washington, as well as supply chain de-risking trends following the COVID pandemic and national security concerns, have contributed to the decline.  Wall Street Journal

Peru & U.S. Form New Security Agreement to Combat Airborne Drug Smuggling.  Peru has announced a new security agreement with the U.S. in an effort to stop planes belonging to drug cartels from entering Peruvian airspace. The deal will permit new intelligence and training support for Peru’s Air Force.  An earlier pact between the U.S. and Peru was indefinitely suspended 20 years ago due to an incident in which the Peruvian Air Force shot down a misidentified plane, killing two U.S. citizens.  Peruvian Defense Minister Jorge Chavez said airspace interdictions under the deal will be conducted with non-lethal means.  Reuters

Western Europe

Danish Air Force Intercepts Russian Bombers Near NATO Airspace.  The Dutch Royal Air Force reported Monday that it intercepted two Russian bombers identified over Denmark that were headed in the direction of NATO airspace near the Netherlands.  Dutch F-16s deployed on Monday morning intercepted the Russian bombers before they could enter NATO airspace.  An air force spokesperson said aircraft are intercepted if they do not offer a flight plan, lack a unique identifying code, and do not partake in two-way conversation.  The spokesperson added that it is not unusual for Russian planes to breach or closely approach the airspace of NATO members.  The Danish Ministry of Defense could not immediately be reached for comment on the incident. Reuters

Bomb Alert Triggers Evacuation at Eiffel Tower.  France BFMTV reported Saturday that a bomb threat prompted an evacuation at the Eiffel Tower for several hours.  According to BFMTV, traffic was diverted, a security perimeter was organized in the area, and a squad of deminers were deployed to the tower.  A spokesperson for SETE, the operating company of the monument, called the occurrence “rare.”  The Eiffel Tower has since reopened to the public.  CNN France 24

Central and Eastern Europe

Ukraine Makes ‘Tactically Significant’ Progress in Southern Counteroffensive.  Over the weekend media reports and analysts report that Ukraine has made progress in key areas along two vectors of its ongoing counteroffensive against Russian forces.  The Institute for the Study of War (ISW) says that Ukraine’s military made ‘tactically significant’ progress in reaching the village of Robotyne, located in the western Zaporizhia Oblast.  Moscow is reportedly redeploying forces from other regions to defend against the advancing Ukrainian units, which is also notable given the amount of resources the Russian military had dedicated to defending the region.  The moves are part of Ukraine’s push to reach the sea of Azov and sever the land bridge between Crimea and mainland Russia and media reports say that Ukraine is making slow but steady progress along two main lines of advance in the direction of the Russian-occupied cities of Berdiansk and Melitopol.  General (Ret) Phil Breedlove told The Cipher Brief that Kyiv’s progress in the south looked “promising” and says Ukraine has slowly and deliberately progressed thru the first line of Russian defenses, and is working thru the second line.  Russia has reportedly built the most extensive defensive network “since WWII” with trenches, tank traps and minefields supported by artillery and air support.  Ukraine’s military has advanced 10-12 miles along both fronts since the start of the counteroffensive in early June.  Analysts say that Ukraine’s military faces a long and tough fight to continue progressing through Russia’s defenses, but British intelligence reported over the weekend that Russia’s military had faced “particularly intense attrition and heavy combat on the front line.”  In Northeastern Ukraine Russia’s military is attempting its own offensive operations particularly around the city of Kupiansk, forcing Kyiv to deploy forces there to defend.  Over the weekend Russia’s military reportedly struck Ukraine “328 times” with artillery strikes in one day.  NY Times ISW CNN Reuters The Cipher Brief 

F-16 Training for Ukrainian Pilots Faces Delays and Uncertainty. Ukrainian pilots are not expected to complete their training on the U.S.-made F-16 before next summer. There has been a series of delays in the West’s instruction program for the jet. When the U.S. backed the idea to train the pilots in May, hopes among officials in Kyiv were high after Denmark and the Netherlands volunteered to lead a training effort. Officials in Kyiv say the F-16 will provide a significant military edge for use in the counteroffensive. U.S. officials are describing the complexities of putting together a new international initiative as the reason for the delays. General (Ret) Phil Breedlove says he believes that the US will eventually provide Ukraine with F16’s but says he sees some “indications that we are purposely slowing this process down” over fear that it could lead to Russian escalation in the region.  Washington Post  The Cipher Brief 

Ukraine's Port City of Odesa Opens Beaches for First Time Since War Began.  Local Ukrainian officials announced Saturday that several beaches in the Black Sea port city of Odesa were reopened for swimming for the first time since Russia invaded the nation in 2022.  The city has been attacked almost relentlessly with drones and missiles, and the water is filled with hundreds of sea mines that have exploded on beaches.  Despite this, Odesa Governor Oleh Kiper said that the city’s civilian and military administrations decided to open the coast from 8am to 8pm, with the exception that beaches will close during air raid alerts.   Reuters CNN

Russian Warship Detains Cargo Ship in Black Sea following Warning Shots.  A Russian warship reportedly fired warning shots at a cargo ship in the southwestern Black Sea on Sunday.  Russia’s defense ministry says that the Vasily Bykov patrol ship fired automatic weapons on the Palau-flagged Sukru Okan cargo vessel, claiming that it failed to respond to requests to stop for inspection. The ministry added that it forcibly stopped the vessel and boarded it with the support of a Ka-29 helicopter before letting it continue on its journey.  The ministry claimed the cargo ship was headed towards the Ukrainian port of Izmail, though a Turkish defense ministry official and shipping data said it was headed for Romania.  Ukrainian presidential advisor Mykhailo Podolyak called the incident “a clear violation of the laws of the sea” and an “act of piracy”.  A Turkish defense official says that Ankara is investigating the incident.  Reuters

Russia Vows Retaliation Over Latest Attack on Crimean Bridge.  Over the weekend, Russia said that Ukraine again targeted the Kerch Strait bridge, a 12-mile long bridge which links Crimea with Russia.  Russia’s foreign ministry condemned the attack and vowed that Russia would retaliate.  Russia’s defense ministry says that Ukraine fired two S-200 missiles in the attack, which Russia says were shot down and that no damage occurred to the bridge.  Reuters Al Jazeera 

Russia Intercepts 20 Drones Over Crimea.  Russia’s defense ministry said Russian defenses shot down or jammed 20 Ukrainian drones on Saturday that were targeting Moscow-annexed Crimea.  No casualties or damage were reported.  Kyiv officials have neither confirmed or denied Ukraine’s part in the attacks.  The latest incident comes amid an increase in drone attacks targeting both Moscow and Crimea in recent weeks. Russian officials say that in the latest attack, 14 drones were shot down and six were defeated using electronic jamming measures.   Associated Press Deutsche Welle

Analysis: Wagner Head Prigozhin Could Be Dead or Stage Another Coup in Six Months.  Bellingcat journalist Christo Grozev told the Financial Times that he predicts Wagner Group leader Yevgeny Prigozhin will be dead or will attempt to stage another coup against the Russian leadership in the next six months.  Grozev correctly predicted in January of this year that Prigozhin would move against Moscow within six months, citing increased telephone communication between Russia’s senior military, as observed by Bellingcat at the time.  His latest prediction comes amid reports that the deal that ended the Wagner rebellion in June is falling apart, with the Institute for the Study of War (ISW) citing sources saying that hundreds of Wagner fighters are returning from exile in Belarus to Russia and are preparing to “activate” by the end of August.  A Russian source said this may be because Belarusian President Alexander Lukashenko is refusing to fund Wagner as he expected Russia would be responsible for the mercenary group.  ISW noted that the validity of the claims or how Prigozhin or the Kremlin will act are all unclear.  Britain’s defense ministry did say Sunday that Russia has stopped funding Wagner and has acted against some of Prigozhin’s business interests.  Financial Times South China Morning Post

Asia and Oceania

Taiwanese Vice President Visits U.S. Ahead of Latin America Tour.  Taiwanese Vice President William Lai arrived in New York on Saturday during a sensitive U.S. stopover on his way to Paraguay.  China has condemned the trip and some Taiwanese officials have expressed concern it could prompt more Chinese military activity around the island.  Lai is the front-runner to win Taiwan’s upcoming presidential elections in January.  Lai is officially making transit stops within the U.S. on his way to Paraguay, where he will attend the swearing in of its president. Paraguay is one of the few countries which retain formal diplomatic ties with Taiwan.  China has repeatedly denounced Lai’s trip and has pledged to take “resolute and forceful measures” to protect its sovereignty. China is likely to launch military drills this week near Taiwan to intimidate voters ahead of next year’s election, according to Taiwanese officials.  Reuters Al Jazeera New York Times France 24

China Urges Philippines to Cooperate on Easing South China Sea Tensions.  Chinese Foreign Minister Wang Yi is urging the Philippines to work with Beijing to reduce tensions in the South China Sea, according to the official Xinhua news agency on Saturday.  Wang reportedly made these comments during a trip to Malaysia and Singapore on Thursday and Friday, where he argued that Beijing has repeatedly shown willingness to engage in bilateral dialogue to settle differences with Manila.  He also accused the U.S. of taking advantage of the situation and fueling confrontation between the two sides.  Tensions over territorial disputes in the region have most recently escalated over the Second Thomas Shoal, where Filipino troops are stationed on a grounded warship in an effort by Manila to maintain a territorial presence.   Reuters South China Morning Post

Chinese State Media Argues Developed Nations Not Avoiding Belt and Road Forum.  The Chinese state-backed tabloid Global Times on Saturday refuted claims that developed nations were avoiding Beijing’s annual Belt and Road Forum, while admitting that most of the world leaders invited that were planning to attend the event were from developing countries. In July, the Wall Street Journal published a report saying that the heads of some European nations such as France, Italy, and Germany were shunning this year’s summit in the fall. The Global Times said that Beijing had not actually invited the leaders of some of the developed nations cited in the report, suggesting that they cannot “shun” the event because their presence was not requested.  However, the report added that Beijing is willing to accept their attendance if they wish to join the gathering. The Chinese foreign ministry has not commented.  More than 150 nations, most of them in Africa, have signed up to participate in the initiative.  Reuters

Militants Attack Pakistani Military Convoy Escorting Chinese Nationals. Militants attacked a Pakistani military convoy on Sunday as it was escorting a delegation of Chinese nationals to a construction project, according to the Pakistani military and China’s consulate in Karachi. China has heavily invested in its Belt and Road Initiative in the province of Balochistan for its rich minerals, despite a separatist insurgency in the area. The militants used small arms and hand grenades during the attack and two militants were killed with no harm to any military personnel or civilians, according to the military’s public relations wing.  The Balochistan Liberation Army (BLA) claimed responsibility for the attack and said it inflicted multiple casualties.  No other reports have confirmed any casualties. The BLA has accused the government in Islamabad of exploiting the area’s natural resources and has targeted Chinese interests in the area in recent years for support of this effort.  Reuters

Middle East and Northern Africa

UN Finishes Removing Oil from Crumbling Tanker off Yemen.  The UN announced on Friday that it had completed the removal of more than 1 million barrels of oil from a deteriorating supertanker off Yemen’s Red Sea coast, likely preventing a disastrous environmental catastrophe.  For years, analyst, including Cipher Brief Expert Norm Roule, have cautioned about the risks of the tanker exploding, an event that could have threatened the entire Red Sea coastline.  Achim Steiner, administrator of the U.N. Development Program, said “it is a major moment of having averted a potentially catastrophic disaster.” The ship, currently used for storage, has for three decades been anchored off Yemen. Maintenance operations have been suspended since 2015 due to the Yemen war.  It took 18 days for salvage crews, working in a conflict zone littered with sea mines, to offload the oil, which will be sold. U.N. Secretary-General Antonio Guterres and U.S. Secretary of State Antony Blinken both commented on the situation, approving the safe removal of the oil.  Reuters BBC Deutsche Welle

Iran Central Bank says Unfrozen South Korea Assets Will be Used for 'Non-Sanctioned Goods.'  Iranian central bank head Mohammad Reza Farzin said Saturday that all of Tehran’s blocked funds in South Korea, amounting to $6 billion in assets, had been unfrozen and would be used for "non-sanctioned goods.” A day earlier, the U.S. said there would be limitations on what Iran could do with the money under an agreement that has led to the potential release of five Americans who are under arrest in Iran.  John Kirby, White House National Security Council spokesperson, said Iran could only use the funds "to buy food, medicine, medical equipment that would not have a dual military use." The assets would be transferred to six Iranian banks in Qatar, and the five detained Americans will be permitted to leave the country once the money is unblocked. Farzin congratulated "the foreign exchange diplomacy team for successfully releasing seized foreign currency resources."  Reuters Associated Press

Iran Reportedly Slowing Uranium Enrichment.  The Wall Street Journal reports that Iran is slowing enrichment of near-weapons grade uranium and reduced its stockpile.  According to unnamed “people briefed on the matter,” Iran allegedly diluted some of its 60 percent enriched uranium and grew its stockpile at a slower rate than between February and May, when it enriched nine kilograms of material.  The report says that Iran still has enough enriched uranium to build two nuclear weapons, though experts say Tehran has not decided to attempt to do so.  The development comes amid reports that Iran is considering releasing U.S. citizens detained in Iran.  Despite little hope of reviving the 2015 Iran Nuclear deal, Washington has reportedly pushed for Iran to pledge not to further enrich uranium beyond 60 percent, not send missiles to Russia, and halt proxy attacks in the region.  The U.S. would unfreeze Iranian assets frozen abroad in response.  Critics of the deal say that the U.S. move will reward Iran for taking U.S. hostages, allow for a “minor pause” in nuclear enrichment while Tehran continues its practice of military support for Russia’s war in Ukraine and other destabilizing regional activities.  Wall Street Journal

Palestine Accepts First Saudi Ambassador. Palestinian officials welcomed their first Saudi Arabian ambassador on Saturday. This news comes even as Saudi Arabia considers closer diplomatic ties with Israel. Saudi Arabia has championed the Palestinian cause and avoided official ties with Israel, but the U.S. has been pushing for normalization of relations between the two Middle Eastern states. Last week, Palestinian Foreign Minister Riyad al-Maliki said that the Western-backed Palestinian Authority is hoping to engage with Saudi Arabia over their concerns regarding the possible normalization with Israel.  Israeli, Saudi, and U.S. officials have said that any such arrangement is still some way off due to unresolved issues, namely the escalating violence within the occupied West Bank.  Reuters

Sub Saharan Africa 

Niger Military Leaders To Prosecute Ousted President.  Niger coup leaders announced that they will prosecute ousted President Mohamed Bazoum for high treason and undermining state security.  A Niger military spokesperson said on Sunday that the junta has “gathered the necessary evidence” to charge Bazoum, who has been held at the president’s official residence with his family in Niger’s capital Niamey since the coup on July 26.  Allies of Bazoum are urging the U.S. and U.N. to intervene to save his life, claiming that he is being held in poor conditions and that his health is deteriorating, a claim that the junta denies.  The development comes after a delegation of Nigerian Islamic scholars met with Niger’s coup leader Abdourahamane Tchiani in Niamey.  The group said the junta has reportedly agreed to hold talks with leaders of the West African bloc ECOWAS to de-escalate tensions from the crisis.  Al Jazeera Associated Press Reuters

Cyber and Tech

White House S&T Director Says Novel Executive Order on AI Under Development.  The White House is accelerating work on an executive order (EO) concerning AI risks and providing federal agencies with guidance on the technology’s use, according to Arati Prabhakar, director of the White House Office of Science Technology and Policy.  Interviewed by CyberScoop at the Def Con conference in Las Vegas, Prabhakar recounted how President Biden’s concerns have grown over the technology, prompting a stepped-up EO process. Prabhakar said it’s not only speed that is different about this approach, “it’s just a completely different process.”  She noted that federal agencies are treating the issue with urgency, adding “they know it’s serious, they know what the potential is, and so their departments and agencies are really stepping up.”  The White House effort coincides with Congressional initiatives to develop AI governance rules, including Senate Majority Leader Chuck Schumer’s moves to lay groundwork for major AI legislation.   Prabhakar recalled that many of the hopes everyone had for technology have been realized, alongside some “nightmares (that) have come with that.“  CyberScoop

Russian Lunar Mission Begins Transmitting Scientific Data Enroute to Moon Landing.  Scientific instruments aboard the Russian Luna-25 lunar lander have begun transmitting initial data streams as the spacecraft continues on its transit to the moon with the goal of being the first to find ice on the lunar surface.  A Soyuz 2.1 rocket carrying the Luna-25 lander lifted off from a Far East cosmodrome on Friday on a mission that parallels an Indian lunar lander’s mission – which began in July — to achieve a soft landing on the moon’s south pole.  The Russian space agency, Roscosmos reported that "fhe first measurement data on the flight to the Moon has been obtained, and the project's scientific team has begun processing it."  The agency added that “all systems of the automatic station are working properly, communication with it is stable, the energy balance is positive.”  The implications for Russia of a successful Luna-25 mission are significant, as Moscow is likely to claim that the West’s sanctions have not restrained the country’s space ambitions.  Roscosmos announced Friday that more lunar missions will follow, including the possibility of a joint Russian-China crewed mission and even a lunar base.  Reuters

Japan Plans Cyber-Defense Information Network with Indo-Pacific Nations.  Japan’s Foreign Ministry is developing plans to build an Indo-Pacific information network to defend against cyberattacks from countries like Russia and China.  A special focus of the network will be on Pacific Island countries that lack adequate defenses against cyberattacks.  Attack indicators and threat actor methods would be shared within the network, which Japan projects as a bridge between the U.S., Australia and other advanced countries in the region and developing countries.   Support for bolstering foreign cyber capabilities will be part of the Foreign Ministry draft budget for FY2024, with the Indo-Pacific as a priority region.  In addition to providing equipment, Japan plans to provide cyber know-how through joint training sessions.  Japan is expanding cyber capabilities within the Quad framework, along with the U.S., Australia and India, and with the Association of Southeast Asian Nations.  Japan reportedly will examine other ways of extending the Quad’s so-called joint principles of cyber defense to other areas of the Indo-Pacific region where the approach can be shared.  Nikkei Asia

Cyber Safety Board To Examine Cloud Infrastructure in Wake of Microsoft Breach.  The Department of Homeland Security (DHS) has announced that the Cyber Safety Review Board (CSRB) will conduct a review of the breach of Microsoft’s email authentication system which is thought to have been carried out as a cyber-espionage operation linked to China.  The CSRB is a hybrid government-private sector body that began operations in early 2022 in the wake of the massive SolarWinds cyberattack.  As part of a larger examination of “malicious targeting of cloud computing environments,” the CSRB will scrutinize the Microsoft episode.  Rob Silvers, the CSRB chair and DHS undersecretary for policy, said “we must as a country acknowledge the increasing criticality of cloud infrastructure in our daily lives and identify the best ways to secure that infrastructure and the many businesses and consumers that rely on it.”  In this case, CSRB will explore how cloud identity management and authentication can be bolstered by government, industry, and cloud service providers (CSPs), with cybersecurity recommendations that can be implemented by all stakeholders.  The board’s recommendations will be shared with CISA for follow-on action to protect government systems and accounts.  CISA Director Jen Easterly said in a statement that an “effective shared responsibility model requires a persistent focus on potential systemic risks in cloud environments,” adding the board’s findings will “advance cybersecurity practices across cloud environments and ensure that we can collectively maintain trust in these critical systems.”  CyberScoop The Record BleepingComputer Axios

Iraq Lifts Ban on Telegram Messaging App After Data Requirements Met.  Iraq’s telecommunications ministry has announced the lifting of a ban on the Telegram messaging app that had been imposed last week over security concerns about data leaks.  A ministry statement explained the move, saying "the company that owns the platform responded to the requirements of the security authorities that called on the company to disclose the entities that leaked citizens' data."  The ministry ban on Telegram was triggered, it said, by the messaging app’s failure to respond to requests to suspend platforms leaking both official state and personal data of Iraqi citizens.  According to the ministry, Telegram has "expressed its full readiness to communicate with the relevant authorities.”  Telegram responded to a Reuters inquiry by confirming its moderators closed several channels for sharing personal data, while noting that “no private user data was requested from Telegram and that none has been shared."  Reuters

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