10:00 AM ET, Thursday, January 11, 2024
Daily national security briefings aren’t just for the president anymore. The Cipher Brief uses AI partnered with human analysis and expert perspective to keep you up-to-date on national security news from around the world.
Here’s what’s happening now:
THE TOP STORIES
UN Security Council demands Houthis stop Red Sea shipping attacks.
Iran seizes tanker off Oman.
U.S to send delegation to Taiwan immediately after presidential election.
US Set to Push Zelensky at Davos for Clearer War Plan.
Fake News & Tech Risks top global concerns at Davos 2024.
FBI, NSA Directors Warn of Mounting Foreign Threat to U.S. Elections.
ISRAEL AND HAMAS WAR
UN Security Council demands Houthis stop Red Sea shipping attacks. The UN Security Council has passed a resolution demanding that Yemen's Houthi rebels cease attacks on ships in the Red Sea and release the seized Japanese-operated Galaxy Leader. Eleven council members voted for the measure, with four abstentions- Algeria, China, Mozambique and Russia. The US accuses the Iran-backed Houthis of carrying out 26 attacks on commercial ships since capturing the Galaxy Leader. The Houthis claim they target Israeli-linked vessels in protest against the Gaza conflict. The resolution notes the right of UN member states to defend their ships, implicitly endorsing Operation Prosperity Guardian, a US-led task force to protect commercial shipping from Houthi attacks. Al Jazeera
Blinken urges Palestinian Authority reforms as step toward Gaza governance. Secretary of State Antony Blinken visited Ramallah yesterday, where he urged Palestinian President Mahmoud Abbas to reform the Palestinian Authority (PA) so that it would be able to govern Gaza once the war there is over. Speaking in Manama, Bahrain later, Blinken said Abbas was “committed” to reforms to make the PA a more effective governing organization. A senior PA official said the PA provided Blinken with a written proposal for reforms to be undertaken on issues including free speech, corruption and health care, but only in the context of a broader deal to end the war and rebuild Gaza. Israeli Prime Minister Benjamin Netanyahu has opposed PA control over Gaza and to the creation of a Palestinian state, but he said following his own meeting with Blinken earlier yesterday that Israel has “no intention” of permanently occupying Gaza or displacing its population. Associated Press New York Times Washington Post
Israel to confront accusations of genocide at World Court. The UN International Court of Justice began preliminary hearings on South Africa’s charge that Israel has committed genocide in Gaza. The hearings mark the first time Israel will defend itself in person in such a setting. In its submission to the court, South Africa said Israel has killed civilians, inflicted serious bodily and mental harm, and created conditions “calculated to bring about their physical destruction.” Israeli officials adamantly reject the allegations, saying they pervert the meaning of genocide as defined in the 1948 International Convention against Genocide and that a better case could be made against Hamas. Israeli President Isaac Herzog called South Africa’s claim “atrocious and preposterous.” Prime Minister Benjamin Netanyahu said last night that Israel is doing its “utmost” to avoid civilian casualties. The U.S. also has dismissed South Africa’s charges. National Security Council spokesman John Kirby called them “meritless, counterproductive, completely without any basis in fact whatsoever.” New York Times Reuters BBC Associated Press
Israel-Hamas war deals blows to Israeli economy and tech sector. The Israeli economy and tech sector have faced significant challenges since the Hamas attacks against Israel on October 7. The attacks and ensuing conflict have disrupted operations for many companies. They been forced to close facilities near the Gaza border, are facing labor shortages due to the call-up of Israeli army reservists and loss of both Palestinian and international workforce, and are dealing with canceled orders and investor hesitancy. There are also wider concerns about rising inflation and a potential decrease in foreign investment. Israel has taken several moves to address this, including by stabilizing the Israeli shekel, cutting interest rates to stimulate the economy, increasing foreign workers, and temporarily withdrawing some troops from Gaza. The government is also seeking to maintain support for tech companies, including with a $100 million fund. The Israeli tech sector itself is working on campaigns to boost confidence amid the uncertainty. New York Times
WHO cancels Gaza aid mission over safety fears, warns of dire food shortage. World Health Organization Director General Tedros Adhanom Ghebreyesus told a news conference on Wednesday that the WHO was forced to cancel a medical aid mission to Gaza this week because of security concerns. Tedros said the WHO has had to cancel several such missions since its last one on December 26 because of a lack of security assurances from Israel. WHO emergency medical teams coordinator in Gaza Sean Casey told reporters the need for food assistance across Gaza is urgent. He called the situation “absolutely horrific; there’s almost no food available.” Washington Post
Obstacles hinder Gaza aid; U.S. senators call on Israel to streamline truck inspections. Aid officials and two U.S. senators who recently visited Rafah say obstacles such as limited hours for border crossings and a landscape littered with rubble and destroyed roads are contributing to a growing humanitarian crisis in Gaza. The U.N. and aid groups warn the risk of famine is growing and that the health care system is collapsing while disease is spreading. Aid groups say that sometimes their convoys have come under fire from the Israeli military despite efforts to coordinate with passage in advance. An Israeli military spokesman denied the claim. Israeli officials also say there is enough food and water for civilians in Gaza but that the U.N. needs to find more staff, extend workers’ hours, and deploy more trucks to distribute the aid. Sen. Chris Van Hollen (D-MD) criticized the agreement governing aid delivery which requires each truck to submit to Israeli inspections to remove anything that could benefit Hamas. Van Hollen called the process “totally arbitrary” and “cumbersome.” Sen. Jeff Merkley (D-OR) called on Israel to streamline inspections and ensure aid can be delivered safely in Gaza. New York Times
China and Russia push for Israel-Gaza ceasefire and two-state solution as foreign ministers vow to boost Brics influence. Chinese Foreign Minister Wang Yi and Russian Foreign Minister Sergey Lavrov discussed cooperation in enhancing the international influence of the BRICS group, pushing for a ceasefire in the Israel-Gaza conflict, and supporting a two-state solution for Israel and Palestine. They also touched on other international issues, such as the Ukraine war. Russia is set to host the BRICS summit later this year under the theme of "Strengthening multilateralism for equitable global development and security." The call came on the same day that Chinese President Xi Jinping had a video call with Finnish President Sauli Niinisto, where they discussed China's role in seeking peace amid the Ukraine conflict and maintaining and developing China-European relations. South China Morning Post
THE UKRAINE UPDATE
US Set to Push Zelensky at Davos for Clearer War Plan. The US is urging Ukraine to sharpen its plan for combating Russia's invasion as the war enters its third year. US National Security Advisor Jake Sullivan is expected to discuss this issue with Ukrainian President Volodymyr Zelensky during their meeting at the World Economic Forum in Davos. The US is reportedly concerned about the delay in finalizing a new strategy and differences between Zelensky and his army chief, Valeriy Zaluzhnyi. Over $110 billion in European and US aid for Ukraine remains held up, and officials in Washington are hopeful it may be released by next month. The US wants to determine how best to support Ukraine in defending itself in 2024 following a 2023 Ukrainian counteroffensive which failed to produce significant results. Bloomberg
Zelensky says Ukraine can stop Russia but needs support. Ukrainian President Volodymyr Zelensky said that Ukraine has demonstrated that it can stop Russia’s military and called for further international support. Speaking during a visit to Lithuania, Zelensky said that he does not feel any pressure from allies to reach a ceasefire or pause fighting against Russia, and vowed to keep Russian President Vladimir Putin from his goal of destroying Ukraine. Zelensky also emphasized the need to bolster Ukraine's air defenses against intensified Russian missile and drone attacks. However, he acknowledged the challenge of stockpiles running low in potential supplier countries. Ukraine has active efforts underway to boost its domestic defense industry and engage in joint production of ammunition and weapons with foreign governments to fill this gap. While in Lithuania, Zelensky signed agreements on cooperation in joint arms production, with similar deals expected in other Baltic countries. Lithuania pledged to send additional ammunition, generators, and armored personnel carriers to Ukraine. Zelensky's trip to the Blatics is focused on security concerns, Ukraine’s aspirations to join the EU and NATO, and building partnerships for drone production and electronic warfare capacities. The Baltic nations, staunch supporters of Ukraine, have expressed concerns about being potential next targets of Russian aggression. Associated Press Bloomberg
Ukraine builds barricades, digs trenches as focus shifts to defense. Reuters reports that Ukraine is shifting to more of a defensive posture, and intensifying the construction of defensive fortifications in the face of increased pressure from the Russian military in the east. The defenses aim to help Ukraine withstand attacks while it focuses on conscription reforms and addressing artillery shortages. Russia has been escalating its offensive around eastern towns like Kupiansk, Lyman, and Avdiivka, making it more challenging for Ukraine to mount an offensive. Fortifications will slow down Russian troops and free up Ukrainian forces for training and potential future offensives. Stronger defenses also serve to protect Ukraine's flanks. The scale and intensity of the construction are not publicly available. Reuters
Russian missile strike hits Kharkiv hotel. A Russian missile strike hit a hotel in the northeastern Ukrainian city of Kharkiv on Wednesday, injuring at least 11 people. Kharkiv Governor Oleh Synehubov said Russia used S-300 missiles in the attack. Officials say there were over 30 civilians in the hotel. A Turkish journalist was reportedly injured in the strike. Russia has launched airstrikes on Kharkiv for the last four days in a row. BBC Kyiv Independent
Massive fires break out in Moscow region. Two large fires occurred in Russia's Moscow Oblast on the night of January 10-11. The first fire took place at a polymer production facility in Obukhovo village, covering an area of 8,000 square meters. The second fire occurred at a one-story administrative and industrial building in Moscow, covering an area of 2,000 square meters. Both fires were extinguished without casualties, and the cause of the fires was not disclosed by authorities. The Obukhovo facility reportedly manufactured materials for various goods, including helmets, body armor, and special footwear. Kyiv Independent
Russia to start producing new glide bomb. Russia is set to begin production of its new glide bomb, the Drel, this year, according to Russian state news agency TASS. Rostec, the state defense conglomerate, confirmed that the product has successfully undergone all required tests, and production of the first batch is scheduled for 2024. The Drel bomb is equipped with the ability to fly independently and follows a gliding flight path to reach its target, opening above it at the appropriate moment. The Drel bomb is designed to destroy armored vehicles, radar stations, power plant control centers, and anti-aircraft missile systems. The bomb is reportedly resistant to jamming and radar detection and could be a cheaper, more massive alternative to cruise and ballistic missiles. There are also concerns that the Drel is a type of cluster bomb, which release numerous smaller bomblets over a wide area. Kyiv Independent Reuters
White House signals support for seizure of frozen Russian assets. The Biden administration is supporting legislation that would allow the seizure of some $300 billion in frozen Russian assets to aid in the reconstruction of Ukraine. The administration said “in principle” it backs the bill, named the Rebuilding Economic Prosperity and Opportunity for Ukrainians Act, that would allow the executive branch to confiscate the funds, according to a memo from the National Security Council to the Senate Foreign Relations Committee. The move comes as the White House seeks support in Congress for additional funding for Ukraine, with Republicans blocking over $60 billion in proposed aid. However, while the move would provide the needed aid and help make Russia pay for damages from the Ukraine war, administration officials have expressed concern that it could also damage the reputation of the U.S. financial system and prompt a flight from the dollar. In consideration of these concerns about global response, officials are considering adding a requirement for the Group of Seven to approve any confiscation of funds. A National Security Council memo said such a requirement would make it more likely for Europe to support any use of the authority and reduce the risk that Russian asset seizures would undermine confidence in the U.S. being a destination for foreign investment. Separately, the bill also includes language that would block Russia from challenging seizure of assets in U.S. courts, which could face constitutional challenges. Bloomberg
NATO reaffirms Ukraine aid for 2024. NATO members have reaffirmed their commitment to supporting Ukraine with military, economic, and humanitarian aid. The NATO-Ukraine Council met on Wednesday and outlined several allies’ plans to offer billions of euros in support for Ukraine. NATO Secretary General Jens Stoltenberg emphasized the need to bolster Ukrainian air defenses and continue to back Ukraine against Russia’s invasion. Ukrainian Air Force Commander Mykola Oleshchuk, who participated in the meeting via video link, emphasized the importance of pilot training and the provision of F-16 fighter jets. Kyiv Independent
E.U. partially agrees on new Ukraine aid tool. EU ambassadors have approved a "partial negotiating mandate" for the proposed Ukraine Facility, a new instrument for supporting Ukraine's recovery and reforms. The move aims to pool €50 billion ($55 billion) from the EU's long-term funding to ensure support for 2024-2027. The three pillars of the Ukraine Facility include the Ukraine Plan, where Kyiv presents recovery plans and reform plans for E.U. integration; E.U. pledges of financial aid through budgetary guarantees, grants, and loans; and E.U. technical support for reforms and alignment with EU legislation. The approved mandate maintains these pillars, with the size of funds, grants, and loans dependent on a mid-term revision of the EU budget (2021-2027). The EU Council's position sets the stage for the European Parliament to consider the mandate. The funding will be crucial for Ukraine's recovery from the impact of Russia's war, with an estimated reconstruction need of €384 billion ($411 billion) over the next 10 years and €142 billion ($152 billion) for 2023-2027. The approval of the partial negotiating mandate follows Hungary's obstruction of E.U. aid. Kyiv Independent
Economy Minister says Ukraine to launch 5 joint ventures with Western arms companies in 2024. Ukraine plans to establish five joint ventures with Western arms manufacturers in 2024, with Ukrainian Defense Industry (Ukroboronprom) being a top priority for cooperation, according to Economy Minister and Deputy Prime Minister Yuliia Svyrydenko. The specific ventures were not named. However, President Volodymyr Zelensky announced agreements for joint defense production with Lithuanian companies, Defense Minister Rustem Umerov indicated plans for joint drone projects with Latvia, and German arms manufacturer Rheinmetall's CEO, Armin Papperger, mentioned plans to build armored vehicles in Ukraine from summer 2024. Prime Minister Denys Shmyhal had previously announced a collaboration between Rheinmetall and Ukroboronprom to repair and maintain Western-produced military vehicles and eventually produce them domestically in Ukraine. The joint enterprise was registered in October 2023. Kyiv Independent
Italy’s Meloni urges Hungary to support Ukraine. Italian Prime Minister Giorgia Meloni is reportedly urging Hungarian Prime Minister Viktor Orban to lift his opposition to a €50 billion E.U. financial aid package for Ukraine and Kyiv’s E.U. membership aspirations. Sources say Meloni’s negotiations could potentially lead Orban's Fidesz party to join the European Conservatives and Reformists (ECR) political party, a pan-European coalition of far-right political parties. Members of the ECR include Meloni's Brothers of Italy, Poland's Law and Justice, and the Sweden Democrats, among others. The ECR's influence in Brussels would increase with Fidesz's addition, positioning the party to contend for the third-largest position in the European Parliament after the upcoming June elections. Despite these potential developments, the ECR would still be far from forming a majority coalition, with the current coalition of the EPP, Socialists, and Renew parties holding a comfortable lead. Meloni's diplomatic efforts reflect her ambitions to establish a role as a power broker in E.U. foreign policy. Bloomberg Financial Times Kyiv Independent
Slovak PM decries Western strategy on Ukraine, says Russia 'also needs security guarantees'. Slovak Prime Minister Robert Fico criticized the West's approach to the Russia-Ukraine war in a Pravda newspaper column published on Tuesday. Fico asserted that Western strategy to support Ukraine has failed to collapse Russia’s economy and prevent Moscow from maintaining control of parts of Ukrainian territory. He also criticized Western military aid, claiming that Ukraine is “incapable of a meaningful counteroffensive” and has become dependent on Western financial assistance. Additionally, while acknowledging Russia's invasion violated international law, Fico rejected a "black-and-white perspective," citing Russia’s occupation of Donetsk and Luhansk in 2014 over Ukraine’s alleged discrimination its Russian-speaking population. Fico also called for stabilization of E.U.-Russia relations, noting that Moscow needs “security guarantees.” Fico was elected on a Ukraine-skeptic platform and has halted Slovak arms supplies to Ukraine. Fico is also close to Hungary's Prime Minister Viktor Orban, who has maintained close ties with Russia. Despite indirectly attacking a €50 billion euro E.U. aid package for Ukraine, Fico did not oppose it in December. He also has not opposed Ukraine’s E.U. membership if criteria is met. Due to this, experts say Fico’s fiery rhetoric will not lead to direct opposition to Ukraine support, with Hungary remaining the main opposition. Kyiv Independent
ANALYSIS — European cracks appear in support for Ukraine. As further U.S. aid for Ukraine remains uncertain, Kyiv is turning to Europe to fill the gap, but it is finding varying levels of support. The Baltic states, which are former Soviet states that declared independence to escape Russian influence, have shown unwavering support for Ukraine. Ukrainian President Volodymyr Zelensky’s tour of the Baltics aims to rally this political backing, especially as other European nations experience growing fatigue and financial distress from the conflict. In contrast, Hungary’s Prime Minister Viktor Orban has blocked new E.U. aid for Ukraine. With these divisions, there are concerns about Europe sustaining the level of military and economic aid that Ukraine needs. Kyiv has stressed that a Ukrainian defeat will embolden Russian aggression against other European countries. New York Times
South Korea says Ukraine is 'test site' for North Korean missiles. The United States and its allies have condemned Russia's alleged firing of North Korean missiles at Ukraine. Washington called it abhorrent, while South Korea described Ukraine as a test site for Pyongyang's nuclear-capable missiles. Russia's envoy to the UN accused the U.S. of spreading “wrong” information, but stopped short of an outright denial, leading to accusations that Russia was exploiting its position as a veto-holding permanent member of the UN Security Council. The White House recently cited declassified intelligence that Russia used short-range ballistic missiles from North Korea in multiple strikes against Ukraine, which if true, would be a violation of UN Security Council resolutions which prevent North Korean arms transfers abroad. Reuters Kyiv Independent
Ukraine adds sandwich chain Subway to list of ‘War Sponsors’. Ukraine's anti-corruption watchdog, the Ukrainian National Agency on Corruption Prevention (NACP), has added Subway to its list of "war sponsors" for doing business in Russia. The NACP claims that Subway's more than 500 restaurants in Russia contribute to the Russian economy amid the ongoing conflict with Ukraine. Subway is accused of promoting its activities through sanctioned Russian social networks and using Yandex, a Russian search engine, for deliveries. The NACP notes that Subway has not reduced its operations in Russia since the invasion began in 2022. Subway has not commented on its inclusion in the NACP's list. Bloomberg
Special Report — How Russia, collaborators spirit away Ukraine’s children. Reuters has conducted a six-month investigation into the fate of missing Ukrainian children, focusing on orphans and those separated from their families. Many of these children have had their stories hidden from the public. The International Criminal Court (ICC) prosecutor's office is actively investigating the abduction of Ukrainian children but cannot provide details due to the need for confidentiality. Ukrainian prosecutors are also conducting investigations into the illegal transfer and deportation of Ukrainian children to occupied territories and their adoption by Russian families. Reuters
Belarus sends children from occupied Ukraine to train with Belarusian military. Belarus state television reported that Ukrainian children from occupied territories are being sent to train with the Belarusian military for emergency evacuation drills and how to behave in “extreme situations”. The report says that 35 children from the Russian-occupied town of Antratsyt were sent to the eastern Belarusian city of Mogilev. Over 2,400 Ukrainian children aged 6 to 17 have reportedly been brought to Belarus from four Ukrainian regions partially occupied by Russia, according to a Yale University study. Ukraine and Belarusian opposition claim this is an illegal mass transfer of children to Belarus, allegedly for pro-Russian indoctrination. Belarusian opposition has called on the International Criminal Court (ICC) to hold Belarusian President Alexander Lukashenko accountable for the forced transfers. Ukrainian authorities are investigating the deportations as possible genocide. The ICC previously issued arrest warrants for Russian President Vladimir Putin and an official for their alleged role in forced transfers of children from occupied Ukraine. Belarus, a close ally of Russia since the 2022 invasion of Ukraine, has allowed Moscow to use its territory for military actions. Associated Press RFE/RL Euronews
Russia bans entry to Moldovan officials, journalists. The Russian Foreign Ministry has banned Moldovan government and media officials from entering Russia, accusing them of persecuting Russian media and discriminating against Russian citizens. This follows a previous ban on 11 Moldovan officials after Moldova restricted access to certain Russian media sites it said spread disinformation ahead of local elections. The new ban includes high-ranking members of the president's office and journalists from Moldovan outlets. The Russian Foreign Ministry also summoned Moldova’s ambassador on Wednesday to convey that the “unfriendly actions of official Chisinau” led to the ban. Moldova has worked to distance itself from Moscow by increasing its military budget, participating in joint NATO exercises, and pursuing E.U. membership. Moldova has said Moscow’s attempts to get Moldovans to obtain Russian citizenship is an attempt to recruit them for the Ukraine war. Analysts have added that Russian state-run media is sowing political instability in Moldova, namely by appealing to pro-Russian separatists in the breakaway region of Transnistria. Kyiv Independent Reuters
Black Sea nations agree to mine-hunting coalition. Turkey, Romania, and Bulgaria are collaborating to remove mines in the Black Sea to improve shipping safety in the region and secure Ukrainian grain exports. The initiative, led by Istanbul aims to neutralize mines in specific Black Sea areas placed during the Ukraine war. The joint action, marked by a memorandum of understanding signed in Istanbul, is the first major collaboration among Black Sea nations since Russia's invasion in 2022. Despite coalition members being NATO allies, the operation is not officially considered a NATO mission. The coalition excludes other NATO members, such as the US and UK, to prevent escalating tensions in the Black Sea. Turkey has also refused passage to mine-hunting ships donated by Britain to Ukraine as part of efforts to ensure the involvement of only Black Sea nations. Turkey had previously brokered a UN-backed agreement for free passage of Ukrainian grain, but Russia abandoned the deal in 2023. Bloomberg
ELSEWHERE IN THE WORLD
The Americas
Investors form alliance to bolster AUKUS military partnership. Over 400 investors are forming the AUKUS Defense Investor Network (DIN) to enhance collaboration in the private sectors of the U.S., U.K., and Australia, beyond the military cooperation outlined in the trilateral AUKUS pact. Led by innovation advisory firm BMNT, the DIN, representing about $265 billion in venture capital, aims to increase funding for national security innovation. The network plans to host its inaugural meeting in February, providing a platform for investors to discuss challenges, understand technology needs in national security, and engage with defense officials from the three countries. While primarily composed of U.S. firms, the DIN includes members from Australia and the U.K. The U.S. defense industrial base and venture capital community notably dominate, drawing over $100 billion in private capital for defense technology startups between 2021 and 2023. The DIN's formation aligns with the broader focus of AUKUS on advanced military technologies, including quantum, AI, undersea capabilities, hypersonics, and electronic warfare. The network aims to facilitate financing, industry connectivity, and discussions between private investors and the military to drive venture funding toward technologies meeting military needs. It also plans to coordinate meetings with industry forums hosted by the three countries, fostering trust and collaboration in leveraging private capital for defense innovation. Defense News
Navy accepting Landing Ship Medium proposals for FY25 contract award. The U.S. Navy is actively seeking proposals for its Landing Ship Medium (LSM) program, a top priority for the Navy-Marine amphibious team. The Navy intends to procure the vessels in 2025 and aims for delivery by 2029. The request for proposals, released on January 5, covers up to six vessels, with proposals due by May 9. The LSM is crucial for supporting Marine littoral regiments, designed as a stand-in force with the capability to spend extended periods in key locations such as the Philippines or Japan. Unlike traditional rotational deployments, these regiments require surface vessels to move between islands and beachheads. The LSM, formerly known as the Light Amphibious Warship, faced delays, with the program's contract award pushed to fiscal year 2025 due to budget constraints. To utilize the intervening time, the Marine Corps is acquiring three stern landing vessels to serve as LSM prototypes for experimentation. The program, despite initial setbacks, is progressing positively within a resource-constrained environment. The LSM is expected to have a range of 3,000-5,000 nautical miles to facilitate operations in the vast Pacific. Defense News
Ecuador gets U.S. aid pledge in fight against drug gangs. Ecuador's President Daniel Noboa said he has received a pledge of aid from the U.S. to address escalating violence by drug traffickers in his country. The violence erupted due to a crackdown on drug trafficking, leading to conflicts between gangs and the state. President Noboa declared a state of emergency, deploying the army to tackle the cartels, which retaliated by holding prison riots, launching attacks on media outlets, and taking hostages. Despite government efforts, inmates still hold hostages in multiple jails. The situation has prompted closures of schools and remote work for public offices. The US expressed extreme concern over the violence and pledged assistance to the Ecuadorian government. The aid package is expected to arrive within the next few days. Following the announcement of U.S. support to address the crisis, Ecuador's dollar bonds rebounded. Bloomberg Reuters Financial Times Wall Street Journal Associated Press
Guyana seeks US support as territorial dispute with Venezuela deepens. Guyana is seeking assistance from the United States to bolster its defense capabilities due to concerns that neighboring Venezuela may attempt to seize a disputed region in western Guyana rich in minerals and oil. Following talks between Guyanese officials and U.S. Deputy Assistant Secretary of Defense Daniel P. Erikson, it was announced that the U.S. would help enhance Guyana's military in the coming months. The move comes amid ongoing tensions over the century-old dispute regarding Guyana's Essequibo region, where significant oil and gas deposits have been discovered. Associated Press
Asia and Oceania
U.S to send delegation to Taiwan immediately after presidential election. President Joe Biden is planning to send a high-level delegation of former top officials — including James Steinberg, a former Democratic deputy secretary of state, and Stephen Hadley, a former Republican national security advisor — to Taipei after the Taiwan election on Saturday. Laura Rosenberger, chair of the American Institute in Taiwan, will also join the delegation. A senior U.S. official said Washington is sending the delegation to ensure it is “communicating clearly” to Taiwan’s winning and losing presidential candidates about the unofficial relationship between the U.S. and the island. Previous delegations were dispatched by Biden to affirm support for Taiwan, but sending one immediately after an election could escalate tensions. Some experts argue that the timing of the delegation is risky and may backfire, potentially complicating Washington’s efforts to stabilize relations with China. However, others view it as a positive gesture to support Taiwan's democracy. The Chinese embassy in Washington expressed strong opposition to the delegation, urging the Biden administration to refrain from any official contact with Taiwan. Financial Times Associated Press
China warns U.S. against escalating tensions, reversing diplomatic progress. China has recently increased diplomatic outreach to the U.S., emphasizing the “San Francisco vision” in a show of eagerness to improve relations with the U.S. and desire to avoid reversing progress made at the November summit between President Joe Biden and Chinese President Xi Jinping. Chinese diplomats have been using this month’s 45th anniversary of the start of U.S.-China relations as a call for Washington to adhere to this vision. Liu Jianchao, minister of the International Department of the Chinese Communist Party’s Central Committee, said Beijing is committed to this vision of seeking dialogue and cooperation while managing difficulties, particularly regarding Taiwan. Diplomatic engagement based on this vision comes ahead of elections in Taiwan, the results of which could impact Beijing’s interest in sustaining communication channels with the U.S. Wall Street Journal
China says will never compromise on Taiwan, U.S. urges against interference in Taiwan’s elections. China affirmed during its first military talks with the U.S. since 2021 that it will “never compromise” on its stance on Taiwan. China urged the U.S. to "stop arming Taiwan" and “not support Taiwan independence,” emphasizing that Washington must take Beijing’s concerns seriously. China has expressed a willingness to develop stable military relations with the U.S. based on equality and respect but insisted that it would not make any concessions on the Taiwan issue. The military talks came just before crucial elections in Taiwan that could influence the island's relationship with Beijing and impact Sino-U.S. relations. The U.S. warned at the talks that it opposes any outside interference or influence in the Taiwanese elections. BBC Reuters South China Morning Post
Taiwan’s China-friendly opposition rules out unification talks. Taiwan's opposition party, Kuomintang (KMT), ruled out unification talks with China if it wins the upcoming presidential election, emphasizing the difficulties Chinese President Xi Jinping faces in bringing Taiwan under his control. KMT's presidential candidate Hou Yu-ih stated that he would not address the issue of unification during his tenure, seeking to allay concerns among voters about potential compromises on Taiwan's democracy and autonomy. Hou stressed the need for Taiwan to strengthen its defense capabilities before engaging in serious cross-strait negotiations, aligning with mainstream public opinion in Taiwan. A KMT win could provide Beijing with a more willing negotiating partner, as the party supports eventual unification with China. However, the current government, led by President Tsai Ing-wen, has resisted Chinese efforts to isolate Taiwan and has strengthened ties with the US and like-minded partners. Hou warned of the increased risk of invasion, emphasizing the delicate political balancing act that has shifted under Tsai, leaving the island on the brink of war with daily incursions by China. The remarks echo previous warnings from Chinese officials about the choice between "peace and war" in Taiwan's election. Bloomberg
North Korea set to strengthen its missile program. South Korea’s Defense Minister Shin Wonsik told Yonhap news that North Korea is strengthening its missile program by expanding the types of missiles it is providing to Russia, while also looking to test a new type of nuclear-capable missile. Shin says Pyongang is planning for a trial of an atmospheric reentry warhead,, carried by an intercontinental ballistic missile which means North Korea would have long-range rocket capability with a range of “several thousand” kilometers. Bloomberg
China’s commerce minister raises concerns over U.S. chip-making export controls, sanctions. Commerce Secretary Gina Raimondo about U.S. measures restricting China's access to advanced chipmaking technology. The two commerce officials’ discussion focused on U.S. efforts to pressure ASML Holding NV to halt some lithography machine exports to China, namely impacting the export of high-end products that ASML canceled at the request of the U.S. Additionally, Wang raised the issue of the U.S. Department of Commerce surveying American firms to assess their reliance on Chinese-produced chips, with potential tariffs on low-priced chips from China being considered. While the U.S. argues that these measures are aimed at preventing China's military access to advanced technology, Beijing says they are also impacting Chinese businesses seeking the latest technology. This exchange marks the second public communication between Wang and Raimondo since Raimondo's visit to China in August. Reuters Bloomberg
Chinese military-linked research vessels conducting Indian Ocean surveys. Chinese research vessels linked to the People’s Liberation Army (PLA) are conducting extensive surveys of the Indian Ocean's undersea floor, potentially aiding the deployment of submarines in the region. Analysis by the Center for Strategic and International Studies (CSIS) found that the 13 Chinese vessels that took on the bulk of surveys in the Indian Ocean since 2020 were all linked to China’s military and have engaged in suspicious behavior, including docking at military ports and turning off tracking devices. The data from these ships’ surveys could potentially serve military purposes, namely for submarine maneuvering in conflict. There is heightened regional concern about the potential implications of this research activity. Sri Lanka recently imposed a moratorium on Chinese research vessels entering its waters under Indian pressure, expressing fears about surveillance near Indian territory. The U.S. has also expressed concern as it aims to strengthen security ties with India amid China’s expanding Indo-Pacific military influence. Washington Post
U.S. confirms fuel shipment to Philippines. The U.S. embassy in Manila confirmed the delivery of fuel from a naval base in Hawaii to a facility in Subic Bay, a former U.S. base in the Philippines, in coordination with the Philippine government. The shipment raised suspicions about potential military pre-positioning amid concerns over Chinese aggression. An embassy spokesperson emphasized that the delivery was part of multiple shipments of safe, clean fuel from Pearl Harbor to Pacific locations, without specifying the size of the Subic Bay shipment. LSEG shipping data indicated a U.S.-registered oil tanker left Hawaii around December 20, carrying clean fuel to the Philippines. Senator Imee Marcos questioned the storage of millions of gallons of oil in Subic, a location not covered by the Enhanced Defense Cooperation Agreement (EDCA) between the U.S. and the Philippines, which grants U.S. access to certain military bases. President Ferdinand Marcos Jr. expanded U.S. access to military bases last year amid rising tensions in the South China Sea and over Taiwan. The Philippines' Department of National Defense stated that the shipment is part of regular commercial transactions between the U.S. government and Philippine companies. Reuters
Germany expresses concern over South China Sea tensions. Germany's Foreign Minister Annalena Baerbock expressed concern over rising tensions in the South China Sea between China and the Philippines, citing incidents where the Chinese coast guard used lasers and water cannons against Philippine vessels. China has claimed extensive territories in the South China Sea, including areas contested by neighboring countries. Baerbock emphasized that such claims are not covered by international law, referencing a 2016 international tribunal ruling. In response, China warned against interference, stating that differences with Southeast Asian countries should be resolved through direct dialogue. Baerbock also highlighted the strategic significance of Southeast Asia and announced Germany's deployment of reconnaissance drones in the Indo-Pacific region. Bloomberg
Maldives president meets China’s Xi, upgrades ties amid tensions with India. Maldives President Mohamed Muizzu met with Chinese President Xi Jinping in Beijing on Wednesday. During his visit, China and the Maldives upgraded relations to a “comprehensive strategic cooperative partnership,” which could pave the way for increased Chinese investment in the Indian Ocean. Xi called Muizzu an “old friend” and emphasized the historic opportunity for bilateral ties between their countries to progress. Muizzu also called for more Chinese investment in the Maldives, calling Beijing the country’s “closest partner in development.” Muizzu ran on a campaign framing the Maldives’ traditional partner India as a threat to the island nation’s sovereignty, calling for Indian military personnel to leave the country and for stronger ties with China. His visit to Beijing came amid a diplomatic row with India over disparaging remarks made by Maldivian ministers about Indian Prime Minister Narendra Modi, which has prompted calls in India to boycott Maldivian tourism. Muizzu has said he seeks to diversify the Maldives’ tourism industry with more Chinese travelers. Critics of this pivot to Beijing have raised concerns about the Maldives’ heavy indebtedness to China and the impact of strained economic relations with India. Nikkei Asia
Papua New Guinea orders military to restore order as unrest rocks capital. The government of Papua New Guinea has deployed the military to restore order in the capital, Port Moresby, following protests and unrest sparked by a dispute over the wages of police officers and public servants. Angry demonstrators, including government employees, gathered outside Parliament, and the situation quickly deteriorated. Over a dozen shops were set on fire and there are reports of widespread looting. Shots were fired near the US Embassy, prompting shelter-in-place advice for its employees, and protesters also damaged the entrance to the building housing the prime minister's office. Prime Minister James Marape explained that a computer glitch led to a $100 deduction from public servants' paychecks and that the payroll error will be corrected in the next paycheck. He also denied claims from protesters that the government is passing a tax increase. The unrest is set to continue due to ongoing wider economic challenges, including high youth unemployment and soaring inflation costs. Papua New Guinea, with significant resources, is navigating delicate political dynamics as the US and China vie for influence in the South Pacific. China condemned the riots, saying that the violence had caused damage to Chinese-owned stores and injured Chinese nationals. New York Times Reuters Associated Press BBC The Guardian
ASEAN special envoy meets Myanmar junta chief. Myanmar's junta chief, Min Aung Hlaing, held talks with Alounkeo Kittikhoun, the special envoy from the Association of Southeast Asian Nations (ASEAN), as Laos assumes the chair of the bloc. While Laos has not officially commented on the envoy's trip, talks reportedly focused on efforts for peace and national reconciliation. Myanmar has experienced ongoing violence since the 2021 coup, and ASEAN has consistently urged the junta to cease hostilities and adhere to its "five-point consensus." The junta, however, has refused dialogue with opposition groups, labeling them as "terrorists." Min Aung Hlaing stated that his administration is implementing the ASEAN five-point consensus, adjusted with the State Administration Council's roadmap. However, the junta's own five-point roadmap, announced after seizing power, differs significantly from the ASEAN plan, focusing more on pandemic recovery and organizing a new election under its terms. Critics argue that the special envoy should engage with all stakeholders, including the National Unity Government and ethnic armed groups, given the junta's lack of willingness to implement the consensus. Reuters Nikkei Asia Associated Press
Europe
Fake News & Tech Risks top global concerns at Davos 2024. The World Economic Forum's annual risk survey reveals shifting concerns among policymakers and experts, with technology-related risks and disinformation now topping the list, overtaking economic worries. The survey, based on input from over 1,400 experts and leaders, anticipates a moderately risky global environment until 2026, followed by a significant deterioration in risks. Half of the top 10 global risks projected until 2034 are related to climate change and environmental degradation. Geopolitical tensions and large-scale armed conflicts also feature prominently in perceived risks. The survey points to the destabilizing effects of polarizing narratives and insecurity in an evolving global order. Bloomberg Wall Street Journal
Chinese, Finnish presidents discuss Baltic gas pipeline damage. Chinese President Xi Jinping and Finnish President Sauli Niinisto held "constructive" virtual talks on the Balticconnector pipeline, a damaged gas pipeline between Finland and Estonia. Finnish police have said the Hong Kong-flagged NewNew Polar Bear container ship is suspected of damaging the pipeline and two undersea Baltic telecoms cables with its anchor. It remains uncertain if the damage was accidental or deliberate. Beijing has pledged full cooperation with the investigation into the incident. Besides the pipeline, Xi and Niinisto also discussed the Ukraine war, E.U.-China relations, and other global issues. Xi praised Finland during the talks for its “"long-standing friendly policy towards China" and emphasized stable and positive trends in bilateral relations, highlighting cooperation in various sectors. Xi also expressed China's willingness to deepen mutually beneficial cooperation, advocate multilateralism, safeguard free trade, and contribute to global peace and stability. The talks came amid growing tensions between China and Europe as China also seeks closer bilateral ties with individual EU members. South China Morning Post
Finland continues Russia border crossing closures. Finland is extending closures of border crossing points with Russia, which were set to end on January 15, according to Finnish newspaper Iltalehti citing unnamed government sources. The Finnish interior ministry did not immediately comment on the report or confirm changes to border policy. Finland closed its border with Russia late last year after a surge of asylum seekers entered from Russia. Finland has accused Russia of orchestrating the inflow of people to create an artificial migrant crisis, which Moscow has denied. Reuters
Germany approves air-to-air missile sale to Saudi Arabia. Germany has approved the sale of 150 IRIS-T air-to-air missiles to Saudi Arabia, marking the first weapons shipment to the Gulf nation granted by the German government in over five years. The approval comes after Germany halted weapons deliveries to Saudi Arabia in late 2018 due to its involvement in the conflict in Yemen and the murder of journalist Jamal Khashoggi. The decision to resume arms sales is seen as a reward for Saudi Arabia's recent support for Israel. Chancellor Olaf Scholz's administration also indicated its willingness to support the sale of additional Eurofighter aircraft to Saudi Arabia, with potential delivery expected in several years. The IRIS-T missiles are produced through a joint project involving companies from Germany, Greece, Norway, Italy, Spain, and Sweden, with Diehl Defence GmbH & Co. KG in Germany serving as the main contractor. Bloomberg
Germany on alert after far-right extremist ‘re-migration’ plot uncovered. Germany's interior minister has warned of the increasing threat from extremists after reports revealed a meeting attended by members of the far-right AfD party discussing a "re-migration" concept reminiscent of Nazi policies. The gathering, which included a close aide of AfD Co-leader Alice Weidel and two members of the Christian Democrats, took place in November near Potsdam. Discussions involved a proposal for mass deportations of asylum seekers, foreigners with the right to reside in Germany, and non-"assimilated" German citizens. The AfD and CDU said they are monitoring the situation with concern, with the CDU emphasizing that anyone involved in such activities violates the party's principles. Germany's interior minister highlighted the danger of right-wing extremism, emphasizing the need for close monitoring and stating that Germany will not tolerate extremists undermining democracy and human dignity. Bloomberg
Belgium investigating alleged Chinese spy. Belgium has initiated a criminal investigation into Flemish far-right politician Frank Creyelman, who allegedly served as a Chinese intelligence asset for more than three years. Creyelman, a former member of the far-right Vlaams Belang party, was allegedly directed by a Chinese intelligence officer to influence discussions in Europe on various issues. The case, involving espionage and foreign interference, has been handed over to the federal prosecutor. Although these activities are not criminal offenses under Belgium's penal code, authorities often prosecute similar cases on corruption charges. The investigation comes amid growing concerns about foreign interference and comes ahead of a vote in Belgium on reforms to its penal code. Creyelman has not responded to the allegations, and Chinese authorities deny knowledge of the case. Financial Times
Middle East
Iran seizes tanker off Oman. A tanker previously seized by the US for transporting illicit Iranian oil, the St Nikolas, was captured by Iran off the coast of Oman, heightening tensions in the crucial global crude supply trade lane. Iran seized the vessel "in retaliation for the theft of oil by the US," according to Iranian sources. The tanker had loaded around a million barrels of crude at the Iraqi port of Basrah for Turkish oil company Tupras and was en route to Turkey via the Suez Canal. The incident adds to the shipping turmoil in the Middle East caused by recent attacks on ships in the Red Sea by Iran-backed Houthi militants. The US and its allies are considering options for retaliation. The tanker's owner, Empire Navigation, admitted last year to violating sanctions on Iran, leading to the seizure of its oil cargo in the US. The hijacking occurred shortly after the US and UK intercepted drones and missiles following a significant Houthi attack in the Red Sea. Oil prices rose in response to the heightened tensions. Bloomberg
U.S. condemns Houthi attacks in Red Sea, U.K. signals response. Secretary of State Antony Blinken has attributed the surge in Houthi attacks on commercial shipping in the Red Sea to Iran's support. He stated that these attacks, involving hundreds of incidents affecting ships from 40 countries since November, are facilitated by Iran through technology, equipment, and intelligence information. Blinken highlighted the impact on the global economy, with thousands of ships diverting, taking longer routes, and incurring higher costs, leading to increased prices for fuel, medicine, and food. However, Blinken declined to discuss potential U.S. military action against Houthi targets in Yemen in response. UK defense secretary Grant Shappes hinted at potentially imminent military retaliation against the Houthis, saying that the UK is in regular contact with Saudi Arabia and other regional partners who all “agreed” that Houthi attacks “cannot continue.” Their comments came after U.S. and British naval forces intercepted 21 drones and missiles launched by Houthi forces in the Red Sea on Tuesday, repelling the largest attack to date. The U.N. Security Council demanded on Wednesday that the Houthis cease their attacks on Red Sea commercial shipping. A Houthi spokesman has since said its attacks do not threaten peace talks with Saudi Arabia and blamed Israel’s war in Gaza for escalating regional tensions. Washington Post Wall Street Journal Bloomberg Financial Times Reuters Al Jazeera
White House official to visit Beirut, seeking to ease Israel-Lebanon tensions. Senior White House adviser Amos Hochstein is set to visit Beirut to help ease tensions along the Israel-Lebanon border. Concerns in Washington include the potential spread of violence across the region due to Israel's conflict in Gaza. Hezbollah and the Israeli military have been exchanging fire along the border since the Hamas attacks against Israel on October 7. Lebanon's caretaker Prime Minister Najib Mikati expressed readiness for talks on long-term stability on the Israel-Lebanon border. Hochstein, the U.S. energy envoy, previously mentioned the possibility of talks on drawing the land border between Israel and Lebanon. Israel has emphasized diplomatic efforts to prevent Hezbollah attacks but warned of military action if necessary. Reuters Al Jazeera
Africa
Somali militants take hostages, kill one after U.N. helicopter makes forced landing. A United Nations helicopter made a forced landing in a militant-controlled area of Somalia, resulting in several people being captured and at least one killed. The helicopter, belonging to the UN Support Office for Somalia, experienced mechanical issues. Al-Shabaab, an active al Qaeda affiliate, reportedly surrounded the downed aircraft. Among the nine individuals on board were two Kenyan medics, a Ugandan soldier, a Somali officer, and an Egyptian doctor who was killed by militants. The situation is described by some officials as a hostage-taking, prompting a response from Somali government forces. The UN has established an emergency task force to address the crisis. Wall Street Journal Wall Street Journal New York Times Reuters Washington Post Associated Press Bloomberg
THE CYBER AND TECH RUNDOWN
FBI, NSA Directors Warn of Mounting Foreign Threat to U.S. Elections. FBI Director Christopher Wray and Gen. Paul Nakasone, the leader of U.S. Cyber Command and the National Security Agency (NSA), warned Tuesday of expanding foreign influence operations targeting the 2024 U.S. elections. Speaking at an international cybersecurity conference in New York, Wray and Nakasone noted that more countries than ever will be involved in disinformation campaigns with ever-evolving techniques. Wray said, “in that sense, every election cycle presents bigger challenges.” At the same time, the U.S. has reinforced its defenses against influence and interference operations, centered on partnerships employing Federal, state, local, and private sector resources. Wray pointed out that “all those partnerships are exponentially more sophisticated and effective than they were in each prior election cycle.” Nakasone said that the fact America’s adversaries are using U.S.-made AI models in their campaigns underscores the need to defend those tools from foreign exploitation. Following up on those remarks, Wray observed, “from a scale perspective, the most sweeping and broad threat to our innovation, our intellectual property, and in the long run our economic and national security, is the People's Republic of China.” The Record Cybernews
Justice officials outline ‘increased tempo’ actions against cybercrime in 2024. A senior Justice Department cyber official said Tuesday that he expects “a more increased tempo” in U.S. efforts to disrupt cybersecurity threats in the coming year. Sean Newell, chief of Justice’s nation security cyber section, said that many law enforcement actions are public, but many are not, and that the pace of activity will continue in 2024. Newell’s remarks came at an international cybersecurity conference in New York at which FBI Director Christopher Wray, NSA Director Paul Nakasone, and other officials spoke. U.S. attorneys for the Eastern and Southern Districts of New York talked about the cyber-related priorities for their offices, respectively. Breaon Peace said the Eastern District would concentrate on dismantling cybercriminal infrastructure as part of building cases against cybercriminals. While arrests of threat actors are vital, Peace said targeting individuals and companies that provide services and infrastructure to criminals is equally important. He added, “cyber criminals do not operate in a vacuum. They depend on an ecosystem that allows them to thrive.” For the Southern District, Williams noted that prosecutions would prioritize cryptocurrency hacking activity as well as crypto scams and fraudulent coins. The Record
SEC ‘X’ account hack reporting fake bitcoin decision renews concern over platform security. A hack of the “X” (formerly Twitter) account of the Securities and Exchange Commission (SEC) on Tuesday that resulted in the posting of false news concerning bitcoin has spotlighted concerns about the social media platform’s security defenses. The posting, which the SEC removed about 30 minutes after it appeared, took advantage of a highly anticipated SEC decision on whether exchange-traded funds can hold bitcoin. X has confirmed that the SEC account was hacked when an unidentified actor gained control over a phone number linked to the account. Two-factor authentication was not enabled at the time of the breach. Austin Berglas, a cybersecurity executive and former FBI cyber official, noted the damaging potential of a hack that could "affect the value of bitcoin in the market - there's massive opportunity for disinformation." An SEC spokesperson said the commission is investigating the hack in cooperation with law enforcement and other government agencies. (Ed. Note- A day later the SEC confirmed the approval of crypto ETF investments) Reuters Bloomberg Wall Street Journal CyberScoop
China’s space ambitions include rival to Starlink constellation for commercial, military use. China’s plan to create a rival satellite network to SpaceX’s Starlink is taking its first steps with the construction of a spacecraft launch site near the Wenchang large rocket spaceport in Hainan province. Ultimately, the Chinese constellation will have 26,000 satellites, beginning with the launch of 1,300 satellites from 2024 through 2029. The government-owned China Satellite Network Group (CSNG) is managing the initiative to create a high-speed Internet network that by 2035 will support high-speed 6G communications. CSNG leaders have close ties to China’s military-industrial sector, with the chairman coming from the China Electronics Corp. and the president from the China Aerospace Science and Technology Corp. Other Chinese space plans include the 2025 launch into low-earth-orbit of 600 satellites by a space company partly owned by the Shanghai government, out of an eventual constellation of 12,000 satellites. The military-industrial firms CASC and China Aerospace Science and Industry Corp. are proceeding with launch plans for more than 300 and 200 low-orbit satellites, respectively. Nikkei Asia
Huawei Ends US Lobbying Operations After Years of Fighting Ban. Huawei, the Chinese telecom equipment maker, has closed its in-house lobbying operations in Washington, marking the end of its expensive and years-long effort to maintain a presence in the North American market. The company, which was blacklisted in the US, had previously spent tens of millions of dollars on lobbying. Rising tensions with Beijing and national security concerns led to Huawei's virtual exclusion from the US market. This move is a reflection of the company's limited prospects in the US. Bloomberg
Concern growing over Chinese exploiting RISC-V standard to evade export controls. The next front in the chip competition between the U.S. and China may center on a technology called RISC-V, an open-source assembly language used in designing processors for smartphones, wi-fi routers, and high-performance devices. As a foundation for chips performing computing tasks, RISC-V usage extends well beyond consumer goods to encryption and military applications. A debate is now brewing on Capitol Hill on possible restrictions on the standard, which is available on the Internet for free. In December, the House Select Committee on the Chinese Communist Party called for an interagency examination of RISC-V. One congressman said the Chinese government is “already attempting to use RISC-V’s design architecture to undermine our export controls.” Some officials in the Biden administration have similar concerns about RISC-V, but are uncertain of how to regulate the technology. The Commerce Department and the National Security Council have declined comment. Trying to reverse the exceptions to U.S. export controls granted to open-source technologies, like RISC-V, “is certainly going to raise thorny legal issues and important public policy concerns,” according to Daniel Pickard, a trade and national security lawyer. The New York Times reports that over 100 “significant” Chinese companies currently design chips with RISC-V, with many applications in routine consumer products. Experts believe, however, that the technology could take over more demanding tasks. For example, Chinese aerospace scientists have proposed using RISC-V to develop high-performance spaceborne computers and other Chinese organizations plan to link together RISC-V processors for large-scale tasks in data centers, including AI applications. New York Times
Chinese firms resort to repurposed gaming chips in face of U.S. export controls. Chips repurposed from gaming products are being used by Chinese companies to develop AI tools, the Financial Times reports. According to sources, Nvidia graphics cards are being stripped of core components in the thousands to be installed on new circuit boards. These workaround efforts, industry experts say, are prompted by the absence of high-end processors in China. One factory manager said more than 4,000 Nvidia gaming cards were disassembled in December, four times more than in November. Charlie Chai, a research analyst, described the gaming chip transfers as “a desperate move by Chinese companies under the export controls. Just like using a kitchen knife to create artwork, it’s doable, but the effect is suboptimal.” Public enterprises and small AI facilities that had not previously stockpiled Nvidia products reportedly are the primary customers for the repurposed chips. Modifications to Nvidia products violate the company’s intellectual property rights, and certain gaming cards could be banned from being sold to China. Repurposing has been widespread of Nvidia’s most powerful gaming graphics board, the GeForce RTX 4090, but it is now blocked for export to China. In compliance with the latest U.S. export controls, Nvidia last month introduced the GeForce RTX 4090 D, 5 per cent slower than versions sold outside China. Differences in performance between the two GeForce models, one factory manager said, would be “more significant,” with the slower version possibly unusable for language model training. Financial Times
Microsoft debates continuing Beijing research laboratory. Microsoft executives reportedly have been involved over the past year in an internal debate over what to do with the company’s advanced research laboratory in China, which opened in 1998. The lab, which employs hundreds of researchers, has spearheaded Microsoft’s work in speech, image, and facial recognition and the AI techniques underlying later applications like the ChatGPT chatbot. Now, as competitive tensions remain high between the U.S. and China, Microsoft executives are discussing the viability of maintaining an advanced technology facility in Beijing. As the conversation has continued, Microsoft has instituted “guardrails” at the lab to restrict researchers from sensitive work. The company also has announced plans to move some researchers from China to a facility in Vancouver, British Columbia, although Microsoft leadership reportedly support a continued research presence in China. Peter Lee, the head of Microsoft Research, which links eight labs worldwide, said “there has been no discussion or advocacy to close Microsoft Research Asia, and we look forward to continuing our research agenda.” Sources familiar with the discussion within Microsoft say that concerns center over the hypothetical risk that China could hack or otherwise infiltrate the lab, or that its researchers could leave to join Chinese companies affiliated with the government. New York Times
Ivanti customers urged to patch vulnerabilities allegedly exploited by Chinese state hackers. The Cybersecurity and Infrastructure Security Agency (CISA) has issued a warning urging users of Ivanti's Connect Secure VPN tool to patch two actively exploited vulnerabilities. The vulnerabilities, tracked as CVE-2023-46805 and CVE-2024-21887, have severity scores of 8.2 and 9.1, respectively. They allow attackers to bypass control checks and send commands to a device. Ivanti reported that hackers are actively exploiting these vulnerabilities together. Cybersecurity firm Volexity was credited for identifying and reporting the issue. The firm said Chinese state hackers may have been exploiting the vulnerability. Ivanti is in the process of developing patches, and customers are advised to take immediate action to ensure protection. The Record
The data cutoff for this product was 7:00 a.m. E.T.
Brad Christian, Ethan Masucol, Bruce Wilmot, Ken Hughes, Katharine Campbell, Leighton Durham, and Ryan Simons contributed to this report.
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