This will be a year [2025] of living with danger
The Australian
By Peter Jennings*
11 January 2025
Much in 2025 depends on the character of the Trump administration. One thing is a certainty: this will be a year of living with danger.
If you thought 2024 was hard for defence and security, the outlook at the beginning of 2025 suggests this year will be even riskier.
From 2020, all Australian defence ministers have said the strategic outlook has never been more challenging than since the end of World War II. We should be worried, even more so because the government and bureaucracy have no idea what to do about this situation.
Here, I set out 10 predictions for global and Australian security in 2025. As a country we need to be more focused on the big strategic events building a dark momentum around us. As voters, we should demand more from governments to strengthen our security. As individuals, we need to think about how to protect our families, our communities, our businesses and about how to plan for disruption.
Like it or not, understand it or not, that’s our future.
For most people terrorism was lower on the strategic radar in 2024, but the Christmas market vehicle attack at Magdeburg in Germany, the likely copycat attack in New Orleans on New Year’s Day and the Tesla Cybertruck explosion in Las Vegas all show the persistent nature of terrorism.
Last weekend in Inquirer I wrote that “bollards are back”. The debates about crowd security, about the need for individuals to be “alert but not alarmed”, show that strategic risk is not just about how countries compete for advantage but about how individuals protect themselves and their families.
While Australian defence concerns for decades have focused on our forces deployed in distant regions, now the prospect of war in Asia brings the dangerous reality of conflict much closer to home.
Strategists, myself included, are not especially brilliant at guessing future outcomes – think of the near universal European intelligence judgment that Russia was not about to invade Ukraine, for the second time, in February 2022.
In scenarios outlined here, I try to think forward from current trends. Directions can reverse, courses can change, often based on shifting political calculations. That is why building stronger military forces to deter aggressive intent is so important, and why domestic security is now so enmeshed with our global outlook.
1. A terrorist attack in Australia
ASIO boss Mike Burgess said in 2024 there was “a greater than 50 per cent chance of a terrorist attack in the next 12 months”. No one will be surprised if an attack is anti-Semitic in focus. We are in this situation because of Labor’s refusal to take anti-Semitism seriously and to play politics by pandering to an imagined Muslim community vote.
Our five-level national terrorism threat advisory system currently has Australia at level three, probable. If the level were to be raised to expected, that would imply quite precise intelligence information of a plot.
As we saw in New Orleans, a radicalised individual can unleash a devastating attack without such planning coming to the notice of security authorities.
Recent high-profile terrorist attacks globally, a tinderbox domestic situation with an angry anti-Israel protest movement and police forces’ reluctance to go in hard against protesters – these factors suggest a heightened terrorism risk in Australia.
Imagine the consequence now of a fatal firebombing, a mass shooting, a vehicle ploughing into a crowd. These are not outcomes of complex or lengthy planning. While our security agencies understand the risk, nothing suggests the government is mentally or organisationally ready to respond.
If we see a terrorist act in the next six months, that will surely lead to calls to explain why our federal government was so quiescent in the face of angry anti-Jewish mobs. Even if an attack is not anti-Jewish in intent, it will happen in the context of a more permissive environment tolerating public hate demonstrations. Yet the most we get from the government are lectures on the need to mind our language while it refuses to deal with the biggest source of hate speech: radical Islamism.
2. An AUKUS and alliance crisis
In an interview with The Australian published on Thursday, Anthony Albanese claimed his relationships with Indo-Pacific leaders would be valued by Donald Trump.
If this were a genuine strength, our Prime Minister, who is not averse to international travel, should have found reason to meet the US president-elect to offer ways to promote shared interests in the region. Other world leaders have been lining up to meet Trump.
On China, defence spending, climate and basic political orientation, the reality is there is no natural connection between Albanese and Trump. Sooner or later this will become a problem in the relationship.
Trump has a sharp nose for sensing when allies are free-riding. Expect that shortly after coming into office Trump will loudly call out Australia for failing to pull its weight – and he’ll be right. He will challenge Albanese, as he did Canada’s Justin Trudeau, in our case on a foundational part of the alliance: burden sharing.
Trump will demand we lift defence spending from 2 to 3 per cent of gross domestic product. He will claim that big talk about AUKUS delivering submarines in a decade does nothing to deter security threats today.
It’s one thing to annoy France by cancelling a submarine contract but quite another to annoy our principal security guarantor. That should lead to a mad scramble for Australia to address current defence failings.
Others may complain that Australian sovereignty is being compromised. Fine, Trump may say, design your own submarines, deploy your own marine corps.
Albanese will reap what he has sown leading a government where defence capability has weakened; think of buried helicopters, ships retired, satellites not launched and army vehicles cancelled. The Prime Minister will be on tenterhooks hoping not to receive a call from Mar-a-Lago before he calls the federal election.
Then there is our ambassador to Washington, Kevin Rudd, who has had many negative things to say about Trump, all of which adds up to Australia losing power and influence in Washington. Globally we are narrowing our foreign and defence policy outlook, meaning that fewer countries are interested in Australia’s policy views.
The Australian political figure with most influence in the US capital today is Scott Morrison. Why can’t Albanese tap that source in the interests of promoting better ties with the Trump team?
3. China blockades Taiwan
Testing Trump’s attitudes towards Taiwan, China will manufacture a crisis that justifies a military blockade of the island. This will test US deterrence and Trump’s character, defining his presidency.
In the past two years China has twice conducted exercises surrounding Taiwan with naval forces. Undersea cables linking the island to vital internet and communications are regularly damaged by Chinese “fishing boats”. Chinese combat aircraft threaten Taiwanese airspace daily.
Chinese leader Xi Jinping will test Trump’s appetite for cross-strait brinkmanship. A strong US and allied military response backing Taiwan will give Xi pause over a full-scale military attack. A weak response may persuade Beijing that Taiwan is China’s to strangle.
I expect that Trump will push back hard, rightly seeing a Chinese blockade as a play to reduce American influence in the Pacific. Trump doesn’t want to fight wars but he understands the US needs peace through strength, not capitulation.
In a strong response, the US will look to Japan and Australia for military support. Offering to send a ship will not pass any credibility test in Washington.
China would prefer to take over Taiwan peacefully, but Xi will use military power if there is no other option. If war happens, it will not be localised to Taiwan but spread quickly as the Chinese military looks to dominate a wide area.
There is no opt-out choice for Australia. China’s long-range missiles can reach all our military bases, intelligence facilities and population centres. Our government understands this and quite deliberately is choosing to reduce the strength of the defence force today in favour of what I call a “fantasy force” for the late 2030s.
Taiwan’s international status will be resolved long before then. The Australian who understands the Chinese leadership best is Rudd. Albanese should get Rudd to reshape our China policy, which he would do with a tough-minded realism, abandoning the fiction of our supposed stabilised relationship with Beijing.
4. Peace talks fail and war continues in Ukraine
Peace talks may start but they will be inconclusive. The Ukrainians will keep fighting through 2025. They are war-weary but there are no signs suggesting Ukraine will surrender to Vladimir Putin’s bloody land grab.
The issue isn’t American support but whether the Europeans will defend their own interests by boosting their arming and support of Ukraine. If Europe takes more of that burden Trump can claim a political win by forcing the allies to pay for more backing.
The best way to force concessions from Russia will be to persuade China to walk back its alliance with Putin – for example, ending North Korean troop deployments. What does Xi value more: Putin’s dependence and dangerous behaviour or better relations with Trump?
After three years it is clear that Ukraine can hold the Russians back – just – even when heavily outnumbered. And Kyiv keeps showing new and clever ways to damage Putin’s interests. The Ukrainians are far from defeated.
5. Putin’s leadership is tested to breaking point
The other side of the coin is that the Russian leader has largely exhausted his military options. You’re in trouble when malnourished and worm-infested North Korean peasants (yes, even the special forces) are the best available troops.
How long will Russia’s oligarchs and the military keep supporting Putin? As we saw in Syria, invincible-looking repressive regimes can fall very fast. Putin’s survival teeters between Xi’s backing and coerced domestic support.
The Russian conventional military has been exposed as corrupt and weak; the Russian economy relies on Chinese sanction-busting. Putin hesitates to ramp up conscription because he fears the Russian people turning against the war.
As with Bashir al-Assad in Syria, Putin’s position is fragile. A conflict that lasts long into 2025 will further raise the pressure on Putin. And now he faces a US president-elect wanting to restore American deterrence and unlikely to blink at Russian nuclear bluffing. The year 2024 was a shockingly bad one for Putin; 2025 may be his last as Russian dictator.
6. Israel attacks Iran’s nuclear system
Israel has just months to damage Iran’s nuclear program or risk Tehran attaining a nuclear weapon. Iran is vulnerable to a strike because Israel has comprehensively destroyed its air defences. I suspect the only thing holding back Israeli Prime Minister Benjamin Netanyahu is equivocation from the Biden White House.
The Trump administration will most likely support a strike. That means providing targeting assistance and weapons able to dig deep into buried nuclear facilities.
Since the Hamas horror attack of October 7, 2023, Israel has cemented its strategic dominance in the Middle East – no thanks to any of its fairweather friends in the West. Damaging, delaying and denying Iran a nuclear weapon is a vital Israeli interest.
Tehran may try to prevent a strike by claiming the regime will moderate and open up to the West. Following credible evidence that Iran was plotting to kill him, Trump won’t be fooled.
7. Saudi Arabia and Israel conclude a peace deal
Trump also will encourage a Saudi Arabian deal with Israel under the Abraham Accords. We know the timing of the October 7 Hamas attack from Gaza was driven by a fear that Saudi Arabia was close to a peace deal with Israel. In 2024 Hamas further lost the support of the Arab world and gained the left in Western democracies.
The year 2025 in the Middle East may usher in the arrival of a broad political accord between Sunni Arab countries and Israel; they share a common enemy in Iran. Saudi Arabia’s price will be a defence alliance with the US, which Trump will back to deliver the spread of his Abraham Accords.
Saudi Arabia will emerge as the pre-eminent Arab power in the Middle East.
Israel may cement a de facto relationship with Riyadh by decisively defeating the Houthis in Yemen. Yet another Iranian strategic error was to arm the Houthis with missiles able to attack Israel. Defeating the Houthis is a key Saudi aim and another reason a Saudi-Israel partnership would boost security in the Middle East.
A sad footnote here: Foreign Minister Penny Wong’s Middle East policy could not possibly have been more amateurish. We are fighting with Ireland for the prize of having the dumbest policy position on Israel.
8. Defence’s ‘workforce crisis’ deepens
In April 2024, Richard Marles announced there was a Defence “workforce crisis” as people left the military in droves. The supposed solution was “placing a strong focus on enhancing the culture of the organisation and improving workforce wellbeing”.
Nothing has changed. The latest Defence annual report shows a loss of 5420 Australian Defence Force personnel, or 9.5 per cent, down from an 11.1 per cent loss a year earlier.
A deepening defence force crisis in 2025 is not a prediction but an inevitability. People won’t join the ADF unless they think the organisation is strong, has a purpose and is backed by government.
It turns out that loudly spruiking the fantasy force ADF in the later 2030s doesn’t bring people in through the door today. Without a substantial turnaround in recruitment Defence won’t have the people to crew those future ships and submarines.
Opening ADF recruitment to British, New Zealand, Canadian and US residents in Australia who have not served in a foreign military in the past two years is just embarrassing tokenism.
Why aren’t we pitching for people currently serving in the Five Eyes military forces who are thinking of leaving? Defence’s last-century recruitment thinking will not deliver the people we need.
The reality of government policy is to weaken and shrink the ADF at precisely the time it should be growing a stronger force.
9. Cyber hack halts Australian economy
Cyber attacks are inevitable but the interlinked nature of Australia’s economy and infrastructure means that “system complexity” threatens to bring down the whole structure, at least for a few days.
Think of the Optus network failure in November 2023, where 10 million customers were left without internet and communications services. This wasn’t the result of a hack. Optus blamed a “network event” that “triggered a cascading failure, which resulted in the shutdown of services to our customers”.
Now imagine how that system complexity can be used by a potential criminal or state aggressor to shut down the economy, critical infrastructure and essential services.
Forgoing cash for the convenience of electronic payment is great when the IT is working but it means the retail economy instantly crashes after a major hack. Government sees the problem, but without a national security strategy in place we will be paralysed.
The benefits of networked connectivity shape modern life, but the complexity of this system is out of control and becoming all-pervasive with the overly hasty adoption of artificial intelligence systems. A cyber Pearl Harbor awaits.
10. A threshold moment for Australian diplomatic influence
The combination of Trump, an aggressive China and a contested Pacific means Australia will face a test of its regional leadership aspirations. Labor has done quite well with its diplomacy in the Pacific, bringing a consistent focus and a willingness to apply new strategies to blunt China’s relentless attempts to subvert, coerce or bribe the region into accepting its domination.
Beijing is doing this to support a wider strategy of pushing US military forces as far away from the Chinese mainland as possible.
A blocking presence in the central Pacific is an important part of that strategy, so China will keep pushing.
But a moment will come when diplomatic promises won’t be enough to secure Australia’s interests. China will continue searching for ways to establish a permanent military presence in the Pacific.
That starts with policy co-operation and ship visits and will end, Beijing hopes, with permanent military bases.
The nightmare scenario for Australia will be to find Chinese missile systems emplaced in locations throughout Melanesia. Impossible, you say? Keep watching. That would be the moment when the limits of a defence force of 57,226 permanent members becomes too sharply clear.
Labor’s tactical diplomatic successes are inconsequential measured against its strategic defence failures.
No one can buy back the time lost by 2½ years of defence dithering, underinvestment and whining about past Coalition efforts.
Hopefully I will be able to review my predictive hits and misses in 12 months. Much in 2025 depends on the character of the Trump administration.
It will be unpredictable but I hope it will emphasise American strength as much as it puts more demands on allies.
The bottom line is that, globally and regionally, 2025 will be a defining year. A demanding Trump may squeeze a better defence performance out of Australia. What a tragedy Canberra’s collected policy thinkers and our preening government leaders can’t do better of their own accord.
What should we do about this strategic mess? Future Australian governments will have to spend more on defence to overcome decades of underinvestment.
We must also shake a deep quagmire of complacency out of the public service and ADF. “Business as usual” is the cry in Defence. That, most certainly, is not the right approach.
Our foreign policy would be better if we started from the belief that Australia is a serious G-20 level country with global interests and interesting strategic ideas to bring to the table. We have a long way to go to overcome the declinist, small-target instincts of our diplomats.
Finally, how about a government that took national security seriously? We could revive the thinking and planning focus of the national security committee of cabinet, develop a national security plan and, like the US, have a policy office to drive new thinking.
This calls for high-quality, activist ministers, but Australia has been strongest on the international stage when our prime minister has led this policy thinking – think of Robert Menzies, Bob Hawke and John Howard. Albanese is not in that league.
Peter Dutton might grow into the role but first has to deliver the miracle of all election outcomes. A Labor minority government operating in a hung parliament is policy death for defence and security.
* Peter Jennings is director of Strategic Analysis Australia. He was executive director of the Australian Strategic Policy Institute from 2012 to 2022 and is a former deputy secretary for strategy in the Defence Department (2009-12).