China’s maritime “gray zone” operations represent a new challenge for the U.S. Navy and the sea services of our allies, partners, and friends in maritime East Asia. There, Beijing is waging what some Chinese sources term a “war without gunsmoke.” Already winning in important areas, China could gain far more if left unchecked. One of China’s greatest advantages thus far has been foreign difficulty in understanding the situation, let alone determining an effective response. With contributions from some of the world’s leading subject matter experts, this volume aims to close that gap by explaining the forces and doctrines driving China’s paranaval expansion, operating in the “gray zone” between war and peace. The book covers China’s major maritime forces beyond core gray-hulled Navy units, with particular focus on China’s second and third sea forces: the “white-hulled” Coast Guard and “blue-hulled” Maritime Militia. Increasingly, these paranaval forces, and the “gray zone” in which they typically operate, are on the frontlines of China’s seaward expansion.

Few studies have systematically tracked how China is using gray zone tactics-coercive activities beyond normal diplomacy and trade but below the use of kinetic military force-against multiple U.S. allies and partners. Lacking a foundational empirical baseline, it is difficult to determine patterns and trends in Chinese activities to develop effective counters to them. The authors developed a framework to categorize China's use of gray zone tactics against five U.S. allies and partners in the Indo-Pacific and to identify the most problematic People's Republic of China (PRC) tactics that the United States could prioritize countering. Based on open-source material, this report provides a more in-depth understanding of Chinese operations in the gray zone. Among other conclusions, the authors observe that China views gray zone activities as natural extensions of how countries exercise power. China employs such tactics to balance maintaining a stable, favorable external environment with efforts to alter the status quo in China's favor without triggering major pushback or conflict. It has used nearly 80 such tactics on its neighbors, often in relation to territorial disputes.

In an increasingly contested Indo-Pacific, the United States, Australia and their regional allies and partners face a myriad of strategic challenges that cut across every level of the competitive space. Driven by China’s use of multidimensional coercion in pursuit of its aim to displace the United States as the region’s dominant power, a new era of strategic competition is unfolding. At stake is the stability and character of the Indo-Pacific order, hitherto founded on American power and longstanding rules and norms, all of which are increasingly uncertain. The challenges that Beijing poses the region operate over multiple domains and are prosecuted by the Chinese Communist Party through a whole-of-nation strategy. In the grey zone between peace and war, tactics like economic coercion, foreign interference, the use of civil militias and other forms of political warfare have become Beijing’s tools of choice for pursuing incremental shifts to the geostrategic status quo. These efforts are compounded by China’s rapidly growing conventional military power and expanding footprint in the Western Pacific, which is raising the spectre of a limited war that America would find it difficult to deter or win. All of this is taking place under the lengthening shadow of Beijing’s nuclear modernisation and its bid for new competitive advantages in emerging strategic technologies. Strengthening regional deterrence and counter-coercion in light of these challenges will require the United States and Australia — working independently, together and with their likeminded partners — to develop more integrated strategies for the Indo-Pacific region and novel ways to operationalise the alliance in support of deterrence objectives. There is widespread support for this agenda in both Washington and Canberra. As the Trump administration’s 2018 National Defense Strategy makes clear, allies provide an “asymmetric advantage” for helping the United States deter aggression and uphold favourable balances of power around the world. Australia’s Minister for Defence Linda Reynolds mirrored this sentiment in a major speech in Washington last November, observing that “deterrence is a joint responsibility for a shared purpose — one that no country, not even the United States, can undertake alone.” Forging greater coordination on deterrence strategy within the US-Australia alliance, however, is no easy task, particularly when this undertaking is focussed on China’s coercive behaviour in the Indo-Pacific. Although Canberra and Washington have overlapping strategic objectives, their interests and threat perceptions regarding China are by no means symmetrical. Each has very different capabilities, policy priorities and tolerance for accepting costs and risks. Efforts to operationalise deterrence must therefore proceed incrementally and on the basis of robust alliance dialogue. To advance this process of bilateral strategic policy debate, the United States Studies Centre and Pacific Forum hosted the second round of the Annual Track 1.5 US-Australia Deterrence Dialogue in Washington in November 2019, bringing together US and Australian experts from government and non-government organisations. The theme for this meeting was “Operationalising Deterrence in the Indo-Pacific,” with a focus on exploring tangible obstacles and opportunities for improving the alliance’s collective capacity to deter coercive changes to the regional order. Both institutions would like to thank the Australian Department of Defence Strategic Policy Grants Program and the US Defense Threat Reduction Agency for their generous support of this engagement. The following analytical summary reflects the authors’ accounts of the dialogue’s proceedings and does not necessarily represent their own views. It endeavours to capture, examine and contextualise a wide range of perspectives and debates from the discussion; but does not purport to offer a comprehensive record. Nothing in the following pages represents the views of the Australian Department of Defence, the US Defense Threat Reduction Agency or any of the other officials or organisations that took part in the dialogue.

The Indo-Asia-Pacific region is critical to the national interests of the United States. Despite our best efforts in promoting growth and prosperity through our committed presence and engagement, the challenges that we face are no small task. North Korea's nuclear tests have openly defied the international call for a nuclear-free Korean Peninsula, and the regime uses hybrid and asymmetric warfare to reinforce its survivability and to exert undue influence. China continues to press its claims in the South China Sea, and their actions have shown that it too will resort to gray zone tactics short of open conflict to achieve foreign policy goals. We have resumed our freedom of navigation operations in the South China Sea, a waterway vital to America's prosperity, where $5.3 trillion in trade traverses each year. Instead of further provocation, China should abide by internationally accepted norms and contribute to a peaceful and equitable resolution to the disputed claims. A revanchist Russia is revitalizing its ability to execute long-range strategic patrols in the Pacific to include the basing of its newest strategic ballistic missile submarine and bomber flights around Japan. Recent terrorist attacks in Bangladesh and Indonesia underscore the fact that violent Islamic extremism is a global concern that must be crushed. These developments emphasize the need for a persistent U.S. presence. We should continue to bolster collective security, help to peacefully address concerns, facilitate productive multilateral exchanges, encourage democratization efforts, and reinforce ties with our many allies and partners.

Hybrid Threats and Grey Zone Conflict explores the legal dimension of strategic competition below the threshold of war, assessing the key legal and ethical questions posed for liberal democracies. Bringing together diverse scholarly and practitioner perspectives, the volume introduces readers to the conceptual and practical difficulties arising in this area, the rich debates the topic has generated, and the challenges that countering hybrid threats and grey zone conflict poses for liberal democracies.