29 February 2024

This Week:
US Vetoes Gaza Ceasefire Resolution
Law Enforcement Dismantles LockBit
Germany Officially in a Recession
Indonesia Passes Tech Regulations
China Cuts Benchmark Mortgage Rates
Red Sea and Indian Ocean Insecurity
Migration Top Concern in Europe
Chatham House Report on American Civil War

Egypt Building Sinai Enclosure, Considering Ending Treaty with Israel


Satellite imagery by Maxar Technologies strongly indicates that Egypt has cleared a 6 square mile piece of land and is building a walled enclosure in the Sinai in preparation for the IDF’s Rafah offensive. The Sinai Foundation for Human Rights has stated that the enclosure has 23-foot-high walls, and the structure could hold more than 100,000 people. The Rafah offensive is highly likely to occur within the next six weeks, and Israeli Prime Minister Netanyahu has stated that this military operation is necessary to eliminate Hamas. Considering there are 1.4 million Palestinians in the city, there is extremely likely to be excessive civilian deaths and a high-level of refugees.


Egypt has consistently opposed opening the border with Gaza to let refugees through because they are concerned about terrorism from Hamas and strained resources, but an attack on Rafah would not stop refugees from flooding over the border. Hamas also has ties to the Muslim Brotherhood in Egypt because the terrorist group is an offshoot of the Islamist organization. Egypt is especially concerned that Hamas fighters could be among the refugees, and they would start attacking Israel from Egyptian soil (or attack the Sisi government).


There is concern that Egypt could revoke the Camp David peace treaty from 1979 if the Rafah offensive moves forward, according to both Egyptian and Western diplomats. This remains an unlikely scenario because the US would stop sending aid to Egypt, and Israeli gas exports would decrease or end, harming Egypt’s fragile economy. However, domestic political pressure could credibly lead to this scenario, which would significantly increase regional instability and lead to a possible interstate conflict. This would have extremely negative economic, security, and humanitarian implications for the region, particularly because of the criticality of the Suez Canal to the global supply chain.

Japan Subsidizes New TSMC Plant


Japan will give Taiwan’s TSMC approximately $4.86 billion in subsidies to help build a second chip fabrication plant. TSMC opened its first plant in Japan in February 2024. According to the Minister of Economy, Trade, and Industry, "The chips will be more advanced than the first factory and can be used for AI and autonomous driving, and will ensure we have stable supply of semiconductors in Japan.” Building advance semiconductor fabricators in Japan is part of Tokyo’s plan to create a more secure supply chain against disruptions from China’s threats. After the second factory is built, they will make more than 100,000 12-inch wafers that can supply technology firms and automobile makers. The US, Germany, and others are also trying to bolster the semiconductor supply chain, and this will be an important step in preventing China from disrupting the process in case of sanctions, theft, and war.

LockBit Returns With New Infrastructure


Following the internationally coordinated law enforcement operation against LockBit, the group is now relaunching its ransomware operation with new infrastructure, and they are threatening to start targeting the government sector. The ransomware gang created a fake FBI leak to publish a message about government insecurity. In addition, they provided details about how they will be more difficult to hack in the future because the governments allegedly gained access through “personal negligence and irresponsibility,” by which they meant law enforcement had gained access to personal information concerning the representative(s) for LockBit. This will likely increase the risks from ransomware gangs as they will attempt to retaliate against governments, but it could also create risks for corporations who have been targeted in the past.

Transnistria Seeks Possible Relationship with Russia


Officials in Transnistria, the breakaway part of Moldova, held a conference on February 28 and actively sought Russian support in their negotiations with the Moldovan government, though annexation was not directly supported. There is concern that the so-called Pridnestrovian Moldavian Republic would seek to become part of Russia despite being separated by Ukraine. If Russia is not able to occupy Odesa in Ukraine, then it is unlikely they could annex Transnistria. However, Russian soldiers in the territory combined with Transnistrian militias outnumber Moldova’s army, and they likely could annex them if they want. The broader concern is that Romania, a NATO member, could intervene if the conflict spirals further.

Meta Attempts to Combat Disinformation from AI


Meta’s Facebook has established a team to deal with disinformation and abuse of generative AI leading up to the European Parliament elections in June. There is increasing concern generally about how generative AI will harm the integrity of elections, but it is extremely unlikely that Facebook will be able to deal with the major issues. The company was unable to manage text-based disinformation in the 2016 and 2020 US presidential elections. When they tried to control information in the past, they were shown to have demonstrated political bias in their decision making. The company’s anti-conservative leanings (especially in internal discussions) could have negative implications in European elections if right-wing populists use it as part of their narrative to attract voters.

New Executive Order on Data Protection


The Biden administration issued an executive order to stop data brokers from selling Americans’ data to China, Russia, and other “countries of concern. Relevant data include genomic, biometric, health, geolocation, financial, and other PII. The executive order stated, "The sale of Americans’ data raises significant privacy, counterintelligence, blackmail risks, and other national security risks” because the data can be used “to intimidate opponents of countries of concern, curb dissent, and limit Americans’ freedom of expression and other civil liberties." This is part of the trend in technology balkanization as data is critical to developing and applying new technologies, but it also shows the serious risks that personal data creates in geopolitical competitions. It is now increasingly likely that data localization and stronger regulations will take place throughout the West.

Sweden to Become Part of NATO


Sweden will now become part of NATO after Hungary’s parliament ratified the bid on February 26, which was the final hurdle for the Nordic country to join the security alliance. In response, Swedish Prime Minister Ulf Kristersson posted that “Sweden stands ready to shoulder its responsibility for Euro-Atlantic security.” Previously, Hungary opposed membership because politicians in Sweden made derogatory comments about Budapest’s democratic backsliding. Once Sweden joins the North Atlantic Treaty then it will be part of the collective security agreement, it will likely increase European unity in opposition to Russia. Sweden is actively pursuing a military budget of 2% of GDP, and it would be one of the few countries in NATO to meet that objective. In addition, Sweden shares a border with Russia, and this will likely be an important step in preventing an expanding Russia.

New Research on Cyberwar – Henry Jackson Society


There is new research published by the Henry Jackson Society, a UK-based think tank focused on foreign policy that defends Western values, has highlighted lessons learned from the cyberwar in Ukraine. From the report: “Russia’s full-scale invasion of Ukraine triggered the largest war in Europe since World War II.” The invasion also marked the first all-out cyber war between two nation-states, as Russia attempted to integrate cyberattacks with physical strikes. Ukrainian digital infrastructure and systems were put to the test against what many experts previously feared would be a ‘digital Pearl Harbor’. Just as Ukraine’s valiant resistance on the battlefield took the world by surprise in the early days of the war, its cyber defences also stood firm, successfully weathering the initial cyber onslaught.”

“Nature does not hurry, yet everything is accomplished.”

- Lao Tzu

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