August 12, 2026No Comments

Security, Economy, Alliances: Drivers of US Policy Toward Iran

By Anurag Mishra (US Team) and Martina Ferraresi (Iran Team)

Introduction

Divergent foreign policy philosophies have produced recurring patterns in US policy toward Iran since 2001. Rather than tracing a single ideological arc, three analytical drivers - security imperatives, economic instruments, and alliance commitments - better explain the continuities and ruptures across administrations, revealing why engagement and confrontation have repeatedly alternated without resolving the underlying strategic dilemma.

Security: The Nuclear File and the Proxy Threatย 

In 2002,ย President Bushย labelled Iran part of the โ€œAxis of Evilโ€ over its nuclear program. Aย 2007 US National Intelligence Estimateย found Iran had likely halted covert weaponisation by 2003, followed byย 2006 UN sanctions. Diplomacy under President Obama produced theย JCPOAย in 2015, restricting Iranโ€™s program in exchange for sanctions relief.ย President Trumpย withdrew the US from the agreements in 2018, despite the IAEAโ€™s verified Iranian compliance; by July 2019, Iran breached its limits on its stockpile of low-enriched uranium, going beyond theย JCPOAโ€™s cap.ย President Bidenโ€˜sย Vienna talks in 2021 stalled by 2022, with sanctions remaining in place. Iran began enriching toย 60%, reaching roughlyย 3,800ย kg by August 2022, with experts warning that it contained sufficient fissile material for at least one nuclear device, although weaponisation would require additional technical steps.

Furthermore, Iranโ€™s strategic doctrine relies deeply onย proxy warfareย through the โ€œAxis of Resistanceโ€, a decentralised network including Hezbollah, Hamas, the Houthis, and Shiสฟa militias. Rather than deploying its own forces directly,ย Iranchannels weapons, training, and funding through the IRGCโ€™s Quds Force, often via Hezbollah, to partners whose local agendas align with Tehranโ€™s goal of pressuring Saudi Arabia, Israel, and the US. This asymmetric architecture lets each actor pursue its own interests while serving Iranian power at low cost. Theย 2020 killingย of Quds Force commanderย Qassem Soleimaniย struck this networkโ€™s operational core but did not dismantle it: after Hamasโ€™s October 7, 2023, attack, the entire axis mobilised in coordination, closing what little remained of any diplomatic window and locking the region into a new cycle of escalation.

Economy: Sanctions as Strategyย 

Sanctions have functioned as the USโ€™s primary lever of coercive diplomacy against Iranโ€™s nuclear program. In July 2010, Congress passed CISADA, marking the shift from targeted export controls to systemic financial warfare. The meaning of CISADA was to sanction foreign banks and companies for doing business with Iranโ€™s energy sector or sanctioned Iranian entities, effectively forcing them to choose between access to Iran and access to the US financial system. The EU further escalated pressure in 2012 with an oil embargo, banning imports of Iranian petroleum products, sanctioning Iranโ€™s energy, financial, and transport sectors, and freezing the Central Bank of Iranโ€™s assets. Subsequently, Iranian banks were expelled from SWIFT, cutting Iran off from international banking and severely constraining its ability to sell oil or access hard currency. After withdrawing from the JCPOA in 2018, Trump launched his first โ€œMaximum Pressureโ€œ campaign, reimposing sanctions on Iranโ€™s energy, shipping, and financial sectors and designating the IRGC a Foreign Terrorist Organisation. In February 2025, Trump reinstated the campaign, aiming to drive Iranโ€™s oil exports to zero, with the stated goal of making Iranโ€™s economy collapse by shutting down its oil sector.

Alliances: Israel, the Gulf, and Europe

Israel 

Israel has shifted from a proxy war to a direct engagement with Iran. In April and October of 2024, the two nations faced direct state-to-state strikes that broke the decades-old tradition of โ€œshadow warโ€, and Israel launched an open-air war on Iranโ€™s nuclear and military infrastructure in June 2025, dubbed the Twelve-Day War, that included a one-off US strike on Fordow, Natanz and Isfahan, before a ceasefire took effect on June 24, 2025. Israelโ€™s air power has been widely assessed to have weakened, but not destroyed, Iranโ€™s nuclear program, which is why American bunker-buster bombs were reportedly needed to strike the deeply buried Fordow facility. This delicate balance was once again upset in February 2026, when on February 28 joint US-Israeli missile attack launched against Iranโ€™s military struck senior Iranian military officials, including Supreme Leader Ali Khamenei, and initiated five weeks of regional conflict that ended with a ceasefire agreement on April 7-8, 2026, which was followed by a formal memorandum ending the conflict signed by Presidents Trump and Pezeshkian on June 17, 2026. Washingtonโ€™s relationship with Israel appears to have moved from arms sales and diplomatic backing toward something closer to direct co-belligerency, which many read as a strong signal that for Washington and Israel, a nuclear-armed Iran is treated as a red line rather than mere rhetoric. 

Arab / Gulf Partners

The Gulf countries have been hedging rather than aligning themselves. Riyadhโ€™s 2023 Chinese-brokered deal with Tehran signalled a willingness to reduce risks as opposed to confronting Tehran, but Israelโ€™s air strike on Hamas leaders in Doha over a US ally that hosted a US air base complicated existing doubts about the USโ€™s security guarantees in the Gulf region. The Saudi-Pakistan Strategic Mutual Defense Agreement of September 17, 2025 was signed by the two nations, both of which agreed to consider an attack on one as an attack on the other, and was widely interpreted not only as a hedge against an uncertain Washington, but also against an unchecked Israel as well. Some have suggested the deal could extend a nuclear umbrella to Saudi Arabia, although analysts caution against reading it as a formal war guarantee. Analysts have also pointed out that the agreement may lead to a new UAE-India defence cooperation, adding another layer to the Gulf security architecture, but not necessarily replacing it. The net result is a Gulf that is apparently diversifying its security guarantors, while staying formally in the US orbit.

Photo: Creative Commons - Ali Khamenei e Mojtaba Khamenei

European Allies

Through the JCPOA, Europe has primarily exercised its influence through diplomacy, sanctions, and multilateral institutions rather than military means. Following years of patience, France, Germany and the UK applied theย โ€œsnapbackโ€ย mechanism of the JCPOA on 28 August 2025, overย Iranโ€™s repeated failure to complyย with its nuclear obligations, including the production of highly enriched uranium without any apparent civilian purpose. The E3 said the enriched-uranium stockpile in Iran was about 48 times the limit imposed by the JCPOA and that there are ten โ€œsignificant quantitiesโ€ of highly enriched uranium in Iran. Sanctions that had been lifted under the 2015 deal were therefore restored, and by the end of September 2025, the EU also reimposed its own nuclear sanctions, such as asset freezes and travel bans. At the time, Russia and China argued the E3 lacked a legal mandate to trigger a snapback, as the Security Councilโ€™s authority over the file had expiredย -ย and did so until the Council split over the issue along the same lines it has before. So, now, Europeโ€™s role in Washingtonโ€™s alliance is more about legal and multilateral legitimacy than military readiness: the E3 provided a UN Security Council seal of approval on Iranโ€™s isolation that the unilateral US sanctions could not.

Conclusion

Security considerations remain the unalterable policy of the United States government, and, regardless of the differences in administration temperament over the course of four different administrations, no administration appears to have accepted a nuclear-armed Iran as a tolerable outcome. By 2025-26, this red line was enforced not only through sanctions but also through direct military strikes against Iranian nuclear infrastructure and leadership - a shift that many analysts see as marking a new phase in US policy. However, its long-term durability remains to be seen.

Alliance commitments have been fulfilled on paper, but not in practice. Israelโ€™s evolution from an โ€œactiveโ€ to a โ€œco-belligerentโ€ has drawn the US-Israel relationship closer,  while also placing strain on US relations with the Gulf states.Among these, Saudi Arabia appears to be leading efforts to diversify its security architecture, notably through its agreement with Pakistan, with a possible parallel arrangement with the UAE reportedly under discussion. Meanwhile, European allies have shown that legal and multilateral instruments can still carry weight even without direct US military backing, having reinstated UN sanctions in a context where unilateral US measures could not achieve the same effect.

The economic sanctions are the most flexible instrument in the policy toolkit, however - reversible, calibrated and renewable - and there is room to manoeuvre towards negotiations even after the outbreak of military conflict, provided that Tehranโ€™s nuclear ambitions are kept in check.

What has been most important in the evolution of US Iran policy since 2001 is this asymmetry: rigid security boundaries, malleable economic measures and more and more varied rather than monolithic alliance pledges.

August 12, 2026No Comments

Europe as an Actor: Challenges and the Way Forward

On June 6th, 2026, ITSS Verona and Kingโ€™s College London hosted a closed-door, Chatham House Rule panel discussion amongst EU, NATO and academia representatives, focusing on โ€œEurope as an Actor Amid War: Challenges and the Way Forwardโ€. The event explored the potential reshuffling of the international order, Europeโ€™s role in supporting regional security, and possible pathways for sustainable conflict resolution.

The Union Mediating

A high EU officer opened the panel by stating that de-escalation and prosperity in the region seem to heavily rely on seeking the deal between Iran and the United States. They specified that negotiations might prove to be more conditions-based than time-bound, with pressing nuclear aspects yielding matters linked to Lebanon and Hormuz. Yet, it is understood that the United States will have to balance Israeli interests and would probably benefit from Israeli limited operations in Lebanon in order to facilitate a deal with Iran. 

The EUโ€™s support towards mediation between the U.S. and Iran during the Biden administration led to a nearly complete return of the Joint Comprehensive Plan of Action (JCPOA), for a final deal was essentially ready to be implemented. However, Iranโ€™s drone support for Russia following the invasion of Ukraine and, most importantly, the regional escalation involving Israel and Iranโ€™s allies suspended such negotiations. Building on this example, the speaker pointed to continuous dialogue, including with opposing counterparts, as key to achieving a sustainable agreement - even though, to be fair, the EUโ€™s late reaction to the crisis following Operation Epic Fury, reflecting the experience of the war in Ukraine, has been characterised by internal division based on risk and dependence on U.S. strategic direction.

Concerning the EUโ€™s support in the resolution of the crisis, the speaker wished to recall previous historical failures, including Afghanistan and Libya, emphasising the need for a region-led process meant to rebuild and strengthen the regional security architecture. Furthermore, amid the current geopolitical context, the EU should secure strategic autonomy without completely separating from the U.S. To the speaker, the EU should be more supportive of its bilateral partners in the Gulf, develop multilateral partnerships with both the Gulf Cooperation Council (GCC) and its member states, and equip the latter with knowledge and tools to tackle the conflict without direct European intervention. 

Amongst Recalibration of Alliances

All in all, one of the most high-level impactful consequences of Operation Epic Fury has been the emergence of new regional dynamics which could be described as the โ€œCold War of the Gulfโ€. Iranโ€™s retaliatory strikes on GCC states have disrupted Gulf diplomacy and regional ties: GCC countries that had attempted to normalise ties with Iran in the past few years are now reassessing them, pushing Iran towards a long-term regional isolation despite any tactical results against the U.S. Crucially, the war is provoking substantial change more outside of Iran than within it. New alignments and alliances are forming across the region: Bahrain and the UAE are broadly on the same side against Iran, while Turkey, Egypt and Saudi Arabia are coordinating on ceasefire efforts. What is significant about these new alignments is their depth, as regional actors are switching from political alliances to defence commitments, filling the vacuum left by the collapse of a relatively functioning multipolar balance. 

Alongside diplomatic repositioning, GCC countries are also rethinking their security partnerships, as their trust in the U.S. as the sole guarantor of security has been called into question, potentially benefiting the EU. The caveat noted by the speaker is that security diversification should not be framed as replacing the U.S. but, rather, as building resilience in a context where reliance on a sole partner has proven risky.

Energy security is also a concern in the context of this conflict, forcing countries to reshape regional energy infrastructures. Iranโ€™s retaliatory strikes disrupted Qatari LNG production whilst closing or somehow impeding the flow of goods through the Strait of Hormuz. Saudi Arabiaโ€™s East-West pipeline, the Petroline, has allowed Saudi Arabia to circumvent the closure, but major issues remain. In any case, long-term implications are clear. First, new alternative pipelines or energy routes will be needed in the region. Second, the question of maritime security through Hormuz will need to be addressed.

The EU officer concluded that the most optimistic current future scenario is a โ€œno peace, no warโ€ situation, where the conflict freezes rather than resolves. Strong reputational and economic incentives such as EXPO 2030 in Saudi Arabia, as well as trade and export relationships, give actors reasons to avoid prolonged conflict, although these have not been sufficient to produce a lasting peace. Thus, the risk is not a further escalation but the stalling of the conflict, an indefinite Gulf Cold War.

The Role of NATO 

In light of this, our NATO speaker took a step back to illustrate the evolving security panorama and the need for NATO to upgrade to address the new features defining contemporary conflicts. While the Alliance continues to be founded on its three core tasksโ€”crisis management, defence and deterrenceโ€”the current geopolitical context is increasingly shaped by overlapping crises, which naturally translates into major pressure to strengthen military capabilities. As a consensus-based organisation, NATO has to face different coalitions among its Allies, reflecting diverging views on the nature of contemporary warfare and on the most appropriate responses to current security challenges.

In line with the current developments, NATO has allocated particular attention to its engagement in the Middle East. Unlike the EUโ€™s decision to appoint a High Representative for the GCC, NATO only features limited institutional presence in the region, with structures in Kuwait (and previously in Iraq), with no broader, permanent infrastructure. This was presented as a constraint on NATOโ€™s ability to develop cooperative security, especially considering the importance of sustained political dialogue and direct engagement with regional partners. At the same time, Ukraine remains NATOโ€™s primary strategic priority, while current discussions also reflect the influence of different Allied positions on the organisationโ€™s future direction.

Human Security?

The situation in the Middle East brings another central topic to the forefront: the predominance of military considerations in contemporary security debates vs the absence of the human dimension. Current conflicts are increasingly discussed in terms of warfighting and military preparedness, while less attention is devoted to the impact on civilians and society as a whole. The war in Ukraine was identified as a significant example of this transformation, where civilians are no longer affected only as collateral damage. This development raises questions about whether existing normative frameworks remain sufficient to address the realities of contemporary warfare.

In response to these challenges, NATO ought to increasingly concentrate upon a whole-of-society approach to security. Training armed forces alone may be no longer sufficient; societies must become more resilient through the involvement of public institutions, the private sector and civil society. Security should therefore be understood as a shared responsibility that extends beyond military structures and incorporates the protection of civilians, critical infrastructure and democratic institutions.

Middle Powersโ€™ Momentum

Finally, the last academic panellist highlighted the growing role of the Gulf states in conflict in the Middle East, the unique position occupied by middle powers, and the need for a shifting conceptualisation of women in modern warfare in particular, underscoring that wars in the Middle East can no longer be understood simply as a proxy for great power politics. An interesting case study in this context would be Tรผrkiye. According to the speaker, Tรผrkiye would have embraced the role of mediator to stop the war in Iran from escalating in the first place. This reinforces the conviction that Tรผrkiye is fully stepping into its position as a middle power, particularly as it allows it to act as a primary negotiator in geopolitical conflict. 

Voices within Tรผrkiye are also stressing the need to prepare for the security implications of an escalating war with Iran, both domestically and in relation to its international priorities, the speaker reported. Concerns about the strength of Tรผrkiye's borders and migration flows linked to the conflict were said to be increasing. After all, a middle power like Tรผrkiye cannot and does not operate in isolation, but has to make sense of other important regional and global actorsโ€™ ambitions. 

Finally, the panellist also questioned the United Statesโ€™ military aims in Iran, asking whether Washington is eventually aiming for full regime change or merely the installation of a government that is more receptive to collaboration with the U.S. 

Discussion

During the Q&A, major emphasis was placed on the role women might play in conflict. Participants stressed that womenโ€™s roles in conflict were shifting, particularly when it comes to the future of the Women, Peace and Security (WPS) Agenda following adoption of United Nations Security Council Resolution 1325. After 25 years, principles remain valid but both language and implementation must evolve to reflect todayโ€™s security environment. 

Instead of framing the debate around the traditional distinction between participation and protection, the WPS Agenda should be presented as an enabler of a gender-sensitive security umbrella. Significantly, this requires recognising women not only as those affected by conflict but also as active contributors to security and resilience, and leaving behind old notions of women as merely as victims of human rights abuses. More importantly, this angle highlights the importance of an understanding of the particular gendered context in peacebuilding efforts. For example, part of the problem of the WPS agenda is that women have not been registered as agents of conflict, but only as passive civilians in charge of care duties. In the case of the Rwandan War, women are known to have contributed to genocide, with former Rwandan Minister for Family Affairs and Womenโ€™s Development Pauline Nyiramasuhuko ordering the rape of Tutsi women. omen today are also combatants and active participants in war. It was noted that 75,000 women have joined the Ukrainian army as volunteers, and are occupying roles as drone operators, engineers, and driving gender-responsive recovery efforts.

When it comes to the Middle East, women's direct involvement in regional conflicts, including Iran, is less visible than in other contexts. Yet a significant number of female protestors against the regime have been killed or jailed, whereas Iranian Kurdish women have actively taken up arms against the regime. Looking ahead, it is not clear whether co-development of military equipment, such as drones, between Ukraine and the Gulf states will offer women more prominent roles within the warfighting establishment, but there will most likely be new developments in this sense too. 

What is clear, however, is that wars in the Middle East are not just an extension of ideological and military conflicts among great powers, and contributors to modern warfare extend far beyond those typically considered. Middle powers such as Tรผrkiye are becoming increasingly impactful, Gulf states are occupying a prominent role, and women are becoming agents and drivers of modern conflict.

In conclusion, the event has offered substantial opportunity for reflection and critical engagement. Whilst Europe remains central, most of the notions presented by the panel would require further discussion, debate, and, above all, implementation. Thanking all speakers and actors, ITSS Verona wishes this to be nothing but a great starting point to spark debate on the role of Europe in Iran and beyond.  

July 18, 2026No Comments

Theaterisation of Indiaโ€™s Armed Forces and its impact on South Asian Security

By ย Zorawar Singh - South Asia Team

During Indiaโ€™s 73rd Independence day speech in 2019, Indian Prime Minister Narendra Modi announced the creation of the position of a โ€˜Chief of Defence Staffโ€™ (CDS) who would be responsible for enhancing the integration of the Indian Armed Forces and โ€œto bring about synergy in operation, logistics, transport, training, support services, communications, repairs and maintenance, etc of the three Services.โ€ (Press Information Bureau, 2020). The years following the announcement were marred by inter-service rivalries and concerns over the division of assets, expressed particularly by the Indian Air Force (IAF) until April 2026 when the then CDS General Anil Chauhan stated that a proposal on theaterisation would soon be shared with the government following a โ€œ100 per cent agreement on the concept of theaterisationโ€ even as minor differences on the implementation persisted. While a specific timeline for when these reforms will be implemented has not yet been specified, given Indiaโ€™s position as a major, if not premier, military power in the South Asia, these are likely to have a significant impact on South Asian security.

Impact on the Indian Armed Forces

At present, the three branches of the Indian Armed Forces operate largely independently of each other and are organised under โ€˜commandsโ€™. The Army has seven commands (six operations and one training command), the Air Force has seven (five operational and two functional), and the Navy has three. This has resulted in issues such as parallel command structures, resource duplication, and slower decision-making. Committees such as the Kargil Review Committee (1999) and the Shekatkar Committee (2016) have emphasised the need for Indiaโ€™s armed forces to develop a more joint method of functioning, and theaterisation seeks to model Indiaโ€™s military more along the lines of Western ones, where the assets of all branches work in tandem to enhance operational effectiveness.

From India's perspective, theaterisation promises several operational advantages. First, integrated commands could improve intelligence sharing, streamline logistics, and enable faster responses during military crises. Second, unified command structures may also reduce bureaucratic friction between services and improve the efficient allocation of defence resources. This is particularly relevant in the context of India's security challenges. The 2020 Galwan Valley clashes with China highlighted the need for rapid coordination between ground forces, air assets, surveillance systems, and logistical networks. Similarly, India's continuing rivalry with Pakistan requires the capability to respond effectively across multiple domains and fronts, as seen in the clashes in May 2025.

A more integrated military structure could therefore enhance India's deterrence capabilities by increasing the credibility of its conventional military power. Potential adversaries may perceive a theaterised Indian military as more capable of executing coordinated operations, thereby raising the costs associated with military escalation.

Impact on the India-Pakistan Military Balance

The impact of theaterisation of Indian Armed Forces on India-Pakistan relations is likely to be mixed. On one hand, enhanced military coordination could strengthen deterrence by reducing uncertainty regarding India's ability to mobilise and conduct operations. A more effective conventional force may discourage Pakistan from engaging in limited military provocations or supporting cross-border militant activities and Op. Sindoor showcased Indiaโ€™s willingness to respond to terror attacks in India with conventional force, including the targeting of assets and infrastructure belonging to the Pakistani armed forces.

On the other hand, Pakistan may interpret theaterisation as part of a broader effort by India to achieve conventional military superiority. Given the asymmetry in economic and military resources between the two states, Pakistanhas traditionally relied on nuclear deterrence to offset India's conventional advantages. Any reform that significantly enhances India's operational capabilities could reinforce Pakistani concerns regarding strategic vulnerability.ย  This perception may further encourage Pakistan to modernise its military capabilities, leading to reforms within Pakistan as seen with the establishment of the Army Rocket Force Command (ARFC), invest in advanced missile systems, and continue expanding its tactical nuclear arsenal. Such developments could contribute to a regional security dilemma, whereby measures taken by one state to increase its security are perceived as threatening by another, resulting in reciprocal military build-ups.

Furthermore, the reality of the India-Pakistan rivalry has gradually been altered since the Uri attacks in 2016. The Modi-led government, during each major terror attack in its tenure, has shown a willingness to go up the escalation ladder from limited surgical strikes in 2016, limited airstrikes in 2019, to now an exchange of missiles and drones targeting military assets and infrastructure. The ruling Bhartiya Janata Party governmentโ€™s voters now expect a โ€˜strongโ€™ response (targeting the Pakistani army directly) whenever a terror attack occurs in Indian territory, meaning the window and scope for a negotiated resolution have become significantly smaller. To add to this, Pakistanโ€™s continued and growing cooperation with China in countering Indiaโ€™s traditional military advantage will likely also be furthered by Indiaโ€™s military reforms, besides impacting the relationship between India and China, as discussed below.

Photo by Naveed Ahmed on Unsplash

The China Factor

The most important strategic driver behind Indiaโ€™s theaterisation of its armed forces is arguably China's growing military power. Since the 2020 border crisis, Indian defence planners have increasingly focused on the challenge posed by the People's Liberation Army (PLA) along the Line of Actual Control (LAC). China's own military reforms offer an important point of comparison. Between 2015 and 2017, Beijing undertook extensive military restructuring, replacing its traditional military regions with integrated theatre commands designed to improve joint operations. Chinese reforms have significantly enhanced the PLA's ability to coordinate forces across different domains and operational theatres.

Indian policymakers view theaterisation partly as a response to this changing military balance. By integrating its own command structures, India seeks to improve readiness and operational effectiveness in the event of future border confrontations. Enhanced jointness may enable India to better coordinate surveillance, airpower, logistics, and ground operations across the Himalayan frontier.

However, this dynamic may also contribute to intensifying strategic competition between Asia's two rising powers. As both states continue to modernise their militaries and improve operational capabilities, the risk of military rivalry becoming increasingly institutionalised cannot be dismissed. While theaterisation itself is not inherently destabilising, it forms part of a broader pattern of military modernisation occurring on both sides of the border. Furthermore, an increase in tensions between China and India has the potential to spill over into a wider regional confrontation where both states may seek to increase their influence in other South Asian countries and see attempts by the other to do the same as a potentially hostile act by the third state.

In conclusion, Indiaโ€™s theaterisation reforms may be aimed solely at enhancing its own military readiness and the joint operational capability of its armed forces and may be without an offensive goal in mind. However, this may not be how other states, particularly Pakistan and China view it, and reciprocal reforms and measures to enhance their own capability have the potential to lead to an increased risk of conventional conflict in South Asia, a reality which was briefly seen in the India-Pakistan conflict in 2025.

July 6, 2026No Comments

Active cyber defence and generational trends in using technology

By Maria Makurat - Human Rights and Cyber Security Teams

Introduction 

โ€œCouldnโ€™t we just shut it off? You know, cut the wires?โ€ โ€œThere is no if, it cannot be shut offโ€.(Oceanโ€™s 13, 2007). Nearly 20 years later, the thought of implementing an artificial intelligence (AI) machine is now very likely and no longer a fiction when thinking about casinos or other institutions. With the continuous rise of AI new cybersecurity threats are and will take place so, โ€œpick your natural disasterโ€ (Oceanโ€™s 13, 2007). The development of autonomous weapons (AWs) and large language models (LLMs) are increasingly playing a role in testing cyber defence strategies of countries such as Germany and the rest of the EU. The international affairs field is continuously asking questions about: ethics in cyber warfare, cognitive warfare and AI, how to describe certain attacks, how can one analyse a countryโ€™s cyber strategy in the first place to name a few. AI is rapidly evolving, and new threats are on the rise. โ€œMythosโ€ is a new development in AI that can cause great damage in hacking and cyber-attacks. Mythos is able to identify the vulnerabilities of systems making it thus for hackers a tool to identify the chinks in the chain and use it for their own gain. But what also about the changing trends of using technology in the first place? Younger generations such as Gen Z are favouring analogue technology and one sees a trend of people having the desire to go back to โ€˜physical mediaโ€™. Could this possibly have an influence on the future of cyber defence if individuals are favouring not to use technology?

With this in mind, can Europe for instance develop a certain AI cyber strategy (favouring the offensive active side) and continue to ensure the safety of all sectors? How do individual needs and trends fit into this? 

The development of an AI cyber strategy?

Researchers (e.g. Myriam Dunn Cavelty, Wilhelm Vosse) are talking more about Active Cyber Defence (ACD). Meaning there is a shift in cyber strategy that it is no longer solemnly about Cyber Defence (CD) but also proactively taking steps and measurements to prevent attacks from happening in the first place. However as early as 2017, scholars such as Scott Jasper already encouraged an automated cyber defence in order to halt attacks before they can even begin to cause damage. The recent G7 summit has taken place in ร‰vian, also hosted for the first time CEOโ€™s from :Open AI, Google DeepMind and Anthropic. This shows how strongly at the moment states combine their strategy with industry innovation since both go hand in hand in terms of continuously developing a cyber-strategy or what we might see, an AI active cyber-strategy. The meeting called upon guidelines where the US should have a pivotal regulating role and avoiding chips manufactured by China. The dynamics become even more complex as conflicts and different situations amongst states influence the development of an AI cyber strategy and even push states to regulating access to certain systems. Anthropic has released the statement: โ€œThe US government, citing national security authorities, has issued an export control directive to suspend all access to Fable 5 and Mythos 5 by any foreign national, whether inside or outside the United States, including foreign national Anthropic employees.โ€ 

It seems that one is moving into the debate of how one can have a single state determine for us what is safe and what isnโ€™t whilst at the same time ensuring that individuals are regularly kept โ€˜up-to-dateโ€™ with latest possible malicious activities? Should we head towards a single regulating โ€˜bodyโ€™ that makes sure that our cyber domain is safe? Will we have more cyber laws and push people โ€˜livingโ€™ more in the cyber realm? It is a tandem of focusing on the macro and micro level whilst keeping up with the overall rapid (malicious) development of technology. Each country seems to share of course resources to develop a strategy against the rising threat of AI yet, still each state faces individual hurdles and challenges that makes a unified AI active cyber strategy difficult to consider. Germany for instance has now taken a step towards a more active cyber strategy whilst France has now put talent development at the top of their strategy preferring , the individual level when speaking from a sociological point of view. South Koreaโ€™s biggest issues remains North Koreaโ€™s cyber-attacks so their focus lies there. 

If we were to dive deeper into thinking about the methodology and taking the factors โ€œsocietyโ€ and โ€œindividualsโ€ into account, the development of an AI cyber strategy and the mere thought of states and countries continuing to โ€˜wage warโ€™ against each other in the cyber domain, becomes more complex. Max Weber for instance claims that one has to take the factor โ€œdisciplineโ€ into account when analysing war and societal changes. Weber states the following: โ€œThe kind of weapon has been the result and not the cause of discipline.โ€ So if we refer to cyber-attacks and hacking systems such as โ€œMythosโ€ indeed as โ€˜weaponsโ€™, then they are apparently the result of discipline and should be treated with great care. When we consider discipline, then one also has to take the individual person into account. In the following, hypothetical questions will be asked in order to allow future debates to take place regarding how generations are using technology, especially younger ones. Whilst a macro viewpoint is essential, a micro approach focusing strongly on the individuals is equally important.

Trends amongst younger generations in using technology

Perhaps the recent trend with young people using more old digital technology will be the solution to be safer? There even is an initiative or a so-called โ€œAI resistance movementโ€ with individuals wanting customised computers and technology that does not have any AI integrated. Looking at the creative sector, news stories talk about the trend of individuals (especially younger generations gen z) coming together to create physical mood boards from magazines, reading physical books at the library in groups or for instance having a hobby group where one is not allowed to open any technology device.

These questions are of course speculative and hypothetical and up for debate however, taking one step back and looking at the society through a different lens may open up new ways of thinking. What if the civilians start moving โ€˜backwardsโ€™ in the cyber world? What if one develops active cyber strategies but eventually, civilians might find it โ€˜saferโ€™ to avoid said technologies in the first place? Perhaps individuals will go back completely to using flip phones with no access to AI or prefer having a physical magazine or book instead of exposing their data to algorithms that suggest them reading lists. Some researchers (Anurushmitha, J et al) even suggest that younger generations are less prepared for malicious cyber attacks due to being โ€˜over-confidentโ€™ with technology. So in this regard, it would be interesting for future research to keep analysing how generations are interacting with emerging technologies and whether one sees a decline in the use of advanced technology or a growing confident secure way.

Unsplash: Photo by Curology on Unsplash

As of this moment it seems like patchwork: one is running to catch up with the emerging problems that AI causes. For example, artists were very much against AI (in 2022) because they wanted to protect their art and copyright. An overall AI cyber strategy for Europe would entail a strategy that goes through all niches and little โ€˜cracksโ€™ in our society, not only pure defence of military capabilities. The strategy needs to protect critical infrastructure as well as go through our society and directly entail individualโ€™s needs. Scholars such as Henschaw also argue in favour of focusing on the human factor when developing a cyber strategy.

However, one also needs to consider, humans want to act first which is much discussed in disciplines of psychology and sociology. Consultants also can have an interesting take on this matter when one tries to apply for instance Stephen R Coveyโ€™s methods. Covey points out when discussing his 7 habits, that โ€œIn addition to self-awareness, imagination, and conscience, it is the fourth human endowment -- independent will โ€“ that really makes effective self-management possible (โ€ฆ) It is the ability to act rather than to be acted upon, to proactively carry out the program we have developed through the other three endowments.โ€ These questions and concerns show, that the field of analysing cyber issues very much correlates with human interactions which is also highlighted by scholars such as Cavelty et al:  โ€œOverreliance on quantitative data could result in technically sound but inadequately human-centred policies that fail to address underlying societal concerns.โ€ 

Concluding thoughts and open questions

Can the EU develop one comprehensive AI cyber strategy to combat malicious AI cyber-attacks from the outside? As of this moment, each EU country regularly releases its own (active) cyber defence strategy and also puts emphasis on its own needs, making therefore an EU AI cyber strategy as of this moment a challenging task. It would be interesting to conduct field research on how younger generations are acting with analogue technology and whether they would truly prefer a space with less AI and advanced technology. The Art of War by Zhang Yu states: โ€œAdaptions means not clinging to fixed methods, but changing appropriately according to events, acting as is suitable.โ€ 


References:

Alexis Henshaw, Anwar Mhajne, Beyond the Basics: Critical Perspectives on Cybersecurity in International Relations,ย Global Studies Quarterly, Volume 5, Issue 3, July 2025, ksaf067,ย https://doi.org/10.1093/isagsq/ksaf067

Anurushmitha, J., Nikhitha, D. and Pramod, J.P. (2026) โ€˜Cyber Security Awareness Among GenZโ€™, International Journal of Scientific Research and Technology, 3(3), pp. 159โ€“167.ย 

https://doi.org/10.5281/zenodo.18928049.

Covey, S.R. (1989) The 7 Habits of Highly Effective People. First Fireside Edition.

Dunn Cavelty, M., Pulver, T. and Smeets, M. (2024) โ€˜The Evolution of Cyberconflict Studiesโ€™, International Affairs, 100(6), pp. 2317โ€“2339. https://doi.org/10.1093/ia/iiae175.

Gerth, H.H. and Mills, C. Wright (1947) From Max Weber: Essays in Sociology. Kegan Paul, Trench, Trubner & Co., Ltd.

Henshaw, A. and Mhajne, A. (2025) โ€˜Beyond the Basics: Critical Perspectives on Cybersecurity in International Relationsโ€™, Global Studies Quarterly, 5(3), ksaf067. https://doi.org/10.1093/isagsq/ksaf067.

Myriam Dunn Cavelty, Tobias Pulver, Max Smeets, The evolution of cyberconflict studies, International Affairs, Volume 100, Issue 6, November 2024, Pages 2317โ€“2339, https://doi.org/10.1093/ia/iiae175, pg:2338

Stephen R Covey, โ€œthe 7 Habits of Highly Effective Peopleโ€ First Fireside Edition, 1989, pg 147-148

Sun Tzu (2003) The Art of War: Complete Texts and Commentaries. Translated by Thomas Cleary. Shambhala, Boston and London.

Anthropic (2026) Fable Mythos access. Available at: https://www.anthropic.com/news/fable-mythos-access (Accessed: 13 June 2026).

CNBC (2026) Anthropic, Amodei, Google, Hassabis: US AI coalition G7. Available at: https://www.cnbc.com/2026/06/17/anthropic-amodei-google-hassabis-us-ai-coalition-g7.html (Accessed: 20 June 2026).

Cyble (2026) France national cybersecurity strategy 2026. Available at: https://cyble.com/blog/france-national-cybersecurity-strategy-2026/ (Accessed: 12 June 2026).

Digital Strategy โ€“ European Commission (n.d.) European approach to artificial intelligence. Available at: https://digital-strategy.ec.europa.eu/en/policies/european-approach-artificial-intelligence (Accessed: 1 June 2026).

DIG Watch (2026) Germany approves draft law expanding cyber defense powers for federal authorities. Available at: https://dig.watch/updates/germany-approves-draft-law-expanding-cyber-defense-powers-for-federal-authorities (Accessed: 1 June 2026).

Euronews (2026) Wars, tariffs and AI: what to expect from the G7 summit in Evian. Available at: https://www.euronews.com/my-europe/2026/06/14/wars-tariffs-and-ai-what-to-expect-from-the-g7-summit-in-evian (Accessed: 14 June 2026).

ITSS Verona (2026) AI, ICT infrastructures, and social media in todayโ€™s conflicts. Available at: https://www.itssverona.it/ai-ict-infrastructures-and-social-media-in-todays-conflicts (Accessed:  20 March 2026).

June 23, 2026No Comments

The Chinese Strategy for Global AI Governance

By Giulia Saccone - AI, Cyberspace and Space Team

Whatโ€™s Chinaโ€™s AI policy? Rejuvenation of the nation through security and development

Generally, China is regarded as an innovative player in the AI race but an unlikely protagonist in the global governance dimension: this is given by its state-driven government, and AI national governance based on sovereigntyโ€‘first, securityโ€‘heavy, surveillanceโ€‘enabled principles. [1] However, the reconfiguration of the international order, and the US withdrawal from UN-based institutions provide China the occasion to promote an image of a responsible leader in the field of AI governance, pursuing a strategy grounded on the values of inclusion and fairness, with Chinese characteristics. 

This input is based on its foundational goals: economic growth and security, as stated in the 2017ย Next Generation Artificial Intelligence Development Plan. For the former, AI can be used as a propeller for the rejuvenation of the nation: the aim of restoring national wealth and power under the guidance of the CCP.ย ย Regarding the latter, AI-generated content presents a risk of jeopardizing social stability, hence political and national security.ย [2]ย Therefore, China has to leverage the international stage: it has to ensure that the current institutions that foster growth and security are upheld and promote policies that enable innovation and the activity of Chinese stakeholders, amid the US containment or the EU decoupling strategy and the criticism on its human rights policy. This reflects China's attempt to position itself as an alternative to US and European approaches to AI governance.

The impact of Chinese AI policy on the international stage: international competition trough norm setting and equipment export

In order to achieve development and ensure security, while hedging criticism and achieving strategic parity with the US, China has pursued a strategy aimed at projecting the image of a committed major player, capable of ensuring an equitable AI development for the Global South. This is enacted by the 2025 Global AI Governance Action Plan (GAIGI), which creates a strategy focused on UN-based multilateralism, human-centered AI, laws and consensus-based development of AI governance and respect for countriesโ€™ sovereignty. 

This latter value in particular is a concept developed based on the Five Principles of Peaceful Coexistence, [3]used by China as a counterargument towards international criticism over its human rights policies. The other element that we should specify is the commitment under the UN-based multilateralism: in the GAIGI institutions like the UN should be a starting point for consultations on soft laws that countries can then adopt and adapt into their national law, as corroborated by Beijingโ€™s endorsement of UN Secretary-General Antonio Guterresโ€™s proposal to create a new international body to govern AI under the UN framework. [4]

The commitment towards human-centered AI has to be understood as the objective of creating an AI development that involves all layers of the population, as corroborated by its statement in the UN Human Rights Council regarding the protection of the rights of specific vulnerable groups from AI-related harms. Moreover, UNESCO has been the most fertile ground for Beijingโ€™s AI diplomatic activities, also due to the US withdrawal from 2017 to 2022 and its forthcoming second exit in December 2026. There, China has financed the Beijing Consensus on AI and Education, implemented through the International Forum on AI and the Futures of Education and its contributions to the Recommendation on the Ethics of Artificial Intelligence. This first global ethical framework to foster the role of AI in achieving the UN Sustainable Development Goals. 
Other fertile grounds are the standard development organizations, like the International Telecommunications Union and the Institute of Electrical and Electronics Engineers, which are leveraged for creating standards favorable to Beijingโ€™s trade stakeholders and investors in their trade portfolios. [5]

The GAIGI is complemented by the AI Safety Governance Framework: a set of guidelines on the classification of AI safety risks and for the development and application for stakeholders. Another supporting policy is the 2023 Global Data Security Initiative, which projects the image of a responsible player, addressing the primary engine of AI, and aims at fostering an environment committed to data security and espionage by other countries, and responsible use for innovation and e-commerce.
The significance of these documents resides in the fact that they are among the few to be available in English, hence targeted for foreign audiences to stimulate the necessary consensus-building in the field and to counter accusations of espionage. [6]

Beijingโ€™s objective of achieving a whole-of-society development is enacted by the 2024 AI Capacity-Building Action Plan for Good and for All, along with its flagship programs, the Belt and Road initiatives (BRI) and Digital Silk Road (DSR). These programs aim at creating infrastructure connectivity and personnel training to bridge the โ€œintelligence gapโ€, while functioning also as vectors for Tencent, Alibaba and other stakeholders' investments, aimed at securing technology lock-ins, promoting the mutual recognition of tech standards, and integrating Chinese technology into foreign markets.[7]

So far, these plans have found fertile ground in the Middle East, Africa and especially among South Asian countries, while encountering skepticism in Latin America. [8] Nonetheless, the Global South functions as the ideal recipient thanks to Chinaโ€™s self-positioning in the middle ground between technological superpower and developing nation, [9] allowing a rhetoric that frames it as an enabler of the Global South development. This allows the region to become the solution for Beijingโ€™s crisis of internal demand due to its large pool of new customers, and as an opportunity to acquire embargoed chips, as happened with Nvidia products. [10]

Hedging the oppositions

Nevertheless, the strategy is not free from criticism due to Chinaโ€™s state-centric approach to AI governance, which leads to breaches in human rights that Western actorsย like the USย and theย EU regardย as unacceptable and incompatible with their own agendas.ย On the Sino-American relations, this factor is coupled with a strategic competition in emerging technologies, which has led toย interdependenciesย andย mutual strategic vulnerabilities.ย 

China has opposed this situation, challenging its technological hegemony and the American-centric global order with a confrontational rhetoric, especially in the field of semiconductors.ย [11]ย At the practical level, this is coupled with activities in the UN fora, the GAIGI and the Capacity Building Action Plan, enabling the creation of alternative pathways of supply chain, economic exports and pools of data from the Global South to equip and create Chinaโ€™s AI models. Therefore, this strategy aims at creating a virtuous cycle, an alternative to the US circuit, involving other international actors. These issues have gained sufficient prominence to feature among the key topics discussed during the Xi-Trump summitย of May 2026, which, however, have seen onlyย timid developments.

Photo by Christian Feng on Unsplash

The criticism of Chinaโ€™s human rights policy (whether in the digital field or not) is especially upheld by the EU and its 27 member states. Furthermore, Brussels has manifested the intention of achieving strategic autonomy through the Chips and AI acts, which have resulted in its recent proposal of curbing the ties with China in the digital technology field due to security concerns. 

 The EU is an important factor in Chinaโ€™s global AI governance strategy due to its role as a rule-maker: its ability to set trade and technology standards can affect relations with Chinaโ€™s third-largest trade partner. However, in this case, Beijing is pursuing an ambivalent strategy, characterized by an emphasis on shared commitments to human rights and development, [12] while threatening retaliation against measures deemed discriminatory. The strategy targets the EU's core commitment to human rights while leveraging considerable trade relations to retain the EU Member Statesโ€™ engagement, demonstrating alignment while simultaneously seeking alternative support on the global stage.

What future is China envisaging for AI governance? 

ย China is attempting to extend its role from innovator to driver of the discourse over international AI governance, trying to take the space left by the US in traditional institutions, leveraging its self-positioning as a middle ground between a technological powerhouse and a member of the Global South. China has sought to position itself as a supporter of an inclusive approach grounded in human rights. This strategy is grounded in its need to balance the US in the AI strategic competition and EU strategic autonomy, while not burning the Sino-European relations entirely, and expanding its outreach in the field to third actors.ย 

Therefore, China is trying to transpose its ultimate goals of rejuvenation of the nation through economic development and protection of the state and political security on the international stage with a series of capacity-building initiatives, projecting an image of a committed actor through international institutions. It is in its perception of the former, and in its value of respecting โ€œevery countryโ€™s national contextโ€ that resides its desired capability of achieving the security goal: international fora are seen as a flexible institution for finding common grounds, but refrain from imposing legally binding rules, and Beijingโ€™s commitment to respect all actorsโ€™ internal situations attempts to establish a logic for which national policies are free from international scrutiny. 


[1] Hung, Ho Ting. โ€œExploring Chinaโ€™s Cyber Sovereignty Concept and Artificial Intelligence Governance Model: A Machine Learning Approach.โ€ Journal of Computational Social Science 8, no. 1 (2025): 24. https://doi.org/10.1007/s42001-024-00346-8.

Zeng, Jinghan. โ€œArtificial Intelligence and Chinaโ€™s Authoritarian Governance.โ€ International Affairs 96, no. 6 (2020): 1441โ€“59. https://doi.org/10.1093/ia/iiaa172.

[2] Guangyu, Qiao-Franco, and Annelotte van Beek. Chinaโ€™s Strategy for Global  AI Governance. 2025; Leiden Asia Center, n.d. https://www.google.com/url?sa=t&source=web&rct=j&opi=89978449&url=https://leidenasiacentre.nl/wp-content/uploads/2025/12/25-04-01-Chinas-Strategy-for-Global-AI-Governance.pdf&ved=2ahUKEwii1ZjFh4qVAxXi87sIHezbI64QFnoECBkQAQ&usg=AOvVaw0ZeNimOwwE_GdMh6NEZ5EF.

[3] Dunford, Michael, and Weidong Liu. โ€œChinaโ€™s Evolving International Economic Engagement: China Threat or a New Pole in an Equitable Multipolar World Order?โ€ Area Development and Policy 9, no. 2 (2024): 131โ€“68. https://doi.org/10.1080/23792949.2023.2225092.

[4] Guangyu and van Beek (2025)

[5] Guangyu and van Beek (2025)

[6] Ibidem

[7] Ibidem

[8] Zhao, Hengfeng. โ€œNavigating Chinaโ€™s Multi-Track Strategy in Global AI Governance.โ€ Geopolitics of AI Governance, 2026. https://www.google.com/url?sa=t&source=web&rct=j&opi=89978449&url=https://www.sdu.dk/en/forskning/forskningsenheder/samf/cws/cws-activities/2026/geopolitics-of-ai-governance&ved=2ahUKEwiaw_fyjoqVAxXH8bsIHe5lBcQQFnoECBkQAQ&usg=AOvVaw2LBTKzUyEX8JwoNYYNKuoJ.

[9] Dunford, Michael, and Weidong Liu. โ€œChinaโ€™s Evolving International Economic Engagement: China Threat or a New Pole in an Equitable Multipolar World Order?โ€ Area Development and Policy 9, no. 2 (2024): 131โ€“68. https://doi.org/10.1080/23792949.2023.2225092.

[10]  Guangyu and van Beek (2025)

[11] Zhao, 2026

[12] Woon, Chih Yuan. โ€œNarrating Chinese AI Geopolitical Tradition.โ€ Geography Compass 20, no. 1 (2026): e70062. https://doi.org/10.1111/gec3.70062.

June 15, 2026No Comments

Extortion and the Crisis of Small Business Security in Peru

By Giovanni Giacalone - Central & South America Team

In recent years, Peru has experienced a dramatic increase in extortion targeting small and medium-sized business owners, transport operators, market vendors, construction contractors, and informal entrepreneurs. What had long existed as localized criminal racketeering has evolved into a broader system of organized extortion linked to transnational criminal groups, weakened institutions, prison-based networks, and the rapid expansion of urban insecurity. The phenomenon has become one of the central public security concerns in Peru, particularly in Lima and northern coastal cities.

The perpetrators seek to extract regular payments, commonly known as cupos, from businesses in exchange for โ€œprotection,โ€ meaning immunity from violence carried out by the extortionists themselves. Extortion has spread across transportation companies, mototaxi associations, neighborhood stores, restaurants, construction sites, nightclubs, and even schools. Media reports and police investigations indicate that refusal to pay often results in shootings, grenade attacks, arson, or targeted killings.

A major factor in this transformation has been the expansion of the Venezuelan-origin criminal network known as theย Tren de Araguaย into Peru. According to investigations by the Peruvian National Police (PNP) and reporting byย La Repรบblica, factions associated with the group, including โ€œLos Gallegos,โ€ โ€œDinastรญa Alayรณn,โ€ and โ€œLos Injertos de Aragua,โ€ have established extortion operations in Lima, Callao, Trujillo, and other urban areas. Primary sources from the Peruvian state also confirmed the scale of the problem. While the expansion of Tren de Aragua has contributed to the growth and sophistication of extortion networks in Peru, the problem itself is not new. Extortion long predates the group's arrival and is closely linked to broader issues such as urban insecurity, economic informality, and limited state presence in some communities.

One of the sectors most affected has been urban transportation. Bus companies and informal transport associations in Lima and Callao have reported systematic threats demanding daily or weekly payments. According to La Repรบblica, members of โ€œLos Injertos de Araguaโ€ extorted public transportation firms through digital payment systems such as Yape, allowing criminals to collect payments anonymously while reducing physical exposure. The use of fintech applications illustrates how extortion practices have modernized technologically alongside Peruโ€™s expanding informal digital economy.

Data published by Gestiรณn, citing the Peruvian Attorney Generalโ€™s Officeโ€™s Crime Observatory, documented at least 125 attacks related to extortion in Lima and Callaoโ€™s transportation sector between August 2024 and December 2025. The report noted that most victims were drivers, followed by passengers and fare collectors. This demonstrates that extortion has evolved beyond isolated threats into sustained systems of coercion affecting entire economic sectors.

Peruvian media coverage also highlights the psychological dimension of extortion. Victims frequently receive WhatsApp messages containing videos of firearms, photographs of family members, or recordings of previous murders. In one reported case involving a transportation entrepreneur in San Martรญn de Porres, criminals demanded 10,000 soles per month and threatened to โ€œblow upโ€ the victimโ€™s house if payments stopped. The combination of digital intimidation and spectacular violence creates a climate of fear that discourages denunciation and weakens public trust in authorities.

Another important feature of the phenomenon is its relationship with Peruโ€™s informal economy. A large proportion of Peruvian small businesses operate with limited legal protection, precarious access to banking, and minimal police presence. Extortion networks exploit these vulnerabilities. Informal transport operators, street vendors, and neighborhood businesses often lack insurance, legal representation, or the resources necessary to resist criminal pressure. In many districts, extortion effectively becomes an unofficial tax imposed by armed actors.

The testimonies of some of the extortion victims, who asked to remain anonymous, provide a rather clear modus operandi on the part of these criminal groups:

A 34-year-old dance teacher from central Lima told us that her business had been thriving until she began receiving disturbing WhatsApp messages demanding large sums of money in exchange for being allowed to continue operating safely. The messages included threats against her and her family, along with photos of places she frequently visited. One day, a funeral wreath was delivered to her apartment. That was the moment she decided to close her business and move abroad.

Another former business owner had to close his restaurant in Trujillo as it had become impossible for him to even reach the end of the month as the gang planning to extort him wanted all of his monthly income. Eventually, he moved to another area of โ€‹โ€‹the country and then abroad.

In some cases, the individuals involved in the extortion rings are as young as twelve, as explained by the Peruvian police and reported by Infobae in May 2026:

โ€œCriminal organizations have begun recruiting even younger children for serious crimes in Callao. General Espinoza detailed that there have been โ€œseveral casesโ€ of 12-year-old children armed and participating as hitmen or extortionists.โ€

Scholars and journalists have noted that Peruโ€™s extortion crisis differs from earlier forms of criminal taxation seen during the internal conflict of the 1980s and 1990s. Contemporary extortion networks are decentralized, entrepreneurial, and highly adaptive. Rather than operating through ideological insurgency, they function through flexible criminal markets. Investigative reporting in El Comercio revealed how some organizations linked to the Tren de Aragua combined extortion with shell companies and international money transfers, indicating increasing financial sophistication.

Photo by Tima Miroshnichenko, pexels.com.

For instance, on April 19, 2026, the National Police of Peru (PNP) managed to dismantle the criminal gang โ€œBunker Gota Colombo,โ€ dedicated to extortion, inside its center of operations located in the southern Lima district of Villa El Salvador.

The detainees, eight foreign nationals and one Peruvian citizen, are being investigated for the alleged crimes of illegal manufacture and possession of firearms, as well as aggravated extortion linked to predatory lending practices. During the searches, authorities seized four sticks of dynamite allegedly used to intimidate victims. Officers also confiscated 33 cell phones, seven notebooks containing detailed records of loans and collections, 13 motorcycles, and one car.

The operation began following a complaint filed by a woman living in Villa El Salvador, who reported receiving constant threats demanding that she make payments through a digital wallet.

The consequences for Peruโ€™s economy and civil society are substantial. Extortion increases operating costs for small businesses, discourages entrepreneurship, reduces investment in vulnerable neighborhoods, and reinforces informality. For many entrepreneurs, paying cupos becomes normalized as a cost of survival. In some cases, business owners close operations entirely or migrate internally to avoid threats. The burden falls disproportionately on lower-income Peruvians whose livelihoods depend on small-scale commerce.

Ultimately, the recent extortion phenomenon in Peru reveals a broader crisis of governance and the institutional capability to provide efficient urban security. The expansion of criminal organizations, the weakness of institutional enforcement, the growth of informal labor markets, and the technological adaptation of extortion practices have combined to create an environment in which violence becomes economically rational for criminal actors. As long as state legitimacy remains fragile and economic precarity widespread, extortion is likely to remain one of the defining challenges facing Peruvian society and for law enforcement.

June 13, 2026No Comments

How Russia is Reportedly Replacing Spies with Criminals in the UKย 

By Isabella Sutherland - Military Strategy & Intelligence Team

Over one hundred and fifty arson and explosive plots across Europe have been linked to Russia between February 2022 and Februry 2026, and very few carried out by Russian nationals [1]. Since Russia's full-scale invasion of Ukraine in February 2022, Western security services have documented a sharp increase in Russian intelligence operations conducted through criminal proxies, disposable agents, and deniable intermediaries. R v Roussev & Others and R v Dylan Earl & Others together demonstrate that traditional UK counter-espionage frameworks were not designed to address remotely directed intelligence networks and task-based criminal operatives. 

Available evidence suggests that Russiaโ€™s accelerated use of criminal proxies in the UK is enabled by multiple interacting factors, including  the structural degradation of professional HUMINT capacity through mass coordinated diplomatic expulsions; depletion of Russian intelligence in Ukraine; the ideological contrast from Cold War-style long-term communist recruitment with Putinโ€™s Russia, and the technological infrastructure which has made remote proxy control operationally viable at scale. The 2022 invasion was an accelerant rather than the origin of a new tradecraft. 

Double Depletion 

Russiaโ€™s professional HUMINT presence in the UK had begun to decline before 2022. The Salisbury poisoning triggered the expulsion of 23 Russian diplomats in 2018, the largest of its kind since the Cold War, removing a significant layer of embassy-based intelligence officers. Following the full-scale invasion in 2022, a coordinated Western response expelled over 700 Russian officials across more than 34 countries. The overwhelming majority were intelligence officers using diplomatic cover; this huge capacity cannot be quickly or easily replaced [2].

The Ukraine war introduced a compounding depletion. Russiaโ€™s intelligence services including the FSB, SVR, and GRU have been substantially redirected toward the war effort, consuming intelligence resources which could have otherwise been deployed in Western Europe [3]These combined factors made proxy substitution both preferable and increasingly attractive.  [al1] 

Why ideology cannot fill the gap

Two main enabling conditions explain why proxy actors seem to have become one of the main instruments of Russia in the UK instead of rebuilding its network of professional officers after the mass expulsions.

First is ideology. The Cold War model of espionage depended on Western recruits motivated by a genuine commitment to Soviet communism. Putinโ€™s modern statist nationalist anti-Western ideological framework may not hold the same appeal [4]. This is not a temporary gap, but a seemingly increasingly entrenched [al2] feature of post-Soviet Russia; money, coercion, and criminal leverage now substitute this void. 

Second is technology in the era of the โ€˜Gig Economyโ€™ defined by a free-market, predominantly online system where short-term positions common and organisations buy workers for temporary engagements [al3] [5]. Encrypted messaging platforms like Telegram, cryptocurrency payments, and remote tasking are central to this on-demand workforce. It creates the operational infrastructure for control over proxy actors without physical presence. Russian handlers direct the local actors anonymously through digital channels, making attribution difficult and the handler-agent relationship difficult to trace. Without this infrastructure, [al4] the expulsion of embassy-based officers would have significantly reduced Russian capability. 

The Hitman and the Arsonist

Six Bulgarian nationals, the so-called โ€˜Minions Ringโ€™, led by Orlin Roussev and directed through Russian intermediary and fugitive Wirecard executive Jan Marsalek, operated in a networked structured utilising fake passports in a layered principal-agent system. The group conducted semi-professional surveillance on journalists, politicians, and military facilities across the UK and Europe between 2020 and 2023, compiling reconnaissance on targets whom they planned to kidnap and kill.[al5]  The defendants were recruited and tasked over Telegram, motivated by reward sums of nearly โ‚ฌ1 million. No Russian nationals were directly involved in UK operations. This case demonstrates a structured operation purpose-built for intelligence collection and the closest contemporary example to traditional espionage. 

Photo by Viralyft from Pexels

The case of Dylan Earl takes a slightly different form. It was a task based, financially motivated operation with less sophistication. The 20 year old from Leicestershire with international criminal links was recruited on Telegram by a Wagner Group handler and tasked to organise arson attacks on London warehouses storing humanitarian aid and Starlink equipment for Ukraine, and to plan the kidnapping of a prominent Russia dissident. He recruited further assisting agents, none of whom had previously met, creating a layered principal-agent system in which the Russian connection was several steps removed from the physical act. The March 2024 arson caused over ยฃ1m damage. Earl and his co-defendant Jake Reeves became the first people convicted under the National Security Act 2023 for activity linked to a foreign state. This new legislation was explicitly designed to capture actors whose operations fall short of traditional espionage. Counter Terrorism Policing described this as a clear example of a Russian-state linked organisation using British proxies to carry out serious criminal activity on its behalf [6]

Frameworks need fixing

These cases reveal a core tradecraft shift to the absence of Russian nationals physically present in UK operations. No professional intelligence officers; no embassy infrastructure; no ideological commitment. 

The National Security Act 2023 represents a genuine institutional acknowledgement of this shift. By extending criminal liability to actors who assist foreign states without formal intelligence roles, it closes a significant legislative gap posed by the proxy model. However, prosecution after the fact is not the same as disrupting recruitment further up the chain. Traditional counter-espionage frameworks built around identifying and expelling professional officers are necessary but no longer sufficient alone. The UK must engage with digital platforms and financial infrastructure through which proxy recruitment operates and pursue closer cooperation with the private sector, especially at a time when transatlantic intelligence-sharing is under unprecedented strain. The Intelligence and Security Committeeโ€™s Russia Report 2020 warned that the UK had failed to fully assess the scope of Russian interference, prosecutions since the full-scale invasion suggest that this assessment remains incomplete [7]

Russiaโ€™s shift towards criminal proxies is not a temporary adaptation to temporary Western pressure, but the path of least resistance to modernising effective tradecraft. It is a structural response to an irreplaceable HUMINT deficit, a post-ideological recruitment environment, and a digital infrastructure purpose-built for deniable covert action. With the escalation of the Ukraine war, comes the parallel escalation of the โ€˜shadow warโ€™ which cannot be won by expelling diplomats alone. 


[1] Courthouse News Service. (2025, October 24). Men sentenced over London arson attack masterminded by Russia as part of a wider sabotage campaign. Men sentenced over London arson attack masterminded by Russia as part of a wider sabotage campaign | Courthouse News Service

[2] Riehle, K. P. (2024). Soviet and Russian Diplomatic Expulsions: How Many and Why? International Journal of Intelligence and CounterIntelligence37(4), 1238โ€“1263. https://doi.org/10.1080/08850607.2023.2272216

[3] Congressional Research Service. (2025). Russiaโ€™s foreign intelligence services (IF12865). Congress.gov. Russiaโ€™s Foreign Intelligence Services | Congress.gov | Library of Congress

[4] Snegovaya, M., & McGlynn, J. (2025). Dissecting Putinโ€™s regime ideology. Post-Soviet Affairs41(1), 42โ€“63. https://doi.org/10.1080/1060586X.2024.2386838

[5] Richterova, D., Grossfeld, E., Long, M. & Bury, P. (2024). Russian Sabotage in the Gig-Economy Era. The RUSI Journal, 169(5), 10โ€“21. Full article: Russian Sabotage in the Gig-Economy Era

[6] Counter Terrorism Policing. (2025, October 28). Men jailed for London warehouse arson. Counter Terror Business. Men who organised Russia-backed arson at London warehouse jailed | Counter Terrorism Policing

[7]ย Intelligence & Security Committee of Parliament. (2020).ย Russiaย (HC 632). Her Majestyโ€™s Stationery Office.ย HC 632 โ€“ Intelligence and Security Committee of Parliament โ€“ Russia

June 4, 2026No Comments

The Strategic Logic of China’s April 2026 Supply Chain Regulations

By Sandra Watson Parcels - China & Asia Team

The April 2026 Chinese State Council regulations on industrial and supply chain security introduce a compliance trap with no clean exit. Foreign companies operating in both Western and Chinese markets now face a structural dilemma: complying with Western export controls or sanctions may qualify as grounds for designation and penalty under Chinese law, while failing to comply risks Western penalties. This is not an incidental feature of the regulations. It is their strategic function. The regulations comprise two instruments, the Provisions on the Security of Industrial and Supply Chains and the Provisions on Countering Improper Extraterritorial Jurisdiction by Foreign States, and expand the capacity to investigate, restrict, and penalise foreign companies and governments accordingly. They are the latest iteration of a framework treating economic interdependence as an instrument of state power, one that has grown more institutionalised and operationally precise over time.

The Expanding Toolkit

China has built a set of interwoven economic pressure tools over the past several years. The April 2025 licensing controls on seven medium and heavy rare earth elements (samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium) established Beijing's capacity to restrict access to materials where it controls over 80 percent of global processing capacity. While some extraterritorial features of later 2025 measures were suspended until November 2026, the core licensing framework remains active. The April 2026 supply chain security regulations extend this framework. The Provisions on Security of Industrial and Supply Chains permit Chinese authorities to designate foreign entities as threats to industrial security and impose escalating responses including trade restrictions, investment blocks, and visa limitations. The criteria for designation are extensive and include acts as routine as complying with foreign export controls or sanctions.

The counter-extraterritorial provisions operationalise this trap. The Provisions on Countering Improper Extraterritorial Jurisdiction give Chinese authorities broad discretion to penalise companies that comply with foreign controls, without requiring proof of intent. Complying with European Union (EU) or United States (US) rules is sufficient grounds for designation. The practical consequences are hesitation, delayed investment decisions, and in some cases withdrawal from market positions that would otherwise support allied supply chain goals. The legal framework does not require companies to choose China. It requires them to avoid choosing against it. 

Strategic Patterns and Objectives

This approach follows patterns established in earlier measures where Beijing arranged economic instruments in response to actions it opposed, whether on Taiwan, technology security, or alliance coordination. The consistent objective has been to encourage restraint among governments and self-censorship among firms without crossing into armed conflict. The G7 trade ministers addressed this in their May 2026 statement from Paris, expressing concern about economic coercion through export restrictions that risk supply chain disruptions, particularly for critical minerals, and undermine economic security and resilience. That G7 trade ministers felt compelled to address this directly in a formal communiquรฉ reflects how far the issue has moved from technical trade policy into the domain of security strategy. Western policy frameworks have yet to fully institutionalise that shift. The strategic logic is to slow or complicate moves toward supply-chain independence in sectors including defence, electric vehicles, renewables, and advanced manufacturing. By concentrating leverage at processing chokepoints rather than raw material extraction alone, the approach creates costs that are asymmetric and difficult for individual states to absorb unilaterally.

Implications for Europe and Allied Partners

European states, including Italy, face direct exposure. Many industries remain dependent on Chinese processing capacity for critical minerals used in batteries, defence systems, and green technology. European defence procurement in particular relies on rare earth elements for guidance systems, radar, and propulsion technologies where alternative processing capacity outside China remains limited. The April 2026 regulations mean companies with exposure in both markets now face that compliance trap directly. The compliance trap does not affect companies in isolation. When one state faces economic pressure, others frequently hesitate to act in solidarity, which deepens instead of eases vulnerability. This fragmentation is what the regulatory framework exploits. But fragmentation is not inevitable. It reflects political incentives that individual states have so far been unwilling to override. Understanding why collective hesitation persists matters as much as documenting it.

North America illustrates both the exposure and the gap. American companies operating in China that comply with US forced labour due diligence or technology transfer requirements now risk designation under the new regulations. What a compliance officer treats as routine legal obligation, Chinese authorities may treat as a qualifying act. Canada's experiencefollowing the Meng Wanzhou arrest demonstrated how targeted pressure can leave a middle power with limited unilateral options, and the broader pattern holds: collective resistance breaks down as individual states calculate that bilateral accommodation is less costly than holding a common line. For middle powers, the compliance trap is easier to navigate collectively than alone. Canada's positioning on critical minerals compounds this. The advantage cited in recent policy discussions rests on extraction capacity, not processing capacity. Canada extracts. Others process. That is the specific gap the current regulatory leverage exploits.

Photo by CHUTTERSNAP on Unsplash

Policy Considerations

Addressing this challenge requires treating economic coercion as structural, not periodic trade friction. Generic diversification language understates what that requires. Public investment should target processing capacity in allied jurisdictions directly, since extraction diversification alone does not address the chokepoint through which current leverage operates. For the G7 and EU, this means jointly funding processing infrastructure rather than leaving it to market incentives that have so far failed to close the gap. Within NATO, early warning and coordinated response mechanisms for economic coercion deserve the same institutional attention currently given to cyber threats. For companies, resilience planning should map exposure at the processing stage specifically, not just at the extraction or finished goods level, since that is where the compliance trap bites hardest. Due diligence frameworks and open market arrangements among allied and partner states would reduce the dilemmas companies currently face, but only if governments provide clarity on which compliance obligations take precedence and under what conditions. The compliance trap is a legal design. Dismantling it requires a legal and institutional response, not only a supply chain one.

Concluding Assessment

The April 2026 regulations add legal precision and institutional reach to a framework that has been developing for several years. The compliance trap they formalise is not a byproduct of competing regulatory systems. It is a structural feature designed to raise the cost of coordinated responses while remaining below the threshold of direct confrontation. The chokepoint is processing, not extraction, and current Western policy responses have not consistently targeted it. Treating these instruments with the same analytical seriousness as military or cyber threats is warranted, not because the risks are equivalent, but because the effects on industrial capacity, alliance cohesion, and strategic autonomy are consequential and harder to reverse. The vulnerabilities are understood. The processing gap is specific enough to act on. The question is whether policy follows analysis.

June 2, 2026No Comments

KFOR MSU Securing the Ibar Bridgeย 

By Geraldina Botter - Italy Team

Since 2012, Italian Carabinieri of the KFOR Multinational Specialised Unit (MSU) have patrolled the Austerlitz Bridge in Mitrovica, twenty-four hours a day. Twenty-seven years after the Kosovo War and nearly two decades into Kosovo's declaration of independence, the bridge remains the sharpest measure of how far EU-facilitated dialogue has come, and how far it still has to go[1]

ย The Austerlitz Bridge as a measure of impasse

Officially known as the New Bridge, a hundred-meter steel structure crossing the Ibar River was originally conceived to connect the two sides of Mitrovica. Following the conflict, French KFOR forces invested nearly โ‚ฌ1.5 million in its reconstruction as part of post-war stabilisation efforts. "Austerlitz", recalling Napoleon's decisive victory over Austro-Russian forces, proved an evocative designation: far from being an infrastructure, the bridge became a geopolitical boundary, embodying the unresolved disputes over sovereignty, governance, and identity that continue to define Kosovo's post-conflict impasse.

The Mitrovica partition runs deeper than the water. Formalized into two distinct municipalities in 2013 under the Brussels Agreement, Ethnic Serbs populate the northern bank, while ethnic Albanians the southern. While the bridge remains open only to pedestrian crossings, many residents have not crossed it for more than 15 years[2]. Now viewed as a symbol of division, since 2012 it has been patrolled 24/7 by Italian Carabinieri from KFOR-MSU to maintain peace and stability in the area and to deter illegal activities.

In the immediate aftermath of the conflict, French KFOR troops established a military checkpoint on the bridge; recurring outbreaks of violence, spanning from the 2000 attacks and the 2004 riots to the 2011 barricade crisis and the 2017 wall demolition, consolidated its status as a recurrent flashpoint for interethnic confrontation. Over the years, it has repeatedly been barricaded, reopened, and politically contested through EU-mediated dialogue, calling for its "revitalisation". Yet, political stakes have sharpened with Pristinaโ€™s efforts to consolidate control in the north, deepening the community's sense of alienation and marginalisation. While the struggle continues, it stands as a symbol of the impasse, entrenching ethnic divisionsย beyond the spatial dimension, thereby underscoring the stagnation of the EU-facilitated dialogue between Belgrade and Pristina to this day.

Carabinieri hybrid model of Stability Policing

Spanning twenty-seven years of NATO's continuous presence, the Italian-led Multinational Specialised Unit has remained central within the mission's security architecture. Based in Pristina under the direct authority of the KFOR Commander (and currently led by Colonel Di Fiore), it is a highly specialized multinational unit of Italian Carabinieri, working alongside Czech Military Police and Moldovan soldiers. In accordance with UNSC 1244, its mandate is oriented towards guaranteeing a safe and secure environment (SASE) and freedom of movement (FOM) for all communities across Kosovo. Operating as a third responder alongside KFOR forces, MSU acts as a gendarmerie unit that blends military capabilities with a policing background. 

Defined as Stability Policing, the concept emerged from the Alliance's experience in Bosnia-Herzegovina in the late 1990s to fill the "security gap[3]" when local police forces are either absent, insufficient, or unable to perform their functions, while conventional military units remain ill-suited for public order and community-oriented tasks. In this sense, MSU was designed to fill that gap, combining deterrence capabilities with policing functions, institutional legitimacy with operational flexibility, and community proximity with response readiness.

Translated into 24/7 presence on both sides under Operation "Austerlitz", MSU aims to preserve stability through situational awareness activities, criminal intelligence gathering, and crowd and riot control.

Beyond the bridge itself, mirroring the mandate of SFOR, the unit conducts patrols throughout northern Kosovo, supports KFOR Tactical Reserve operations, performs military police functions, coordinates with EULEX, and contributes to the ongoing assessment of Kosovo Police self-sufficiency. Through training in CRC, CQB, and tactical reserve procedures, combined with joint exercises, Carabinieri exemplifies the broader evolution of Stability Policing at the intersection of deterrence, public order management, and institutional support.

Drawing on its long-standing tradition of territorial policing, public order management, and proximity-based security practices, the Carabinieri has gained a considerable degree of legitimacy in Kosovoโ€™s polarized environment, being perceived as impartial by both Kosovo Albanian and Kosovo Serb communities. In sharp contrast to other external security actors, this local trust holds a strategic value extending beyond tactical duties, proving that the management of interethnic tensions depends as much on legitimacy and local trust as on deterrence.

Image by oltreme from Pixabay

Conclusion 

From the Western Balkans to the Middle East, MSUโ€™s hybrid model has proven not only durable but exportable, filling a vacuum that conventional military deployments cannot provide and purely civilian missions cannot sustain. As a police force operating in post-conflict zones thousands of miles from home, their unusual blend of law-enforcement expertise and military capability provides a far more tailored response to todayโ€™s โ€œnot-quite-warsโ€.

Far from being an urban infrastructure, Austerlitz Bridge is a barometer of a political process still in motion, where Carabinieri presence remains one of the indicators of where normalisation actually stands. With Pristina's administrative consolidation, Belgrade's influence over Kosovo's Serb communities, and Trump's territorial solutions, northern Kosovo remains caught between competing pressures that military presence alone cannot resolve. Today, the โ€œbridge issueโ€ is in no way a matter of logistics; it is a struggle of competing symbols and perceptions that goes beyond spatial dimensions, where MSU holds that space open. 

Yet, deeper questions remain unaddressed. While the EU-facilitated dialogue advances slowly and intermittently, Russia's war in Ukraine redirects Alliance attention, reactivating anxieties about the vulnerability of Europe's periphery.  With the Ankara NATO Summit scheduled on 7โ€“8 July 2026, the question of the Alliance's long-term commitment to the Western Balkans demands a substantive answer. In the geopolitical vacuum of enlargement fatigue[4] and an eastward-shifted Alliance, Italy's enduring presence stands as a security provider for a community that is still shaping its own future.


[1] Baccini, F. (2025); Tra Pristina, Belgrado, UE e Trump. Nubi scure su Mitrovica. Osservatorio Balcani e Caucaso Transeuropa. Available at: https://www.balcanicaucaso.org/cp_article/tra-pristina-belgrado-ue-e-trump-nubi-scure-su-mitrovica/

[2] Elfversson, E., Gusic, I. and Meye, M-T., (2023); The bridge to violence: Mapping and understanding conflict-related violence in postwar Mitrovica. Journal of Peace Research, 61(4), pp.576โ€“594. doi:10.1177/00223433221147942. Available at: https://journals.sagepub.com/doi/full/10.1177/00223433221147942

[3] Tancon Lutteri, F. (2020). EUROGENDFOR: The Origins. European gendarmeries, from their origins to the European Gendarmerie Force. The CoESPU Magazine, (4), 14. https://www.coespu.org/index.php/articles/eurogendfor-origins

[4] Othonos, A. (2010). Why Has the European Union Not Been Able to Counter 'Enlargement Fatigue'?. Journal of Contemporary European Research6(1). https://www.jcer.net/index.php/jcer/article/view/124/192

May 18, 2026No Comments

Putin Hints at Ending Ukraine War, Can Russiaโ€™s Economy cope?

By Sorin Dojan - Russia Team

Russian President Vladimir Putin said on Saturday (9 May) that he thoughtย the war with Ukraine is โ€œcoming to an endโ€, more than four years after the start of Russiaโ€™s large-scale military campaign in Ukraine, which significantly altered European security dynamics and regional trade patterns.ย Three days later, Deputy Prime Minister Alexander Novak said the governmentย now forecasts GDP growth of 0.4% in 2026, significantly down from the 1.3% previously expected.ย 

For many looking at the latest string of data coming from the Kremlin, ending a four-year war that has driven consumer prices higher in the process sounds like the first hurdle in a series of challenges to overcome. These range from stubbornly persistent inflation and high interest rates to a militarised economy losing momentum and a shrinking GDP growth. Russia's economy entered recession in 2022, and the recovery that followed was uneven, marked by persistent declines in retail sales, sluggish income growth in some parts of the country, and regional budget constraints[1]

Amid the economic disruptions caused by sanctions, certain industries emerged to keep the economy afloat. But the winners that underpinned Russiaโ€™s economy during the war could suffer disproportionately from any future economic redress. The challenge for the regime will then be to find alternative paths to growth in a heavily sanctioned economy with limited export strings and partners.

What to do with the military industrial complex?

Following Russiaโ€™s invasion of Ukraine, the world witnessed a highly coordinated sanctions response, with the West collectively imposing almost 24,000 punitive measures against individuals, entities, vessels, and aircraft as of August 2025, according to Castellum.AI, an AI-powered agency specialising in Anti-Money Laundering (AML).

The Russian economic revival that emerged later was highly volatile and disproportionate, with weapons-producing regions among the warโ€™s economic winners, as evidenced by regional tax collection data. On the other hand, the regions mostly pressured were the ones bordering Ukraine, those specialising in ferrous metal production and places with industries heavily sanctioned by the West[2].

The Russian military-industrial complex operates differently from its American counterpart. Whereas the US defence industry relies heavily on private investment, Russian companies in this industry largely depend on state subsidies, making the government a major contributor to the military-industrial complex[3].

There is no doubt that Russia has overinvested in its military to boost production and growth, but above all to replace the hardware damaged in the war. In 2025, the defence sectorย absorbed 15.9 trillion roubles in 2025, or around 7.2% of the countryโ€™s revised GDP forecast for that year. For comparison, its close ally, China, spent around 1.7% of its GDP on the military,ย according to World Bank data, yet Beijing is not involved in a costly war forcing the state to implement extensive stabilisation measures.ย 

The question that then emerges is what happens to such government spending once the war comes to an end? 

One would be tempted to assume a return to the pre-2022 status quo, but that would depend on the West lifting sanctions and allowing Russiaโ€™s once-productive industries (particularly Europe-destined commodities) to resume humming at full speed. 

There is no guarantee of success. As recently as last week, European diplomats and officials cited by POLITICO said the bloc was getting ready to impose a fresh wave of sanctions, this time targeting Moscowโ€™s shadow fleet of ageing tankers. The EU is also eyeing the opportunity to impose sanctions that were previously opposed by ex-Hungarian Prime Minister Viktor Orban, including punitive measures against Patriarch Kirill and other members of the Russian Orthodox Church. French politician and Minister Delegate for Europe Benjamin Haddad said in April that it was not the time to lift sanctions on the Kremlin but rather โ€œstep up [โ€ฆ] pressureโ€, namely on the Russian energy sector.

For now, it is expected that Russia will maintain the same level of military investment to replenish military stockpiles and replace personnel lost on the battlefield[4]. Yet for how long that can be justified is subject to debate. As one Carnegie analyst put it: โ€œAny attempt to rapidly cut spending will result in collapse. But nor can the military machine be fed indefinitely.โ€

NVO, CC BY-SA 3.0 , via Wikimedia Commons

Defence investment is not necessarily conducive to a thriving economy. According to a RUSI study, defence expenditure plays little role in promoting economic growth; a European Commission report separately stated that โ€œit is impossible to determine if this tendency [to spend more on defence] is favourable or negative to growth.โ€

It is not hard to imagine why. The military-industrial complex is part of a command economy, largely detached from market forces that drive flexibility and a more efficient resource reallocation. At the macro level, such inflated expenditure is only justified in times of war[5].

In Russiaโ€™s case, being left with an overinflated military-industrial complex that serves as one of the few engines of growth is dangerous to its future economic recovery.ย Disinvest too soon and you might risk upsetting an overexpanded industrial workforce. But choosing to continue allocating resources toward military procurement rather than civilian economic activity is equally unproductive.

Either way, Putinโ€™s speech in early May signals more than just a willingness to pull out from a war that has cost the Kremlin thousands of lives. Instead, his remarks come against the backdrop of a Russian economy showing signs of โ€œstagflationโ€. The central bank interest rate stands at 14.5% as of April 2026, significantly higher than the rates in Western economies. Core inflation hovered at 6.3% in Q1 2026, up from 5% registered in the previous quarter. 

If Novakโ€™s statement serves any good in this context, it might be that it could force the Kremlin to give peace a genuine chance after four years of sustained military operations with significant economic and human consequences. At what cost could peace come for the national economy? It remains to be seen.


[1] Yuriy Gorodnichenko, Iikka Korhonen, and Elina Ribakova, War-Induced Economic Convergence in Russian Regions (Peterson Institute for International Economics, 2025).

[2] Andrey Yushkov and Michael Alexeev. โ€œRussian Regions in Wartime: Fiscal and Economic Effects of the Russo-Ukrainian War,โ€ Post-Soviet Affairs 40, no. 4 (2024): 313โ€“325. https://doi.org/10.1080/1060586X.2024.2355047.

[3] Gorodnichenko, Korhonen and Ribakova, War-Induced Economic Convergence, 6.

[4] Maria Snegovaya, Nicholas Fenton, Tina Dolbaia, and Max Bergmann, The Russian Wartime Economy: From Sugar High to Hangover(Center for Strategic and International Studies, 2025).

[5] Dmitry Gorenburg, Samuel Bendett, Ken Gause, Pavel Luzin, Gabriela Iveliz Rosa-Hernandez, Paul Schwartz, and Elizabeth Wishnick, Crafting the Russian War Economy: The Effects of Export Controls on Russiaโ€™s Defense Industrial Production (CNA Corporation, 2024).