Lord Mayor, good afternoon and indeed Lady Mayoress, lovely to see you both. Sheriffs, Aldermen, Ladies and Gentlemen. I'm delighted on behalf of William and not a little relieved, finally, to be able to honour the Lord Mayor's invitation to deliver his Defence and Security speech, an opportunity he first proposed nearly two years ago during that halcyon and seemingly historic period BC.
Well, here nearly a couple of years later, some of us more physically apparent than others in the hybrid spirit of these times, and William is still the Lord Mayor. Those of you familiar with some of his sporting habits will recognise this pattern and the emphasis on being Not Out. And of course in securing a follow-on innings, William enters the record books alongside Dick Whittington as I believe, one of only four Lord Mayors to have served a double-term or more. But he is not the first Lord Mayor to have summoned the Army Chief to the Mansion House.
That distinction I think belongs to one Brackley Kennett. We need to go back some 241 years to the summer of 1780. The 6th of June to be precise. The City that night was on fire, the Gordon Riots were at their most violent, businesses and homes were being ransacked and the gates of Newgate Prison had been breached, spilling their residents out onto streets of the City. Confronted by increasing anarchy on his doorstep, Kennett appealed to the Crown for some 'horse and foot' to quell the riot, to protect his Mansion House and the Bank of England. A detachment of the Brigade of Guards marched that night, up from Buckingham Palace, restored order and secured the Bank of England, the institution that would go on to provide the essential monetary stability to support a growing industrial nation; giving rise to what was known as the Bank Picquet, a platoon of Guardsmen who protected the Bank every night, marching up through the City before the gaslamps were lit. And somewhat amazingly this seemingly essential element of national fiscal security continued, without interruption until the 31st March 1973 when it was finally and completely suspended; the only change in over 240 years being that towards the end the detachment, they were occasionally wont to jump on the Tube if it was raining. The Lord Mayor may wish to note that Kennett's own reputation was rather shorter-lived. He was judged to have been complacent, convicted of criminal negligence and fined the then enormous sum of a thousand pounds.
So today we may not need the Brigade of Guards to protect the nation's gold reserves but the relationship between Defence, the country's economic health and security and a City that sits at the heart of a globally interconnected financial system remains just as important as it ever was. And perhaps in an age characterised by strategic volatility, even more so.
Because the experience of the Covid pandemic has exacerbated some underlying global morbidity and exposed some wider de-stabilising asymmetries. Not least we've all been reminded that Low Probability but High Impact events can and do occur; and we've come to appreciate what a strategic shock feels like because whilst a pandemic was always high on the Government's Risk Register, it was a flu pandemic that we were prepared for not a SARS-2 Coronavirus. As Mark Twain so presciently said: "prediction is easy so long as you steer clear of the future". And in the absence of accurate weather forecasting, pricing in the resilience to be able to absorb a shock, adapt and still emerge more competitive than the opposition may be the entry-cost for survival of many of our businesses.
And unsurprisingly the events of the last 18 months have prompted a re-appraisal of many of our priorities since shocks tend to focus the mind. And in my world, it's reminded us of the importance of thinking much more strategically and expansively about the nature of Defence and its relationship in a fast-changing world with the country's security.
Because amongst other significant changes, we're witnessing the rollback and truncation of some of the more collaborative elements of Globalisation; vaccine diplomacy for instance, just at that moment when in the face of a global pandemic we all need an international consensus more than ever. The re-imposition of border controls, sovereign territorial integrity a thing again, the notion of self-sufficiency; it's called 'strategic autonomy' in Paris today, and until recently America First, and the further east you go, Made in China 25.
Just as our daily lives, tactical time has slowed down; strategic time seems to have accelerated. We've all been through a digital bootcamp and whilst our personal geography may have shrunk our virtual networks have expanded exponentially. Things that only 18 months ago seemed inconceivable, are now accepted as the new abnormal. Maybe Lenin was right, there really are weeks when decades happen. And perhaps we are deeper into the 3rd decade of the C21 than we yet realize with the Pacific century arriving much faster than we appreciated.
So that's why I emphasize this point about a prevailing condition of strategic volatility. Yes, it's exacerbated by Covid, but actually it's the product of several longer-term trends that have been accelerating at exponential pace, supercharged by the democratising effect of a permanent and escalating technological revolution which in inevitable historical coincidence, aligns with the re-emergence of Great Power competition between states and balance of power considerations once more the currency of strategic exchange, defined by the application of state power in pursuit of competing grand-strategic visions. One planet, two systems. Power, its authority, influence and projection being both a Means and an End in a competitive international system.
And it's an uncomfortable reminder that the rules-based system that has regulated international discourse for all of my life, isn't self-sustaining and indeed nor is it self-organising. It's actually underpinned by power, raw hard power, predominantly albeit not exclusively, American hard power. And it's not too early to see the rough outline of a new geo-political age emerging; conceivably the rebalancing of one trans-Atlantic era with a growing emphasis on the Asia-Pacific in response to an increasingly bifurcated world hinged around China. America's strategic vision shifting to a new conception of its interests in Europe and the Middle East in proportionate response to the systemic competition unfolding across the Pacific.
And these tectonic generational shifts are compounded by a proliferation of threats to our security that are much more hybrid and much more difficult to protect against. It's not only missiles and tanks, much as Russia today reminds us how dangerous they can be. It's also the consequences of this era of Truth Decay: subversion, disinformation, techno-authoritarianism, the internet not just a means of communication but a tool for coercion and cyber-contagion. Big Tech very quickly can become Big Brother: Ransomware and DarkSide.
We're also living through a second wave of Imperialism but in a C21 context, with data now at the centre of global trade; this is a second wave of Data Imperialism where most of the big players aren't governments or even countries, they're private companies in an era when shaping the rules around digital power is a key component in geo-political competition. A Digital Silk Road to complement its economic Belt and Road, China has a strategic vision for the Digital Age. China Standard. It even has a date - 2035. It's hard to overstate the importance of this Technological Arms Race because it's difficult to imagine that some digital World Health Organisation is going to ride to our rescue, setting rules around cyber-hygiene and arms control. It's still a digital Wild West in which it would be a mistake to fall into the trap of technological dependency.
So the picture is one of growing systemic competition. In some respects, the deliberate weaponization of those elements of globalisation that hitherto we assumed would keep us safe and prosperous - the free movement of people, goods, data and ideas; and in the light of our Covid experience we might also want to reflect on the importance to our security of the integrity of our 5G networks and wider digital infrastructure, on our assured access and control of pharmaceuticals, the re-shoring of some of our more sensitive supply chains and strategic stock-piles; and the impact of Artificial Intelligence and quantum computing; and of course the very real significance of clean and reliable energy to our future. In many respects, these are just as important to our national security alongside the financial health of the nation, as our more traditional conventional military advantages.
The notion of strategic resilience and the integrity of our strategic base and critical national infrastructure is on the table again in an uncertain and unpredictable world. One in which Pax Americana finds itself being stretched by no less than three authoritarian states; Russia, Iran and China, each of which is seeking its own independent sphere of influence separate to any American-backed global order or rule book. And so we sit at the juncture of three potential confrontations:
The first and closest to home, is the incremental erosion of the European security settlement that has broadly pertained since the fall of the Berlin Wall in 1989. It is being challenged most directly by Russia and Russia today is not a status quo power. Stung by then President Obama's dismissal as not much more than a regional power, Russia craves an equivalence at the top table, alongside the United States, but its roguish behaviour and its reputation as the most prolific stoker of instability on Europe's borders, meddling in Western liberal democracies, only undermines its legitimacy; Russia seems bent on a systematic campaign of division across Europe and its alliances whilst developing a potent mix of hybrid capabilities to threaten our democracies. It's in revisionist mode and whilst we may read Russia less well today than the Kremlinologists of the past, their lack of respect for weakness, especially military weakness, hasn't changed one bit.
Strategic co-operation with Russia has been in decline for too long, trust is in very short supply and relations feel at best brittle. But establishing a European consensus as to how to manage Russia is proving elusive, an opportunity that Moscow is quick to exploit. And whilst Russia may appear to some as a power in decline, Russia still matters a lot, especially in Europe. It comes with a lethal inventory, a growing and unpredictable risk appetite and undiminished ambition and that's a cause for concern. More than anything now, we need a more principled and structured relationship with a more responsible and constructive Russia. The lack of it leads to a relationship that is immediately confrontational which is in no-one's interest.
The second hotspot is the Middle East which continues to spawn a range of coterminous crises exacerbated by the grinding tectonic plates of generational change across the region. The Syrian civil war, the Yemeni humanitarian disaster, residual Al-Qaida/Daesh presence and the existential legacy of Western interventions over the last 30 years which together have redefined the strategic geometry of the region. Today the net beneficiary seems to be Iran, busy exploiting political vacuums and re-establishing the Shia Crescent from the Mediterranean to Tehran, transforming its geo-strategic position, mobilising its proxies, and extending its malign influence through the region; and seemingly no longer deterred by conventional American capabilities.
My third and final touchstone is of course China. Possibly within a decade the world's largest economy, and conceivably by the middle of the century with an economy larger than the United States and the EU combined. So China, destined to become the world's economic powerhouse, matched by the world's largest Armed Forces - controlled not by a democracy but by the Chinese Communist Party. A Communist Party who don't share our world view or our values and who regard the international rules-based system as not much more than code for Western hegemony. And the very real prospect, despite its lack of democratic legitimacy, that the CCP will usher in an era of economic growth such that each successive Chinese generation gets progressively richer. We will have to hope that that is equally true here in the West.
So we have to get China right, because Great Power competition doesn't necessarily lead inevitably to Great Power conflict or the Thucydides Trap. But there is a danger of strategic miscalculation. Not helped by China's propaganda, by its assertive agenda and hard-line strategy of wolf-diplomacy and economic coercion. China seems to believe that their inexorable rise is matched by the terminal and irreversible structural decline of the West with the associated changes in the international landscape falling in their favour as they place ever-greater emphasis on digital domination, artificial intelligence and a growing economic self-sufficiency, relying on domestic consumption as a long-term driver of economic growth and the gravitational pull of the world's largest single consumer market. But that of course is to overlook the considerable internal tensions, paradoxes and contradictions that China faces; a country that had to spend around 216 billion dollars on domestic public security in 2019 alone. Managing these internal inequalities may prove to be the Party's single greatest challenge, giving the lie to any assumed historical inevitability about China's invincibility.
So in dealing with China, which we must, there are probably some sensible principles; firstly size matters, and allies and partners will become even more important to the maintenance of an overall balance of power because even the strategic inventory of the United States, on its own, lacks the requisite heft; so it makes sense to approach it on a regional basis rather than having all our eggs in a china basket.
Hence our emphasis on a broader Indo-Asia-Pacific strategy linking India, Indonesia, South Korea, Japan, Australia and NZ and it shouldn't be a surprise that the inaugural patrol of our latest and largest-ever aircraft carrier is to the Far East. If China is going to be a systemic competitor, it's in all our interests to keep it that way; a competition rather than a conflict. And our strategic dialogue needs to have sufficient tolerance to allow a widening, from a start point of negotiable economics to one of more substantial first principles across a range of load-bearing issues; think climate change, bio-diversity and trade most obviously where we share common interest, but also accommodating more difficult contentious issues where our values are at odds, over Human Rights and international rules and standards. Candour, honesty and transparency should characterize our relationship, a strategy of competitive and co-operative reciprocity.
So these aren't the easiest of times for reasonable and rational nations that set store by playing by the rules in a world increasingly hostile world that seems inimical to liberal democracy. It's certainly not a benign horizon as policy-makers grapple with the changing nature of systemic competition, the redistribution of global power and the rapidly evolving technological landscape which is exposing a growing gap as industrial-age organisations are confronted by information-age problems and the pace of change outstrips our institutional ability to re-apportion resources, to upskill workforces and contemporize our corporate culture while at the same time it renders legacy structures and systems obsolete ever more rapidly.
The list of things to do looks alarming: manage the rise of an assertive China, check Putin's Russia, halt Iranian malign influence and nuclear ambition, suppress radical Islamist terrorism, counter bio-terrorism and cyber-extortion, manage a global pandemic and tackle global warning. That's a big in-box and speaks to the need for a re-energised ambition and approach to Diplomacy, Defence, Security and Development. And the Government is matching its refreshed ambition with an extra £24Bn for Defence. A really significant strategic investment underpinning an outward-looking vision for a modern Global Britain. And we must spend it wisely since it's a commonplace that we have a world-leading Diplomatic Service and unrivalled intelligence agencies, Armed Forces, and an exceptional inventory of soft power but still the prevailing consensus is that we could do better by way of co-ordination and integration and in the context of a more competitive world, indeed we must do better.
Maximising the opportunities of our new-found independence and the latitude that comes with leaving the EU, reinforcing existing alliances whilst forging new partnerships and embracing a more proactive international agenda and posture, really getting after those metrics that are going to count in tomorrow's world: our national prosperity, our security and our international influence.
Which is why the emphasis today in the Armed Forces is to underwrite that strategic concept of Global Britain; which boils down to a dynamic international footprint supporting a global network of partners and allies, a modernized force structure with a richer blend of Regular and Reserves fit for the digital age and adapted to the changing character of warfare; supported by the capabilities, the culture and the skills for what actually lies ahead of us rather than is already behind us, recognising that the fundamental purpose of our Armed Forces is to prevent wars in the first place but to be prepared for warfare at its very most feral if it should come to it.
Not the last war we fought, or the war we'd like to fight or anticipate having to fight, but actually the war we may have no choice but to fight. Put simply, warfare is a reciprocal relationship and it happens when the people who start them think they are going to win, and sometimes they choose you. And we rather naturally assume that we're the C20 post-war generation. But what would it be like if we were wrong and that in fact we were actually the C21 pre-war generation and how would that feel? My job, Ladies and Gentlemen, is to make sure that we never get to find out.
Thank you all very much.
