In September 2021, the United States launched an unprecedented trilateral security partnership with the United Kingdom and Australia.

A deal that calls for Australia to build a fleet of world-class nuclear-powered submarines.

A deal forged as a bulwark amid rising tensions with China over disputes ranging from the South China Sea to Taiwan to shaping the governance of the amorphous Indo-Pacific region.

Most certainly named by a bureaucratic committee and not by communications pros, the clunkily named AUKUS or Australia, United Kingdom, and United States security pact is the most significant security arrangement among the three countries in a generation.

According to the Congress Research Service, attention initially focused on the proposed transfer of nuclear propulsion technology to Australia; however, observers now say the pact’s plan to develop advanced technologies and other military capabilities over the longer term may prove to be equally significant.

AUKUS is not a submarine deal.

Forty-one nations have submarines.

Any nation that wants a submarine can get a submarine.

But only six nations have submarines that have nuclear propulsion.

Any nation wanting a submarine with nuclear propulsion needs the technology.

A nation can build nuclear technology.

A nation can borrow nuclear technology.

A nation can buy nuclear technology.

A nation can even steal nuclear technology.

In coordination with the United Kingdom, the United States is boldly moving into the future of global security.

The United States is now sharing the crown jewels of its military technology, nuclear propulsion, with an ally for only the second time in 65 years (the other time being with Britain).

The sharing of America’s crown jewels of its military technology opens the door for nearly all knowledge to head to Oz.

In April 2022, AUKUS leaders committed “to commence new trilateral cooperation on hypersonics, counter-hypersonics, and electronic warfare capabilities” in response to China’s tests of its hypersonic missiles, which Chairman of the Joint Chiefs of Staff General Mark Milley described as “very concerning.”

AUKUS is like the Berlin Wall falling.

Antoine Bondaz, a Research Fellow at the Fondation pour la Recherche Stratégique, wrote that for China, the pact between Washington, Canberra, and London is “the realization of a longstanding fear: the multilateralisation of American alliances in the region. Today, it’s Australia and the United Kingdom. Tomorrow, maybe Japan will join.”

Later this afternoon, President Joe Biden will reveal the latest AUKUS nuclear submarine plans alongside United Kingdom PM Rishi Sunak and Australian PM Anthony Albanese at Naval Base Point Loma.

Politico reports that the event in San Diego, which could include a walk atop a submarine, will feature details on how Australia aims to acquire nuclear-powered submarines.

The geopolitical business implications of AUKUS are three-fold:

1) The AUKUS alliance will further stabilize the friendship between the United States, Australia, and the United Kingdom, securing this trilateral relationship for generations.

2) AUKUS will be a lasting feature of British foreign policy and the clearest example of what the tilt to the Pacific and the talk of ‘global Britain’ actually means. Between the launch of the magnificent HMS Queen Elizabeth (R08) and this deal, the United Kingdom is sending a strong signal to its reversion as a proper global seapower.

3) For Washington, Canberra is becoming more critical than London daily. Businesses should look for continued commercial opportunities in Australia and the Indo-Pacific region.

AUKUS is a big bet.

A big bet that places energy, resources, technology, and the attention of Australia, the United Kingdom, and the United States firmly in the Indo-Pacfific for multiple generations.

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Enjoy the ride + plan accordingly.

Marc