Espionage cost Australia at least $13.6 billion in the last financial year, country’s spy boss says

The Australian Collins-class submarines will be replaced by nuclear-powered subs with technology provided by the US under Aukus. Photo / Australian Defence Force

Australia’s spy chief said espionage cost the economy a minimum A$12.5 billion ($13.6b) in the 2024 financial year, as he sought to raise awareness about the intensification of foreign efforts to steal information.

Mike Burgess, the director-general of the Australian Security Intelligence Organisation, said that his group had partnered with the Australian Institute of Criminology to produce its first cost of espionage report.

The ASIO chief said it’s probably the first and definitely the most comprehensive public analysis of its kind in the world.

“As just one example, the institute estimates foreign cyber spies stole nearly A$2b of trade secrets and intellectual property from Australian companies and businesses in 2023-24,” Burgess said in a lecture in Adelaide yesterday.

“The report includes a case study where spies hacked into the computer network of a major Australian exporter,” he added.

“The theft gave the foreign country a significant advantage in subsequent contract negotiations, costing Australia hundreds of millions of dollars.”

As global protectionism rises and efforts to secure trade advantages mount, Burgess said gaining the upper hand in contract negotiations at a state or corporate level is becoming more lucrative.

Foreign intelligence services are also taking “a very unhealthy interest” in Aukus and its associated capabilities, he added.

Under the security partnership signed in 2021, the United States and United Kingdom agreed to collaborate to provide Australia with a fleet of nuclear-powered submarines to ramp up Canberra’s defence capabilities in the face of growing strategic competition with China in the Indo-Pacific.

Burgess noted that Australia is not just defending its capabilities with the partnership, but also the “critical capability shared by and with our partners”.

The ASIO boss said three people are currently before Australian courts on espionage-related charges, and he reckons there “could be more if anyone tries to compromise Aukus”.

Referring to the report’s findings, Burgess said A$12.5b significantly underestimated the true cost of espionage.

The institute deliberately chose to be conservative, only modelling costs it could confirm and calculate, he added.

“That means many of the most serious, significant and cascading costs of espionage are not included,” he said.

“The potential loss of strategic advantage, sovereign decision-making and warfighting capacity hold immense value, but not a quantifiable dollar value.”