Australia’s outgoing spy chief says malevolent state espionage and foreign interference poses an “existential threat” to Australia in a way that extremist terrorism does not.

Duncan Lewis, the director general of the Australian Security Intelligence Organisation, will retire this month after a five-year term, handing over to Signals Directorate boss Mike Burgess.

He told a Lowy Institute forum on Wednesday night that of the three major “vectors” threatening Australia’s security – espionage and foreign interference; terrorism; and cybersecurity – the interference of hostile state actors posed the most serious threat.

“It’s my view that currently, the issue of espionage and foreign interference is by far and away the most serious issue going forward,” Lewis said. “Terrorism has never been an existential threat to established states – for weaker states, yes, but for a place like Australia terrorism is not an existential threat to the state. It is a terrible risk that our populations run and it is a very serious matter which must be addressed every day: the counter-espionage and foreign interference issue, however, is something which is ultimately an existential threat to the state.”

While terrorist attacks attracted intense public attention, Lewis said, the threat of espionage was often harder to immediately recognise.

“The harm from acts of espionage may not present for years or even decades ... these sorts of activities are typically quiet, insidious and have a long tail.”

Lewis stressed that terrorism remained a threat, and its risk was “unacceptably high”.

“Terrorism has plateaued, it is not increasing, it has plateaued and it is at an unacceptably high level. We have attacks continuing. They are regular and they will continue.

“Counter-espionage and foreign interference … that is still on a growth trajectory.”

Lewis said the while intelligence services were aware of the threat posed by cybercrime and cyberattacks, they were still “getting a better understanding of the breadth and the depth of the cyber vector to us”.

Lewis said foreign interferers – whether state or non-state actors – had been facilitated by technological advances.

“Communities and countries are able to interfere in one another’s business now, because you can,” he said. “There are conduits through all of those technological advances of globalisation: the internet, instant communication … social media, that will allow influence to be exerted remotely.”

In an hour-long presentation, Lewis did not use the word China once – even when directly invited to by his interlocutors – but China’s increasing military might and presence across the Asia-Pacific has concerned Australia’s intelligence operatives and politicians, who last month also pledged to crack down on interference in Australian universities.

China is believed to have been behind a sophisticated hack on the Australian National University’s computer database in 2018. Last month, officials from the Australian Signals Directorate briefed university vice-chancellors on the risk of hackers targeting valuable or sensitive research and personal data.

The NSW Independent Commission Against Corruption has heard over the past fortnight of a secretive $100,000 donation given to the NSW Labor party in an Aldi shopping bag, allegedly from banned donor Huang Xiangmo, a billionaire Chinese property developer who had his permanent residency cancelled – effectively banning him from returning to Australia – after Asio believed he was “amenable to conducting acts of foreign interference” and had sought to influence Australian politics on behalf of the Chinese Communist party.

Lewis insisted his organisation was trying to find a “sweet spot” between passivity and overreaction in responding to security threats, and also to avoid the vilification of minorities, such as Muslim Australians or Chinese-Australians. He said security concerns must not be “underestimated nor over-egged”.

“It’s very hard in public discourse to get ... that sweet spot.”

Political rhetoric around actual or perceived Chinese influence in Australia has escalated in recent months.

In parliament and in a newspaper column, the chair of the parliamentary joint committee on intelligence and security, Andrew Hastie, described western complacency about China’s growing global ambition and militarism as akin to the appeasement of Nazi Germany in the lead-up to the second world war.

“Like the French, Australia has failed to see how mobile our authoritarian neighbour has become. Even worse, we ignore the role that ideology plays in China’s actions across the Indo-Pacific region.”

Lewis said he had previously spoken to politicians about tempering their rhetoric on minority groups to preserve community relationships.

“You can very quickly get to the point where you can vilify the many for the actions of the few … in the counter-espionage and foreign interference space, one needs to be careful that we don’t vilify some of our minority communities here, who are doing wonderful work, and are great Australians,” he said.

“I think getting this balance between zeroing in on those who would wish us harm but at the same time not vilifying the rest of their demographic or their community is very important.”

Lewis said Australia remained a “rich target” for state-sponsored cyber attacks and suggested that Australia in the future might need to consider giving the Australian Signals Directorate domestic spying powers.



The ASD’s powers have come under scrutiny after a newspaper article suggesting the agency’s role could be expanded led to police raids on the home of News Corp journalist Annika Smethurst earlier this year.



“It is emerging every day, new information about how we are threatened … by the cyber vector,” Lewis said. “And I think that, as we have those discussions, it is necessary to have a look at capabilities such as the Australian Signals Directorate to see whether it can inform, or assist, or be deployed in the extreme in protecting Australians.”

AFP raids have also been conducted on ABC offices and, on Wednesday, on the Canberra home of government official and intelligence officer Cameron Gill.