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## 			DNI Haines Opening Statement As Delivered on the 2024 Annual Threat Assessment of the U.S. Intelligence Community		

 

On March 11, 2024, Director of National Intelligence Avril Haines delivered opening testimony at a Senate Select Committee on Intelligence hearing for the Annual Threat Assessment of the U.S. Intelligence Community. The opening testimony and public hearing is available to view here, and remarks as delivered are below.

 

**Opening Statement by****The Honorable Avril Haines,****Director of National Intelligence**

**Annual Threat Assessment of the U.S. Intelligence Community**

 

**March 11, 2024**

 

Chairman Warner, Vice Chairman Rubio, Members of the Committee, thank you so much for the opportunity to be here today, alongside my wonderful colleagues, to present the IC’s annual threat assessment.

 

And before I start, I also want to thank publicly the people of the Intelligence Community. From the collector to the analyst and everyone in between, we are really presenting the result of their labor at this hearing. And they work tirelessly every day to keep our country safe and prosperous, and we are all very proud to represent them here today.

 

I also want to take the opportunity to thank all of you for the extraordinary support that you have shown to the Intelligence Community. The IC’s relationship with its oversight committees is — quite obviously — critically important, and you all work with us on a bipartisan basis and that is especially inspiring in today’s environment. We are grateful for your encouragement and for your wisdom.

 

Today, the United States faces an increasingly complex and interconnected threat — as has been noted by the Chairman and Vice Chairman — an environment really characterized by three categories of challenges.

 

The first is an accelerating strategic competition with major authoritarian powers that are actively working to undermine the rules-based order and the open international system the United States and our partners rely on for trade, commerce, the free flow of information, and accountability to the truth.

 

The second category is a set of more intense and unpredictable transnational challenges — such as climate change, corruption, narcotics trafficking, health security, terrorism, and cybercrime — that often interact with traditional state-based political, economic, and security challenges.

 

And the third category is regional and localized conflicts that have far-reaching and, at times, cascading implications not only for neighboring countries, but also for the world.

 

And all three challenges are affected by trends in new and emerging technologies, environmental changes, and economic strain that are stoking instability and making it that much more challenging for us to forecast developments and their implications.

 

These dynamics are putting unprecedented burdens on the institutions and the relationships that the United States relies on to manage such challenges — and perhaps more than ever, frankly, highlight the need for sustained U.S. leadership to uphold the rules-based order.

 

And I’ll just touch on these three categories of challenges, starting with strategic competition and China, in an effort to provide some context and highlight some of the intersections.

 

President Xi continues to envision China as a leading power on the world stage, and Chinese leaders believe it is essential to project power globally in order to be able to resist U.S. pressure, for they are convinced that the United States will not tolerate a powerful China. Nevertheless, the PRC seeks to ensure China can maintain positive ties to the United States and will likely continue to do so this year, as they see stability in our relationship as important to their capacity to attract foreign direct investment.

 

Boosting the domestic economy is a fundamental priority for President Xi, yet he appears to be doubling down on a long-term growth strategy that will deepen public and investor pessimism over the near term. With youth unemployment around 14.9 percent, no major stimulus aimed at consumption forthcoming, massive local debts, and a property market contraction, 2024 is likely to be another difficult year for China’s economy — all against the backdrop of an aging and shrinking population and slowing economic growth.

 

President Xi is counting on China’s investments in technologies — such as advanced manufacturing and robotics, artificial intelligence, high-performance computing — to drive productivity gains and spur future growth, yet he is increasingly concerned about the United States’ ability to interfere with China’s technological goals.

 

Consequently, in an effort to protect and promote China’s capacity to compete technologically, which President Xi views as fundamental to his long-term growth strategy, PRC leaders modified their approach to economic retaliation against the United States over the last year, imposing at least some tangible costs on U.S. firms even as they continue to moderate such actions to avoid domestic costs.

 

Chinese leadership is furthermore pursuing a strategy to boost China’s indigenous innovation and technological self-reliance; expand their efforts to acquire, steal, or compel the production of intellectual property and capabilities from others, including the United States; and continue to engage in coercive behavior to control critical global supply chains of relevance.

 

In the meantime, President Xi’s emphasis on control and central oversight is unlikely to solve the challenges posed by China’s economic and endemic corruption, demographic decline, and structural economic constraints. And over the coming year, tension between these challenges and China’s aspirations for greater geopolitical power will probably become all the more apparent.

 

Given its ambitions, Beijing will continue to use its military forces to intimidate its neighbors and to shape the region’s actions in accordance with the PRC’s priorities. We expect the PLA will field more advanced platforms, deploy new technologies, and grow more competent in joint operations, with a particular focus on Taiwan and the western Pacific. And, the role intended for China’s growing nuclear forces and cyber capabilities in this effort, and the ultimate intent behind unprecedented growth in these areas, remain a priority for us in the IC and they are not unrelated to actions of Russia.

 

President Putin’s war of aggression against Ukraine continues unabated. Ukraine’s retreat from Avdiivka and their struggle to stave off further territorial losses in the past few weeks have exposed the erosion of Ukraine’s military capabilities with the declining availability of external military aid. The assistance that is contemplated in the Supplemental is absolutely critical to Ukraine’s defense right now and, without that assistance, it is hard to imagine how Ukraine will be able to maintain the extremely hard-fought advances it has made against the Russians, especially given the sustained surge in Russian ammunition production and purchases from North Korea and Iran.

 

Meanwhile, President Putin is increasing defense spending in Russia, reversing his longstanding reluctance to devote a high percentage of GDP to the military, as he looks to rebuild. In many ways, this is prompted by the fact that Russia has paid an enormous price for the war in Ukraine. Not only has Russia suffered more military losses than at any time since World War II — roughly 300,000 casualties and thousands of tanks and armored combat vehicles, setting them back years — it has also precipitated Finland and Sweden’s membership in NATO, which Putin believes requires an expansion of Russia’s ground forces.

 

Putin continues to judge that time is on his side and almost certainly assumes that a larger, better equipped military will also serve the purpose of driving that point home to Western audiences. Such messaging is important because Putin’s strategic goals remain unchanged. He continues to see NATO enlargement and Western support to Ukraine as reinforcing his long-held belief that the United States and Europe seek to restrict Russian power and undermine him.

 

And, of course, in the meantime, Russia continues to modernize and fortify its nuclear weapons capabilities, even though it maintains the largest and most diverse nuclear weapons stockpile. We remain concerned that Moscow will put at risk longstanding global norms against the use of asymmetric or strategically destabilizing weapons, including in space and in the cyber domain.

 

Another critical intersection we are monitoring is the relationship, as the Vice Chairman noted, between the government of Russia, China, North Korea, and Iran, which is evolving as these four countries expand collaboration through a web of bilateral — and in some cases trilateral — arrangements. This growing cooperation and willingness to exchange aid in military, economic, political, and intelligence matters enhances their individual capabilities, enables them to cooperate on competitive actions, assists them to further undermine the rules-based order, and gives them each some insulation from external international pressure.

 

And, nevertheless, we assess these relationships will remain far short of formal alliances or a multilateral axis. Parochial interests, desire to avoid entanglements, and wariness of harm and instability from each other’s actions will likely limit their cooperation and ensure it advances incrementally, absent direct conflict between one of these countries and the United States. And, nevertheless, the power dynamics are shifting among them and this is creating new challenges. In particular, Russia’s need for support in the context of Ukraine has forced it to grant some long-sought concessions to China, North Korea, and Iran — with the potential to undermine, among other things, long-held non-proliferation norms.

 

And, as I noted in the beginning, intensifying transnational challenges are intersecting with these more traditional threats. For example, with the advent of generative AI, states and non-state actors who are interested in conducting foreign malign influence operations no longer need to master a language to create potentially believable false content. The threat of malign actors exploiting these tools and technologies to undercut U.S. interests and democracy is particularly potent as voters go to the poll in more than 60 elections around the globe this year, as the Chairman noted.

 

We have also seen a massive increase in the number of ransomware attacks globally, which went up roughly 74 percent in 2023 from what it was in 2022, and U.S. entities were the most heavily targeted. Many of these are conducted by non-state actors, with the Russia-based cybercriminal group LockBit remaining the most popular ransomware-as-a-service provider. LockBit was responsible for nearly a quarter of all claimed attacks worldwide, leading to a joint effort by 11 countries to seize its resources and take down its online domains.

 

Transnational criminal organizations and human smuggling operations increasingly exploit migrants through extortion, kidnapping, and human trafficking.

 

And, in particular, the threat from illicit drugs remains at historic levels, with Mexican transnational criminal organizations supplying and moving large amounts of synthetic opioids, such as fentanyl, into the United States. More than 100,000 Americans have died from drug-related overdoses during the past year, and most of those deaths have been attributed to illicit fentanyl. And, as such, the threat from fentanyl and other synthetic drugs to the health and welfare of everyday Americans remains a top priority for the Intelligence Community.

 

In the third category, we have multiple regional conflicts with far-reaching implications — perhaps nowhere more obviously than in the Middle East. This crisis in Gaza is a stark example of how regional developments have the potential for broader, and even global, implications.

 

Now having lasted for more than five months, the Gaza conflict has roiled the Middle East with renewed instability, presenting new security paradigms and humanitarian challenges while pulling in a range of actors.

 

The conflict has prompted new dynamics even as it has entrenched old ones. We continue to assess that Hizballah and Iran do not want to cause an escalation of the conflict that pulls us — or them — into a full-out war. Yet, the Huthis entered the war and were willing to do so without Iran acting first, becoming one of the most aggressive actors in the conflict. And the Iranian-aligned militia groups in Iraq and Syria that have been attacking our forces and have been more focused on the United States than Israel, using the conflict as an opportunity to pursue their own agenda.

 

Moreover, the crisis has galvanized violence by a range of actors around the world and while it is too early to tell, it is likely that the Gaza conflict will have a generational impact on terrorism. Both al-Qa’ida and ISIS, inspired by HAMAS, have directed supporters to conduct attacks against Israeli and U.S. interests, and we have seen how it is inspiring individuals to conduct acts of antisemitism and Islamophobic terror worldwide.

 

In this third category of regional and localized conflicts, we have many more we might discuss, including Haiti, Sudan, what is happening in the Eastern Democratic Republic of the Congo, and the list goes on.

 

This finally brings me to Section 702 of the Foreign Intelligence Surveillance Act, which will expire on April 19th without congressional action. The intelligence gathered pursuant to Section 702 was essential in preparing this annual threat assessment and is absolutely fundamental to every aspect of our work, as I know you know.

 

Section 702 provides unique insights into foreign intelligence targets — such as foreign adversaries; terrorist organizations, including HAMAS; weapons proliferators; spies; malicious cyber actors; and fentanyl traffickers — and it does so at a speed and reliability that we simply cannot replace with any other authority.

 

As Congress pursues reauthorization, we understand there will be reforms and we support those that bolster the compliance and oversight regimes in place, while preserving the operational agility that is vital to keeping the nation safe.

 

Thank you for your patience, and we look forward to your questions.

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