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PM looks to defence for economic boost

Last updated on 3 March 2016

Having all but abandoned any hope of significant tax reform prior to the election, the Turnbull government has outflanked Labor with a huge commitment to expand and develop Australia’s defence industries over coming decades.

The Opposition was all but reduced to silence after Malcolm Turnbull launched a long- postponed defence white paper that set out a $450 billion defence spend over the next decade that will involve a total restructuring of defence-related industries, particularly shipbuilding.

submarinesThe biggest single contract in Australian military history will be the $50 billion allocated to acquiring 12 new submarines for the Navy, on which work will start in 2018. The ships will requirew an additional spent of almost double that amount to arm and maintain them. The hi-techw weaponry will come from the United States, but the government has yet to decide whether they will be built by s Japanese or German consortium. An announcement on this will be made before the Federal general election, expected in September or October.

The white paper identifies concerns over potential instability in the Pacific and Indian oceans as the main driving force behind Canberra’s decisions, with great uncertainty over China’s actions in the East and South China’s seas.Prime minister Malcolm Turnbull made no bones about this in his introduction to the white paper. Noting that half the world’s submarines and combat aircraft will be operating in the region in the years  ahead,  and that most of Australia’s interests were dfictatedf by trade routes, Turnbull said, “”We would be cif (China’s) growth were to lead to instability and threaten Australian interests.In the period to 2035, Australia will have greater opportunities for prosperity and development but it will also face greater uncertainty. We need to be prepared,”

But Turnbull’s more immediate aim is to shore up marginal seats in South and Western Australia and Queensland that have been thought to be at risk by the impending loss of jobs in shipbuilding and defence. The submarine decision, when announced, will be3 a valuable boost to jobs in these states, along with the announcement of a$230 million Centre for Defene InRead analysisdustry Capability, and a $640 million Defence Innocation Hu

Read the full white paper or download as a PDF

Read analysis by the Australian Strategic Policy Institute.