The Australian government released a big-spending economic plan for the next fiscal year on Tuesday that includes hefty investments in defense and national security as relations with China worsen.
The government plans to spend 270 billion Australian dollars ($212 billion) over the next decade on upgrading defense capabilities to “promote an open and peaceful Indo-Pacific,” Treasury Department documents say.
This includes AU$747 million ($585 million) to upgrade four military training areas in the Northern Territory where U.S. Marines have a temporary base.
The government announced in March that it would begin building its own guided missiles in close collaboration with the United States. The AU$1 billion ($784 million) project would produce the first Australian-manufactured missiles since the 1960s.
The government also plans to spend AU$1.3 billion ($1.02 billion) over a decade to enhance the ability of the Australian Security Intelligence Organization, the nation’s main spy agency, to address national security threats.
“We . . . need to be prepared for a world that is less stable and more contested,” Treasurer Josh Frydenberg told Parliament as he outlined his economic blueprint for the fiscal year starting on July 1.
The government has also proposed an additional AU$17.7 billion ($13.9 billion) spending on elder care over five years and a AU$15.2 billion ($11.9 billion) investment in infrastructure over 10 years.
Australia would loan Indonesia AU$1.5 billion ($1.2 billion) to manage coronavirus-related financial pressures, loan Papua New Guinea AU$558 million ($437 million) to support its pandemic response and give India AU$37 million ($29 million) in medical supplies. The spending measures need Parliament’s endorsement.
The pandemic last year derailed the political calendar that sets the budget as an annual event in May. The 2020-21 budget was delayed until October. It forecast a deficit of AU$214 billion ($168 billion) in the current fiscal year.
That deficit is now forecast to be AU$161 billion ($126 billion). The government expects the deficit will continue to decline in each of the next four years.