Rank #17 · Oceania
Australia spent $35.3B on defence in 2025 (1.9% of GDP), up 3% in real terms. The 2024 National Defence Strategy and the AUKUS submarine programme dominate the long-term outlook, with the Hunter-class frigate, General Purpose Frigate, and Ghost Bat collaborative combat aircraft driving the medium term.
The April 2024 National Defence Strategy and accompanying Integrated Investment Program (IIP) committed AUD 765B over the decade to 2033-34, with AUD 50.3B in additional funding above the prior baseline. Capital investment grows fastest, driven by SSN-AUKUS, Virginia-class interim submarine acquisitions, the Hunter-class frigate, the General Purpose Frigate (Mogami selected from Japan in late 2025), Ghost Bat MQ-28A, and long-range strike (Tomahawk, JASSM-ER, PrSM, Naval Strike Missile, and Precision Strike Guided Weapons Manufacturing). Personnel costs rise with the Defence workforce growth target of about 80,000 ADF members by 2040. Operations spending remains modest with no major combat deployments.
The Australian Defence Force fields about 60,300 regular personnel across the Army, Royal Australian Navy, and Royal Australian Air Force. The Army is restructuring under Plan Keogh into a focused-force model centred on littoral manoeuvre and long-range fires, with HIMARS, PrSM, and the new amphibious capability based on Adelaide-class LHDs. The RAN operates Hobart-class destroyers, Anzac-class frigates (transitioning to Hunter-class and the new General Purpose Frigate), Collins-class submarines (life-of-type extension under way), and is preparing infrastructure at HMAS Stirling for the AUKUS submarine rotational force from 2027 (SRF-West). The RAAF operates F-35A, F/A-18F Super Hornet, EA-18G Growler, P-8A, E-7A Wedgetail, and is fielding the Ghost Bat MQ-28A.
Australia is shifting from a primarily importing posture toward sovereign industrial capability under the 2024 Defence Industry Development Strategy. Key priorities are guided weapons and explosive ordnance manufacturing (GWEO Enterprise), continuous naval shipbuilding (Hunter at Osborne, General Purpose Frigate at Henderson WA), and AUKUS Pillar 2 capabilities. Boeing's MQ-28A Ghost Bat is Australia's flagship clean-sheet sovereign aerospace program. ASC, Austal, BAE Systems Australia, Thales Australia, and Lockheed Martin Australia anchor the industrial base. Australia is a major importer of US, UK, French (legacy), and increasingly Japanese systems (Mogami GPF) and Korean systems (Hanwha Redback IFV under LAND 400 Phase 3).
Australia has no active combat operations but is increasingly oriented toward Indo-Pacific deterrence. The 2024 NDS designates Australia's primary strategic problem as the prospect of major-power conflict in the Indo-Pacific. Forward presence includes Royal Australian Navy task groups in the South China Sea (rules-based order presence operations), regular FONOPS-adjacent passages, Operation Argos enforcing UNSC sanctions on North Korea, Operation Manitou in the Middle East, and a long-running training mission in Ukraine (Operation Kudu) under Operation Interflex. Domestic exposure includes northern approaches surveillance (Jindalee Operational Radar Network — JORN — undergoing modernisation) and counter-grey-zone activity in the Pacific.
On 27 April 2026, SIPRI confirmed Australia's 2025 spend at $35.3B (1.9% GDP). In November 2025 Australia selected the Mitsubishi Heavy Industries Mogami-class derivative for the General Purpose Frigate program (~11 ships). The first AUKUS Submarine Rotational Force-West preparations at HMAS Stirling continued through 2025 ahead of US Virginia-class rotations from 2027. The first Australian-purchased Virginia-class hull is contracted for delivery in the early 2030s. Ghost Bat MQ-28A flew expanded test sorties through 2025. The 2024 Defence Strategic Review implementation continued with Land 400 Phase 3 (Hanwha Redback) deliveries underway.
A 2021 trilateral security partnership between Australia, the UK, and the US. Pillar 1 delivers Australia nuclear-powered conventionally-armed submarines (initial Virginia-class purchase, then SSN-AUKUS co-built with the UK). Pillar 2 covers advanced capabilities — undersea, hypersonic, AI, quantum, cyber, EW. SRF-West rotations begin at HMAS Stirling in 2027.
SIPRI puts 2025 spending at $35.3B (1.9% of GDP). The 2024 Integrated Investment Program commits AUD 765B over the decade to 2033-34 with the spending share rising toward 2.4% of GDP later in the decade.
The MQ-28A Ghost Bat is a collaborative combat aircraft (CCA) developed in Australia by Boeing Defence Australia for the RAAF. It is Australia's first clean-sheet domestic combat aircraft program in over 50 years and is intended to operate as a loyal-wingman teaming with crewed aircraft like the F-35A and E-7A.
Currently the diesel-electric Collins class (six boats), undergoing a life-of-type extension. Under AUKUS Pillar 1, Australia will acquire 3-5 US Virginia-class boats from the early 2030s, then transition to the SSN-AUKUS class co-built with the UK from the late 2030s/early 2040s.