Australia will gain the capacity to make its own guided missiles in a $1 billion federal plan to build a new weapons facility with a global arms manufacturer, preparing for greater tensions in the region.
The spending will upgrade Australia’s capabilities at a time of rapid advances in guided missiles, which are changing the dynamics of national defence with the development of hypersonic weapons that exceed the speed of sound.
Prime Minister Scott Morrison will announce the plan on Wednesday with a warning the “changing global environment” highlights the need to create the sovereign capacity.
The Australian Strategic Policy Institute estimates the country may have to spend $100 billion on missiles and other guided weapons over the next two decades to respond to rising powers such as China.
The new plan sets up a contest between private companies to bid for the contract to build the facility, with state governments also likely to lobby to gain the investment and jobs.
Companies such as Raytheon, Lockheed Martin, Kongsberg and BAE Systems are seen as likely bidders for the work, which would allow Australia to replace missiles currently shipped from overseas.
Australia last made its own missiles in the 1960s when local researchers created the Ikara anti-submarine missile and launcher, which was built in Melbourne.
The need for a stronger local capacity was made clear after the government released a Force Structure Plan last July that emphasised the greater use of guided weapons, in part due to the increased tensions in regional sea lanes.
“As the COVID-19 pandemic has shown, having the ability for self-reliance be it vaccine development or the defence of Australia, is vital to meeting our own requirements in a changing global environment,” Mr Morrison said in a statement ahead of the announcement.