2016 DEFENCE WHITE PAPER

Australia’s security environment 49
Military modernisation
2.36 It is natural for countries in the Indo-Pacific, including Australia,
to modernise their military capabilities as their economies grow,
technology develops and new capabilities become available. The pace
of military modernisation in the Indo-Pacific is underpinned by the very
positive economic transformation of the region.
2.37 Asia’s defence spending is now larger than Europe’s. In 2014,
military spending in Asia increased by five per cent, reaching around
$439 billion in total, compared to spending in Europe which in 2014
grew by 0.6 per cent, reaching around $386 billion in total.
SECTION ONE STRATEGY
China USA Japan Australia Indonesia
2014
2035
Figure 1: Indicative Defence Spending to 2035
2.38 Military modernisation in our region will not be directed against
Australia, but it will mean the defence capability edge we have enjoyed
in the wider region will significantly diminish.
2.39 Successive Governments have identified maintaining the ADF’s
technology and capability superiority over potential adversaries as an
essential element of our strategic planning. Our ability to do this has been
based in a large part on our access to the advanced capabilities developed
by the United States. However, our future ability to maintain this superiority
will be challenged by the growth towards more-capable and modern
military forces in the Indo-Pacific region to 2035 and beyond.
2016 DEFENCE WHITE PAPER