Economic Diplomacy

Australia Looks to Buy B-21 Raider

With no long-range strike capabilities, Australia may be set to purchase a squadron of B-21 Raider stealth aircraft from the United States. No official announcement has been made, in part because the B-21 Raider will be unveiled publicly by contractor Northrop Grumman in December. The flare by Australian Defence Minister Richard Marles strikes a chord in a nation where apprehension is growing over a Chinese military presence in the Pacific.

This shift in attitude toward China is far from anecdotal. In June 2022, the Sydney-based Lowy Institute, a major think tank, published its annual foreign-policy survey. Among the most dramatic findings was the view of China as an adversary. A whopping 75% of Australians believe that “China will become a military threat to Australia in the next 20 years.” The result represents a 30 percentage point increase over the same question asked in 2018. Other relevant points include:

Pacific Islands. Some 88% of Australians are either “very” or “somewhat” concerned about China potentially opening a military base in a South Pacific country.

Taiwan. Near 64% of Australians believe that a military conflict between the United States and China over Taiwan represents a critical threat to Australia’s vital interests.

South China Sea. About 60% of Australians are in favor of the military conducting freedom of naval navigation operations in the South China Sea and other disputed areas.

In Australia, there is more than political expediency to the defense-spending debate. By some standards, Canberra has been slow to upgrade its forces since the Gillard administration first moderated military outlays a decade ago. As a percent of GDP, Australian armed-forces spending hit a historical low of 1.6% in 2013. The figure has since expanded; it is now reaching above 2%, in line with Western standards.

New defense outlays will presumably be spent in strategically prudent ways. In August, Prime Minister Albanese announced a comprehensive review of the nation’s offensive and defensive capabilities that is scheduled to be finished by February 2023. We expect to see surprises in the findings, including recommendations to streamline the military to cover the cost of advanced weaponry. There is precedent. In 1997, the Department of Defence announced widespread job terminations and base closures as part of a comprehensive restructuring plan.

Buying a B-21 Raider is a deep-pocket decision. The actual production cost of the new-generation stealth bomber to US taxpayers may be something like $700-to-$800 million each. We doubt Washington will approve a sale at a discount. Twenty of them could generate an invoice for $16 billion or so. At least on the surface, that figure represents about 50% of the most recent Australian defense budget.

For Australia, the B-21 Raider consideration comes at a time when military affairs are headline-prominent:

Technology. Canberra just committed to developing a battery of next-generation individual defense weapons with optical and laser systems. It also heralded the transfer of operational capability from the United States to Australia of a space surveillance telescope now located in Western Australia.

War Games. Operation Pitch Black, the biennial air-combat exercise hosted in the Northern Territory, was the biggest ever with 17 countries participating. Notably, Germany, Japan, and South Korea took part for the first time in the three-week event.

Regional Profile. At the beginning of October, Defence Minister Marles was hailed on the dais with his Japanese counterpart at the US Indo-Pacific Command Headquarters in Hawaii. With the US as host, the three parties met to hammer out agreements in the wake of Chinese aggression in the Taiwan Strait.

Once-routine discussions in Canberra have buoyancy that we have not seen in the past. A 2020 Department of Defence report asserted: “Reduced warning times mean defence plans can no longer assume Australia will have time to gradually adjust military capability and preparedness in response to emerging challenges.” Prime Minister Albanese, who took office at the end of May, underscores that reality in his fast-evolving policy platform.

A conspicuous defense profile will change the complexion of the Australian economy. We see similar trends throughout the region, even among smaller economies, as nations redouble their stance against Chinese threats, implied or real. Vietnam set out in 2021 to modernize its military, despite its longstanding non-aligned policies; the Philippines announced a military budget increase of 9% for 2023.

Our Vantage Point: Australia is set to project its military wherewithal in ways that are both unfamiliar on the global stage and supportive of Western interests. This assertive defense posture has sprouted from swelling international discord.

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Image: The current backbone of the Australian air force is the Lockheed Martin F-35A. While offering stealth capabilities, its range is limited to 2200 kilometers. Credit: Alexander at Adobe Stock.

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