U.S demands Australia increase defense spending to 3.5% of GDP

Japan Times

2 days ago

The U.S. has asked Australia to hike defense spending to 3.5% of its gross domestic product "as soon as possible," the Pentagon said, in a move that could signal a looming similar demand for Japan.
U.S. Defense Secretary Pete Hegseth conveyed the figure to Australian Defense Minister Richard Marles on the sidelines of the Shangri-la Dialogue security conference in Singapore over the weekend, where the pair held talks amid rising tensions with China.
Australia currently spends about 1.9% of GDP on defense, or about 55.7 billion Australian dollars ($37 billion), and an immediate boost to 3.5% would take that to nearly AU$100 billion.
Australian Prime Minister Anthony Albanese, however, said Canberra would not be dictated to by its ally, noting that the country was already planning to pour a significant amount of cash into defense coffers.
'What we'll do is we'll determine our defense policy,' Albanese said, noting recent investments and adding that Australia would 'continue to provide for investing in our capability but also investing in our relationships in the region.'
Australia's 2024 national defense strategy promised a significant increase in spending, with the defense budget aiming to reach about AU$67.4 billion in 2027-2028 and AU$100 billion by 2033-2034, putting it at 2.3% of GDP.
In a speech Saturday outlining U.S. defense strategy in Asia, Hegseth warned that Beijing is 'credibly preparing to potentially use military force to alter the balance of power in the Indo-Pacific.'
'The threat China poses is real,' he added. 'And it could be imminent.'
Hegseth also sought to link this to U.S. demands that Asian allies and partners spend more on their own defense, calling on them to follow Europe's example and commit to higher spending and burden-sharing.
'NATO members are pledging to spend 5% of their GDP on defense, even Germany,' he said. 'So it doesn't make sense for countries in Europe to do that while key allies in Asia spend less on defense in the face of an even more formidable threat.'
Officials in Tokyo are closely watching how U.S.-Australia defense spending talks unfold, with U.S. President Donald Trump repeatedly labeling the U.S.-Japan alliance as 'unfair' and senior Pentagon officials pushing the top Asian ally to also spend more on its defense.
Ostensibly pacifist Japan has in recent years undertaken a dramatic transformation of its security policy, including a five-year plan to ramp up defense spending to 2% of its GDP by 2027.
Defense spending and related costs for this year were expected to total ¥9.9 trillion ($70 billion), equivalent to roughly 1.8% of GDP at the time of the plan's formulation in 2022, according to Defense Minister Gen Nakatani.
But ramping up defense budgets even further would come with significant political and economic constraints, something Nakatani alluded to following talks with Hegseth on Saturday.
Asked whether the two had spoken about a specific number for Japan's defense budget, Nakatani brushed away questions, saying only that he had reiterated Japan's view that 'what is important is the substance of strengthened defense capabilities," not an arbitrary figure.