Australia as a Future Weapons Supplier: A Misguided Ambition? By Paul Walker
The claim that Australia could become a major weapons supplier for the United States under the $21 billion Guided Weapons and Explosive Ordnance (GWEO) Enterprise, as outlined in a July 22, 2025, Epoch Times article by Cindy Li, has sparked scepticism given Australia's diminished manufacturing base. Critics argue that a nation struggling to produce even basic goods like toothpicks, most of which are imported, lacks the industrial capacity to deliver sophisticated munitions on a global scale. This discussion contends that while the GWEO initiative reflects strategic ambition, Australia's lack of a robust manufacturing foundation, overreliance on foreign partners, and slow progress in a deteriorating Indo-Pacific security environment make the goal of becoming a significant U.S. weapons supplier more aspirational than realistic, bordering on a risky misallocation of resources.
Launched in 2021, the GWEO Enterprise aims to transform Australia into a regional hub for missile and munitions production, with $16–21 billion committed over the next decade to build domestic facilities in partnership with the U.S. The plan, detailed in the 2024 Australian GWEO Plan, includes contracts like $850 million with Kongsberg Defence Australia to produce Naval Strike Missiles (NSM) and Joint Strike Missiles (JSM) by 2027, $37.4 million with Lockheed Martin Australia for Guided Multiple Launch Rocket Systems (GMLRS) starting in 2025, and $22 million to explore a rocket motor manufacturing facility by 2030. These investments align with the 2024 National Defence Strategy, aiming to bolster Australia's long-range strike capabilities and integrate into global supply chains.
However, the initiative faces significant hurdles. The University of Sydney's U.S. Studies Centre report, "Partnering for forward deterrence in the Indo-Pacific," notes that GWEO's growth lags behind the region's worsening security situation, driven by China's military build-up and conflicts in Ukraine and the Middle East depleting U.S. stockpiles. Only 4.5% of the $810 million committed by 2024 has been spent, and less than 1% of the $21 billion planned over the decade, indicating a sluggish start. The "crawl-walk-run" approach, starting with foreign imports, then co-production, and eventually independent manufacturing, assumes a timeline that may not match the urgency of regional threats.
The scepticism about Australia's capacity to become a weapons supplier stems from its hollowed-out manufacturing sector. Once a producer of Spitfire aircraft during World War II, Australia's industrial base has eroded significantly. A 2023 Australian Bureau of Statistics report shows manufacturing's share of GDP has fallen from 25% in the 1970s to under 6% today, with 70% of manufactured goods, including basic items like toothpicks, imported. The closure of car manufacturing plants like Holden in 2017 and the reliance on imports for consumer goods, highlight this decline. X posts, such as @AussieMfgLost's July 2025 lament, reflect public sentiment: "We can't even make our own screws anymore, and they think we'll churn out missiles for the U.S.?"
This lack of industrial depth poses a critical challenge for GWEO. Precision-guided munitions (PGMs) require advanced manufacturing capabilities, skilled workforces, and secure supply chains, areas where Australia is starting from a "very low base," as noted by Defence Industry Minister Pat Conroy. The 1960s saw Australia produce some munitions, but today, all PGMs are imported, primarily from the U.S., Norway, and Israel. Building a new ecosystem for GMLRS, NSM, or 155mm artillery rounds demands not just funding but infrastructure, expertise, and supply chain resilience, all of which are currently deficient.
The GWEO's heavy dependence on U.S. and other foreign contractors, Lockheed Martin, Raytheon, Kongsberg, and Thales, undermines claims of "sovereign" capability. While partnerships with these firms bring technology transfers, as seen in the $37.4 million GMLRS contract and the planned Newcastle facility for NSM/JSM, they also highlight Australia's reliance on foreign intellectual property and components. The U.S. Studies Center report warns that U.S. hesitancy to share sensitive data, rooted in "Cold War muscle memory," could limit Australia's ability to scale production. Carl Schuster, former U.S. Pacific Command operations director, notes U.S. industry's scepticism toward bilateral projects, viewing them as losses to American jobs, further complicating cooperation.
Moreover, global supply chain vulnerabilities, exposed by COVID-19 and the Ukraine war, pose risks. Japan's struggles to produce Patriot interceptors due to U.S. component shortages illustrate this challenge. Australia's plan to produce 4,000 GMLRS missiles annually by 2029, over a quarter of global production, relies on U.S. technical data and supply chains, which could falter in a crisis. Without a robust domestic base, Australia risks being a junior partner assembling foreign designs rather than a true supplier.
The GWEO's focus on integration with U.S. supply chains, as Mark Cao argues, could reduce per-unit costs and address U.S. munitions shortfalls, with war games showing U.S. stocks depleting in a week during a Taiwan conflict. However, the initiative's scale is mismatched with Australia's strategic needs. The Australian Defence Force (ADF) requires immediate stockpile increases, yet GWEO prioritises long-term production (e.g., 2029 for GMLRS, 2030 for rocket motors), leaving the ADF reliant on imports in the interim. Travis Reddy of DefendTex argues that Australia could achieve faster results with non-U.S. partners like Brazil's Avibras, but GWEO's bias toward American firms limits such options.
The $21 billion investment also raises questions about opportunity costs. Australia's defense budget, at 2.3% of GDP, falls short of the 3.5% urged by some analysts. Diverting funds to GWEO could strain other priorities, like naval upgrades or cyber defence, especially given domestic economic pressures like 3.4% inflation and 4.3% unemployment. The Future Made in Australia Act, criticised for distorting markets, further ties GWEO to a broader industrial agenda that may value political optics over strategic efficacy.
Proponents, like Minister Conroy, argue that GWEO will create jobs (e.g., 400 direct and 1,000 indirect jobs from Lockheed's Newcastle facility) and position Australia as a regional defence hub. The plan's inclusion of small and medium enterprises (SMEs), with $150 million in grants, aims to rebuild industrial capacity. Integration with U.S. supply chains, as Cao suggests, could make Australia a vital ally, enhancing deterrence in the Indo-Pacific. Yet, these benefits are speculative. Job creation is modest compared to the investment, and SME involvement remains nascent, with primes like Lockheed and Thales dominating. The strategic environment, with China's growing assertiveness, demands faster results than GWEO's 2030 timelines allow, as noted by the Australian Strategic Policy Institute.
Critics also point out that Australia's historical reliability as a U.S. ally, as Schuster says, justifies U.S. support. However, U.S. scepticism and policy inconsistency, exacerbated by past strategic missteps like Iraq and Afghanistan, undermine long-term commitments, leaving Australia vulnerable to shifts in U.S. priorities. The idea of Australia as a "toothpick economy" incapable of complex manufacturing is overstated, given past successes like the Nulka missile decoy, but the gap between ambition and current capacity remains stark.
Australia's aspiration to become a U.S. weapons supplier under the $21 billion GWEO Enterprise is not a joke but a gamble fraught with challenges. The nation's eroded manufacturing base, reliance on foreign technology, and slow progress in a volatile Indo-Pacific make the goal ambitious, yet impractical. While partnerships with Lockheed, Kongsberg, and Thales offer a path forward, the lack of a self-sufficient industrial ecosystem and long lead times, 2029 for GMLRS, 2030 for rocket motors, undermine claims of sovereignty. Australia risks becoming a satellite assembler rather than a true supplier, diverting resources from more immediate defense needs. To succeed, GWEO must accelerate timelines, prioritise local innovation, and secure unwavering U.S. commitment, lest it remain a costly pipe dream in a nation struggling to produce even toothpicks.
"Australia Touted As Future Weapons Supplier For US Under $21 Billion Plan: Report
Authored by Cindy Li via The Epoch Times,
"Australia could become a supplier of weapons and munitions for the United States under a new radical proposal designed to better equip the world's largest military to deal with any threat in the Indo-Pacific.
The Guided Weapons and Explosive Ordnance (GWEO) Enterprise, developed in partnership with the United States, is geared towards building local production facilities for missiles and munitions in Australia.
Launched in 2021, the project is backed by a government commitment of $16–21 billion over the next decade.
Despite some progress—including the release of the Australian government's GWEO Plan in late 2024—the project still faces obstacles.
As a result, its growth has not kept pace with the region's worsening security situation, according to the new report titled, "Partnering for forward deterrence in the Indo-Pacific: Overcoming barriers to U.S.-Australia cooperation on Australia's GWEO Enterprise," by the University of Sydney's U.S. Studies Center.
Recommendations for US and Australia
The report, led by Dr Cynthia R. Cook, a senior fellow at the Center for Strategic and International Studies, urges the U.S. government to recognise the value of putting more resources into the GWEO.
The report suggests it could be "a potentially important solution to U.S. munitions shortfalls"—not by replacing the American industrial base, but by expanding it and incorporating Australia into it
For Australia, such a scheme could build U.S. confidence in Australian strategic and industrial capabilities, and advance regulatory reform.
The report also highlights the need to map out the munitions supply chain and identify its weaknesses for this to work.
'America First' Means Closer Integration With Allies: Analyst
Mark Cao, a military and aerospace commentator, known for the channel Mark Space, believes the integration is feasible, pointing to the February meeting between U.S. Secretary of Defense Pete Hegseth and Australian Defence Minister Richard Marles.
The two highlighted defence industrial cooperation on munitions as a key opportunity for strengthening bilateral ties.
"Since Australia's weapons systems are highly dependent on U.S. technology, the GWEO program is largely based on joint ventures with American defence contractors to produce the required guided weapons domestically," he told The Epoch Times.
As part of this initiative, the Australian government has signed a A$37.4 million contract with Lockheed Martin Australia to commence local production of Guided Multiple Launch Rocket System missiles in 2025.
The government also plans to invest A$60 million over the next five years to develop hypersonic and long-range strike capabilities.
Furthermore, A$22 million will be allocated over the next three years to seek industry options for establishing a rocket motor manufacturing facility.
Test fire of a development Joint Strike Missile on the US Air Forces F-35 Joint Strike Fighter. Courtesy of Kongsberg Defence Australia and the Australian Department of Defence.
Cao also approves the report's call for the White House to recognise GWEO as a key way to address U.S. munitions shortfalls.
"Although the United States currently champions the slogan of 'America First,' it has in fact strengthened cooperation with its allies when it comes to ensuring the combat readiness of its military," he said.
"For example, to accelerate the maintenance and servicing of U.S. Navy warships, the U.S. has commissioned shipyards in South Korea and Japan to assist with repairs and has even asked South Korean shipbuilders to help train skilled workers.
"In order to speed up the delivery of 155 millimetre artillery shells to Ukraine, the U.S. first drew from stockpiles held by U.S. forces stationed in South Korea, then purchased shells from South Korea to replenish its own reserves."
The military commentator noted that the Russia-Ukraine war has long turned into a protracted war of attrition. Coupled with nearly two years of ongoing conflict in the Middle East, it has significantly depleted the U.S. military's readiness stockpiles.
"As a key U.S. ally, Australia's GWEO program largely operates in partnership with American defence contractors to produce U.S.-standard weapons. If production is limited to the domestic Australian market, output would be small and costs would rise," he wrote.
"However, by integrating into the U.S. military supply chain, Australia can both help boost U.S. ammunition supplies and reduce per-unit costs — a mutually beneficial outcome for both countries."
US Scepticism an Issue
Carl Schuster, former director of operations at U.S. Pacific Command's Joint Intelligence Center, was more cautious.
"Unfortunately, America's politicians and military industrial see all bilateral and multilateral projects as a loss for U.S. industry," he told The Epoch Times in an email.
Schuster argued for an exception in this case, noting that Australia has stood by the United States in every conflict since World War I.
"No other ally has been that loyal or reliable," he wrote. "Moreover, U.S. industry lacks the employee base to expand at the pace required to be ready in this decade."
"We need and can rely on Australia. The challenge is to identify a convincing political-economic vision in both countries. That means the U.S. and Australian leaders must negotiate a division of labor and the funding to achieve it."
Australia's Minister of Defence Richard Marles (C) and Minister of Defence Industry and Capability Delivery Pat Conroy (R) announce the accelerated delivery of Australia's first High Mobility Artillery Rocket System (HIMARS) at the Australian International Airshow in Avalon on March 24, 2025. Australia's army has received its first delivery of a "game changer" mobile long-range US rocket system, the government said on March 24. William West/AFP via Getty Images
Schuster, an instructor at the Department of History in Hawaii Pacific University, noted the report's did not account for ongoing scepticism towards the U.S.-Australia relationship.
"Much of that is driven by America's poor strategic decisions of the last 20 years (invading Iraq, U.S. policies in Afghanistan that proved a costly failure) and the Obama administration's deliberate ignoring of the Indo-Pacific until the final two year of his administration," he said, adding that in the last two years of the Obama administration, efforts were more statistical (decommissioning units in Europe) than real (no new resources were transferred to the Pacific).
In addition, there was the policy inconsistency.
"The constant changing of policies between consecutive administrations tends to breed distrust and diminish any desire to enter long-term agreements."
Overall, Schuster concluded that the GWEO initiative is good and necessary for both countries, while suggesting closer integration with Japan and South Korea.
"Japanese warships are built with the Indo-Pacific in mind, while European warship designs tend to optimise their designs for operations in the Atlantic and Mediterranean."
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