CANBERRA (BLOOMBERG) - The Australian government will spend at least A$10 billion (S$10 billion) building a new base to house a future fleet of nuclear submarines, as Prime Minister Scott Morrison warns that the Ukraine war will "inevitably stretch" to the Indo-Pacific.
Mr Morrison announced the project, the first construction of a major new base in Australia since the 1990s, in a foreign policy speech in Sydney on Monday (March 7). The Defence Department has selected three possible east coast locations for the submarine facility - Newcastle and Port Kembla in the state of New South Wales and the Queensland capital of Brisbane.
In his speech to the Lowy Institute, Mr Morrison warned against rising militarisation and attacks on liberal democracies in the Asia-Pacific region, saying "Australia faces its most difficult and dangerous security environment in 80 years".
"A new arc of autocracy is instinctively aligning to challenge and reset the world order in their own image," he added.
News of the base comes as Mr Morrison seeks to burnish his national security credentials ahead of an election that must be held by the end of May, with the Prime Minister's centre-right Liberal National coalition badly trailing the opposition Labor Party in opinion polls.
Australia is planning to build and begin operating a fleet of nuclear submarines in the coming decades with the assistance of the United States and Britain, under the landmark Aukus agreement that was signed in September last year. The new defence capacity could allow Australia greater ability to project force throughout the Asia-Pacific region.
No announcement has been made yet on whether Australia will be using a British or US design for its submarine fleet, or how it will train its navy in the new technology.
Speaking to the Australian Broadcasting Corporation on Sunday, Defence Minister Peter Dutton said there would be an announcement on the design "within the next couple of months".
Australia already has one submarine base on the country's west coast, where its ageing fleet of Collins-class submarines is based. Mr Morrison said the west coast base will continue to operate even after the new facility is completed.
The initial work on the new facility is expected to be finished by the end of 2023, according to the government.
"There will also be significant benefits for local and national industries in supporting the new base and the more complex and larger nuclear-powered submarine fleet," Mr Morrison said.