Prime Minister Kevin Rudd has suggested moving the Garden Island naval base in Sydney to northern Australia, as part of a reassessment of Australia's military strategy in the Asia-Pacific.
As Amanda Cavill reports, Mr Rudd made the proposal in a foreign policy speech to the Lowy Institute, in the lead up to next week's election.
The Prime Minister says it has been a good year for Australia, which has now a seat on the G20 group of countries and will take over the chair of the United Nations Security Council this weekend.
He says Australia's enduring national interest and its wider role in the world as a comfortable middle power will be well served by its involvement with these bodies.
"For the first time in our history we sit on both the premier institution of global security and the premier global institution for the management of the global economy. This is a good achievement for Australia. These are achievements of which all Australians should be proud. This is our role in the world both in its security dimensions and its economic dimensions. "
Mr Rudd also used the speech to outline proposals for the rest of the world to step up to engagement with China.
He says the way should be left open for China to join the Trans-Pacific Partnership, which aims at both reducing tariffs and addressing emerging trade issues.
It is currently made up of the United States, Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam and most recently Japan.
Mr Rudd also called for the East Asia Summit to include a new regional disputes mechanism.
He says Australia needs to work with others in the region to build collectively a shared political, economic and security agenda and a sense of common security across our wider region.
"You can't have economic prosperity in the absence of strategic stability. The stability of our Asia Pacific region is not assured. The Korean peninsula is the most heavily-armed military theatre in the world today. In the East China sea, the Diaoyus and Senkaku Islands is impacting the political and economic relationship between China and Japan. The region of the South China Sea is more unstable than it has been at any time over the last 40 years."
Mr Rudd says Australia will need to review its defence and security, considering its close ties and proximity to the rapidly-growing Asian region.
He says it may be advisable to move the country's main east coast naval base from Garden Island in Sydney.
"This interests in the shift of power in our region reinforces the need for an Australian posture that supports, number one, Australian Defence Force operations in Australia's northern approaches. Number two. Humanitarian and disaster relief operations and stabilisation operations in our neighbourhood and, number three, enhanced co-operation with the United States and regional partners. This will require further enhancing the capapbilities of the Australian Defence Force and most particularly the Royal Australian Navy."
Mr Rudd says moving the naval base from Garden Island could potentially create new jobs created in Brisbane and other centres, such as Darwin, Townsville, and Cairns.
He says the relocation could be complete by 2030.
However, New South Wales Premier Barry O'Farrell says it would be devastating for the state's economy and navy families.
Garden Island injects about $470 million a year into the state economy and employs 6700 people, including up to 4000 on the base.
Opposition frontbencher Malcolm Turnbull, whose electorate takes in Garden Island, has described the proposal as a desperate effort by the Prime Minister to shore up support in Queensland.
