Expert analysis on Australia’s economic security challenges in 2025.

Australia’s economic security landscape has seen a significant shift over the past year, with a growing focus on issues such as industrial policy, supply chain security, and technology derisking. The United States Studies Centre recently gathered a group of experts to discuss Australia’s response to economic security challenges, highlighting trade and investment, industrial policy, critical minerals supply chains, and technology derisking as key areas of concern.

The global push towards economic security measures has been largely driven by China’s actions in the market and its use of economic coercion. The United States has also played a significant role in shaping economic security policies, with the introduction of tariffs in 2017 and technology controls in 2022. The intensifying competition between the United States and China has prompted many countries to reassess their economic security strategies, leading to a global shift towards more protective measures.

Australia, as an advanced, trade-exposed economy, is faced with the challenge of balancing its commitment to free trade with the need to enhance competitiveness through industrial policy. The government’s ‘Future Made in Australia’ industrial policy and the ‘National Interest Framework’ are key initiatives aimed at promoting economic growth while safeguarding national security interests. However, there is notable divergence in approaches to economic security between Australia’s political parties, particularly regarding energy policy.

The Australian economy is also grappling with various funding pressures, including the costs of national defence, investments in the care economy for an ageing population, housing accessibility, and the energy transition. The outcome of the upcoming federal election in May 2025 is likely to influence how Australia addresses these challenges and strikes a balance between national expenses and economic security priorities.

In 2025, Australia’s economic security agenda will focus on reducing exposure to trade and investment risks, reshaping the economy through industrial policy, diversifying critical minerals supply chains, and addressing technology security and competition. These priorities reflect the country’s efforts to adapt to a rapidly changing global economic landscape and ensure its long-term prosperity and security in an increasingly interconnected world.