Australia will spend about $300 million participating in an international effort to upgrade navy missiles.
The decision to continue in the NATO Seasparrow Consortium's Evolved Seasparrow Missile program paves the way for Australian navy warships to be better protected against the threat of anti-ship missiles, Minister for Defence David Johnston says.
The government will sign a memorandum of understanding with the consortium with funding of about $300 million allocated to support Australia's involvement.
There will be opportunities for Australian industry to compete for work in the development, production, integration and through-life support of the upgraded missiles, Senator Johnston said in a statement on Sunday.
The government expects to make a final decision on procurement of upgraded missiles about 2020.
Countries in the NATO Seasparrow Consortium are: Australia, Belgium, Canada, Denmark, Germany, Greece, Netherlands, Norway, Portugal, Spain, Turkey and the United States.