The New Zealand navy ship HMNZS Aotearoa (centre) navigates in the South China Sea while conducting exercises as part of a multilateral Maritime Cooperative Activity between Australia, New Zealand, the Philippines and the United States, October 30, 2025. LSA Jess Muir/Australian Department Of Defence/Handout via REUTERS
By Michael Heath
May 23, 2026 (Bloomberg) —New Zealand intends to spend about NZ$1.6 billion ($936 million) on drones, ship maintenance and naval upgrades to bolster the island nation’s maritime security at a time of increasing concern about supply routes.
Defence Minister Chris Penk said Saturday that the government will invest in two types of drones: one for the southwest Pacific to provide long-duration intelligence, surveillance and reconnaissance; the other is a polar-capable vehicle that can operate from naval vessels in the Southern Ocean.
“New Zealand’s prosperity and security depend on the sea,” Penk said in a statement. “Recent events have served as a reminder of how quickly disruptions to international shipping routes can affect economies and supply chains across the globe. The oceans are not a barrier to danger, but a vital national interest that must be actively secured.”
New Zealand will hand down its annual budget next week.
The government plans to lift defense spending to about 2% of gross domestic product from around 1% at present in response to rising geopolitical tensions. Penk, who served in both the New Zealand and Australian navies, told Bloomberg earlier this month that the government is open to expanding its frigate fleet from the current two vessels.
Penk said Saturday that the budget would provide for maintenance on the navy’s Anzac-class frigates and HMNZS Canterbury, to extend the life of the existing ships until they are replaced.
The South Pacific is becoming increasingly contested as China’s military power swells to reflect its massive economic might, while the US and its allies aim to counter Beijing’s moves. In February last year, Chinese warships conducted live-fire drills in the Tasman Sea between Australia and New Zealand with little warning.
© 2026 Bloomberg L.P.
This article contains reporting from Bloomberg, published under license.
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The New Zealand navy's largest ship encountered a Taiwanese warship as it sailed through the sensitive Taiwan Strait last month, the country's armed forces said on Tuesday, as they published a rare picture of what happened.
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