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The country is heading towards a normalization of its approach to the world, realigning its capabilities with its strategic priorities on two different scales. While, for much of the 20th and 21st century, Australia aimed at being a “global middle power”, Australia is now clearly willing to turn into a “regional power”. It is thus relocating its core national interests towards the “inner ring”, i.e. the South Pacific and maritime Southeast Asia, and to a lesser extent, its “outer ring”, i.e. the Indo-Pacific and the wider world. This will translate into capability choices for the three Australian services, as each of them undergoes a deep shift in its operational horizon. The normalization of Australia will also impact its political strategy, as it seeks to balance the Chinese and American influences through trade and strategic partnerships across the Indo-Pacific area.