US won't exit South China Sea: Beazley

Australia should warn the Chinese the Americans "aren't going away" when it comes to the dispute over the South China Sea, former ambassador to the US Kim Beazley believes.

Mr Beazley says it's time for the Chinese to understand the US is capable of creating an "urgent" situation and won't run away from the territorial dispute.

"We're always talking about us understanding the Chinese, now the time has come for the Chinese to understand the United States," he told a conference on defence strategy in Canberra on Thursday.

"Every step that is taken that militarises the area creates a much higher level of risk."

He believes the Chinese need to "think very hard" about US capacity in the region.

"We need to say to the Chinese, the Americans aren't going away," he said.

"They have a mission ... their freedom of navigation."

In one of his first public addresses since returning from his post as US ambassador, Mr Beazley outlined his own strategy for dealing with the escalating situation.

The former defence minister believes Australia could "appear normal" by sending P-3 patrol aircraft into the region.

"Without talking about them, just do them (the patrols)," he told the Australian Strategic Policy Institute dinner.

"That would be, I think, the way I would go, but that's just me and I am now no longer influential on anything."

The difficulty with Australia following the US lead and sending ships through Chinese-claimed areas was media exposure.

"The Chinese nose is going to get rubbed right in it," he said.

"It would be easier if we just kept doing things and not ever talking about them."

Mr Beazley also reflected on the US involvement in Syria and Iraq, saying it was Southeast Asia that was a priority area.

"Don't worry about what you see in the Middle East," he said.

"When it comes to the force structure, the Americans can do the Middle East standing on their heads."

He believes the US has a valuable ally in Australia in the Southeast Asian region.

"Now what we do, what we say, what we think here matters because the US are going to operate here," he said.

He stressed the importance of defence strategy, saying it should be the first priority of governments, but acknowledged times had changed since he was defence minister.

He conceded he was allocated billions more in funding each year than current ministers and was given total control of spending.