New form layout: How to change the default selection in state field?

Question 4: I live in Australia. In the shipping field I would like to use the State field but I can not change it to the Australians States. I decided to removed this field, but when I arrive to the previous and submit, there is a line saying Alabama, United States! How can I remove this, or how I can get the Australian States instead of the United States?

You can use the "All States and Cities" widget and write "Australia" as the only country to be shown.