CANBERRA: Australia has touted plans to boost its arms exports, which are quite meagre compared with its annual defence budget. Despite being the world’s 12th biggest military spender, with a defence budget this year of A$34.6 billion (S$35.9 billion), Australia’s exports last year came to about A$1.5 billion to A$2.5 billion. It is the 20th biggest arms exporter in the world. Mr Turnbull wants Australia to enter the top 10 in arms exports, a list led by the United States, Russia, China, France and Germany. He wants to boost exports to allies and to countries in Asia and the Middle East, but has not set a target amount. As part of this goal, he will set up a A$3.8 billion loan facility to assist arms exporters.
Mr Turnbull said the plan would boost manufacturing skills, create “high-tech, cutting-edge jobs” and help to capitalise on Australia’s investment in the local defence sector.
Business and industry groups have lauded the plan, saying it would help the local sector grow and supply more hardware to the Australian military. But the plan has been heavily criticised by defence experts, who say the nation’s military manufacturing sector is too small and will never be able to compete with large defence producers such as the US, Russia and China. former deputy secretary in the Department of Defence, Mr Fred Bennett, said Australia had little chance of competing in a sector that is fiercely competitive and often involves manipulation and intervention by governments. He said any decision by Canberra to commit funds to the sector is a “dubious investment”. To believe that Australian companies can succeed in this market in the face of the decline of our manufacturing sector under the pressure of relatively high energy and labour costs, a strong currency and adversarial industrial relations is to believe a fairy tale,” he said in a letter to The Australian newspaper on Feb 1. Describing the proposed A$3.8 billion scheme as a “waste”, he added: “No one with knowledge of the global defence equipment market should believe a word of it.” Other experts agreed, noting that Australia should focus on boosting skills in proven sectors such as agriculture and mining. The country has achieved some export successes in the defence sector, mainly with niche products or specialised components and technologies. These include the Nulka decoy missile, which protects warships from anti-ship missiles, and the Bushmaster, a rugged armoured vehicle which has been deployed in the Middle East, Africa and the Pacific. The government’s defence export strategy released late last month shows 47 per cent of military exports go to Canada, New Zealand, the United Kingdom and the US, 26 per cent to the Indo-Pacific region (including Asia), 21 per cent to Europe, 4 per cent to the Middle East and North Africa, and 2 per cent to others.
