Exports critical for Australia’s defence industry
19 Oct 2018|

The federal government’s defence export strategy, released in January 2018, is paving the way for a new era of success for the Australian defence industry. A key element of the strategy will be pairing strong advocacy of Australian industry with a clear, consistent and well-resourced defence export control regime to manage the export permit process.

Given the relatively small domestic requirement to supply the Australian Defence Force, exports are critical in expanding and lifting the global competitiveness of the industry. This is important not only for business, but also for the industry’s ability to deliver even more competitively to the ADF.

The vision set out in the strategy to become a top-10 defence exporter is ambitious but achievable. It will require continued leadership from the government and the Department of Defence, appropriate policy settings and strong advocacy.

Our successful international counterparts, particularly the UK and European partners, support their industries and back home-grown capabilities to export markets around the world, seeing this as an important part of the defence and industry partnership. In the best cases, they take a whole-of-government approach, engaging trade, investment and other portfolios.

The Australian Industry Group Defence Council commends the government and Defence on the recent approach to defence exports, including the strong advocacy for Australian products and services overseas, as well as the establishment of a suite of policies and programs to support our industry. The government has also appointed our first Australian defence export advocate.

Australia has already proven it can take on the best in the world. We have designed and built world-beating radar (the CEAFAR active phased array radar), as well as other world-class capabilities—from armoured vehicles designed and built by Thales to ships designed by Austal. Defence exports aren’t confined to military equipment, but importantly also include services such as testing and evaluation.

Another critical avenue for accelerating our success is joining supply chains for projects such as the joint strike fighter. Given the global nature of both the defence markets and most of the prime defence companies, a key element for success is developing local capability that is exportable and connected with global supply chains and markets. This also positions Australia well to capitalise on future aerospace programs, such as the replacement of the Hawk lead-in fighter in the 2020s.

Advocacy through the defence export strategy is critical for the industry. Another crucial element is a clear, consistent and well-managed defence export control strategy. At present, the rollout of export controls for the strategy is in the capable hands of the Defence Export Controls branch in the Department of Defence.

DEC is a small organisation, consisting of committed individuals dedicated to working with industry and delivering the defence export control regime on behalf of the nation. DEC is to be commended for the industry outreach, education programs and assistance it provides to defence industry in the complex business of providing defence exports.

DEC processes around 4,000 export applications a year, including applications for specialist military equipment and commercial products that may be adapted for use in a military program and other sensitive exports such as weapons for sporting purposes. Australia’s export control policy is based on five criteria stemming from various legislative instruments and international regimes: international obligations, human rights obligations, regional security commitments, national security requirements, and foreign policy obligations.

As we grow our defence export market through the defence export strategy, it’s critical that we do so in compliance with our regulatory obligations. The Ai Group Defence Council recognises the importance of establishing robust defence export controls and assisting Australia to meet its international obligations. The council’s national executive has developed a statement on defence exports setting out its understanding of:

  • the important role defence exports play in building defence capability and growing Australian industry, while also providing significant benefits to the broader Australian community
  • the special responsibility of defence exporting countries
  • the government’s role in regulation to enable the export of defence and strategic goods consistent with Australia’s national interests and international obligations.

The national executive is committed to understanding and keeping abreast of Australian defence export control policy, legislation and regulations; understanding the criteria the Australian government uses to assess the exportability of defence and strategic goods; working closely with the Defence Export Controls branch; and recognising the importance of sensitive technologies.

For Australia’s defence export strategy to be effective, all players must understand not only the important part defence exports will play in building our capabilities and industry, but also that they reflect the key tenets of Australia’s foreign policy.

While DEC plays a central role, other government agencies have significant parts to play in reviewing the export permit system against our international obligations. According to the DEC website, only around 6% of permits are sensitive or complex. It’s critical that DEC and the other relevant government agencies are properly resourced and managed to fulfil their roles in implementing the defence export strategy.

The Australian defence industry stands ready to work with government to ensure the effective implementation and success of the strategy, understanding the importance of advocacy and of meeting Australia’s international obligations.