Topics: Australian manufacturing amid COVID-19
Virginia Trioli: It is a clear and stated bias of mine. I think I was open about that from the day I took this program that ever since my early days as a business reporter, I’m a big fan of having some kind of industry policy, of having a manufacturing base in this country. It’s been a country of great innovation and continues to be. And the so-called manufacturing 2.0, which is the next level of high-tech manufacturing, holds out great promise for economic prosperity, also for training and education and for job security in this country. Alright. That’s my lecture.
But now, with COVID-19, it would seem that politicians on both sides of the aisle are sort of finding their voices on this too. Brendan O’Connor from the Opposition was on this subject on this program yesterday. Karen Andrews is the Minister for Industry, Science and Technology. This actually is her bailiwick and she joins you now as well.
Karen Andrews, good morning.
Karen Andrews: Good morning Virginia.
Virginia Trioli: Let’s talk about opportunities, if indeed COVID-19 presents opportunities for the industry sector. Does it?
Karen Andrews: Absolutely. A lot of work was done last year looking at the manufacturing sector, where our core and traditional strengths had been and what our emerging industries were going to look like. Now, of course, with COVID-19, it’s brought to the front a couple of issues. One is our ability to meet our needs. And I really want to draw the distinction between manufacturing for our wants, which is not going to be realistic and is not going to happen. We won’t be looking to manufacture for our wants because we won’t be able to have the capacity to do it. But what we need to be in a position to do is manufacture for our needs …
Virginia Trioli: [Interrupts] So delineate the difference between those two for us. What you or your government would define as wants versus needs?
Karen Andrews: Okay. The best example probably that most people can relate to is an iPhone. So we’re not looking to start manufacturing iPhones here in Australia, but what we will do is start looking at two specific areas. One is the needs that we’ve identified through COVID, which is the mask manufacturer, whether that’s surgical masks, P2 masks; what we’ve been doing with kits; what we’re now doing with isolation gowns, which is a unique story all on its own. So, they’re the needs.
We can also make sure that we are developing capacity for our emerging industries. Now I’ve talked about space a lot in the past. It’s got a clear plan of how it’s going to triple its size. Agribusiness we are already strong in and we will be able to increase that, we believe, because of the fact that we do have good resources of food. 25 per cent of our manufacturing is currently food and food-related. We need to make sure we have our own food security and then we will look at ramping up even more capacity to meet the needs of our neighbours and quite frankly, globally.
So, our wants are potentially be the iPhone. The needs are what we actually need to protect ourselves in times of a pandemic, for example. And then there’s developing our capability for other industries.
Virginia Trioli: I want to get to the open line in just a moment and hear from the listeners this morning so we’ll keep this tight, Karen Andrews. And they’re all important points that actually require a lot longer to thrash out so we’ll make some time for them.
The problem is though that as a society, even if you put to one side the distinction between wants and needs, we have, as either consumers or as manufacturers or as businesses and creators and inventors, we have become addicted to the low prices and the good economies of scale that you get when you send that job overseas.
Karen Andrews: So I think that the situation which we’ve now found ourselves, both businesses and consumers has been a significant wakeup because there have been difficulties with products and with supply chains. And I think people have understood that …
Virginia Trioli: [Interrupts] But do you think it’s been a wakeup that’s resulted in us turning around and saying: we’re prepared to pay more?
Karen Andrews: Time will tell on that, Virginia. I hope it’s made a difference and I will be constantly reminding people of the needs that they had to take into account, and that is supply chains. So it’s really important that people focus on that. So this is a real opportunity for us. We need to grasp that we need to take it to the next step. And can I leave you with just one observation?
Virginia Trioli: Just quickly.
Karen Andrews: Yes. So we actually struggled a little bit with the mass-produced products like masks. What we demonstrated was our ability to move very quickly for high-tech like ventilators. So I think that’s a very telling point for the future of where we need to target.
Virginia Trioli: Well, we’ll talk about this again, no doubt, Karen Andrews. Thank you.
Karen Andrews: Pleasure.
Virginia Trioli: Karen Andrews is the Federal Minister for Industry, Science and Technology.