By Peter Roberts
We have heard a lot about bubbles travel and otherwise in recent times but few bubbles are as permanent as the complacent view most of have of the strength of the Australian economy.
Yesterday at the MYOB/@AuManufacturing Manufacturing Modernisation virtual event Professor Goran Roos painted a picture not of the advanced nation we imagine, but Australia as a developing country.
Roos, one of the world’s foremost observers of the manufacturing sector, detailed a slide down measures of international competitiveness, economic sophistication, ability to export high value products and the like.
One of the most damning statistics is the measure of exports of complex products.
Australia’s exports include only 2.5 per cent that would be considered complex, compared to the leading manufacturing nation Germany where advanced products account for 28.6 per cent of exports.
We don’t even outscore New Zealand on this measure – their exports include 3.6 per cent complex products.
This is the export profile of a developing economy.
As Roos, a man whose C/V is as long as it is impressive, including several years spent working in Australia, said: “In complex economies exported services are developed as a complement to exported products.
“In non non-complex economies services are developed as a substitute for the lack of exported products.
“Hence prosperous economies are grounded in servitized advanced manufacturing.”
The good news, echoed by MYOB’s Frank Feustal and the Advanced Manufacturing Growth Centre’s Michael Sharpe, is that Covid-19 and industry 4.0 and digitisation offered Australian companies the chance to leapfrog competitors and regain international competitiveness.
Covid has demonstrated the reason we need to grow our advanced manufacturing sectors and digitisation has shrunk the globe and given us the tools to compete.
Sharpe described a hunger among SME manufacturers to adopt digital technologies while Feustal said virtually no SME was too small to benefit from digital technologies such as the cloud.
The challenge is there for our companies to go digital.
As Roos said: “It is no longer a matter of whether you go digital, but how you do it.”
Picture: Goran Roos
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