SME defence companies the key to AUKUS success – report

Defence SMEs are essential to the economic success of the AUKUS partners Australia, the UK and the US according to a just released white paper.

The report, by the CEO of defence consulting firm ADROITA Sarah Pavillard, said while defence needs were core to AUKUS, industry in the three countries needed to reach out to make the pact an economic success.

In February Pavillard wrote an article in @AuManufacturing examining the opportunities opening up for defence industry.

In the white paper, Micro-Partnerships in the Age of AUKUS, she said: “SMEs are essential to the economic success of the AUKUS partners—they are the entrepreneurial backbone of the AUKUS economies; creating jobs, driving innovation, and making an outsized contribution to their country’s GDPs.

“SMEs also promote competition, leading to increased productivity and efficiency, benefiting consumers, customers and the broader economy.”

SMEs are Australia’s largest employer, accounting for over seven million jobs, or 60 per cent of total private sector employment, and 35 per cent of the Australia’s GDP.

“AUKUS creates an unprecedented opportunity for development of Australia’s military and defense industrial capability, and for collaboration, cooperation and co-working between Australia, American and British business.

“These opportunities are not just vested in the prime contractors and mega-businesses in the defense sector—they represent a significant growth potential for small to medium businesses through AUKUS-enabling and AUKUS-enabled micropartnerships. ”

Pavillard said partnerships between SMEs were powerful and have the potential to deliver ‘bang for buck’ — big results for relatively small investment.

“Now, more than ever, Australian, American and British SMEs need to collaborate, cooperate, and co-work globally to become stronger, more resilient, and to open up new revenue streams.

“…The AUKUS partnership will be enabled by, and needs to enable, AUKUS micro-partnerships not just AUKUS mega-partnerships to fully catalyze the potential for all levels of these economies to contribute Australia’s capability, and the regional security of the Indo-Pacific.”

Pavillard said that SMEs faced common challenges that require regulatory, policy, and political intervention if AUKUS is to truly succeed. However this need was eased by business-to-business cross-border partnerships.

Further reading:

Picture: Sarah Pavillard

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