Boosting Australian Tech for Economic Growth

Australia is stepping up efforts to promote locally made products overseas while ensuring local industries get a fair chance in government procurement. A $5 million investment aims to promote the Made in Australia logo in Asian markets, while new procurement guidelines remind federal agencies to consider the national economic benefits of their spending decisions. The first industry to see tailored advice is technology - an acknowledgment of its crucial role in global competitiveness.

The need for these changes is becoming increasingly urgent. Australia's ranking on the Harvard Economic Complexity Index dropped from 55th in 1995 to 102nd in 2024, showing a concerning decline in economic diversity. Meanwhile, national investment in R&D has fallen from 2.24% of GDP in 2009 to just 1.6% in 2022. Policymakers are responding by prioritising industries that could reverse this trend.

Technology industries play a key role in fostering innovation and economic growth. ICT is the second-largest non-commodity export after education and accounts for 18% of business R&D investment, second only to manufacturing. With strong links to economic resilience, expanding this sector is vital for Australia’s future. However, many local tech companies struggle to gain recognition at home, facing procurement barriers that favour overseas suppliers.

A major part of the issue has been the influence of large consulting firms, which have deep ties with overseas technology companies. Parliamentary inquiries in recent years have exposed conflicts of interest that led to local businesses being overlooked. With the latest government initiatives, there is hope that cultural shifts in procurement will give Australian tech firms a better chance.

Government leadership will be key in driving change. As decision-makers emphasise the importance of supporting local industries, procurement policies should start reflecting a preference for homegrown innovation. With parliamentary support across party lines, recent reforms signal a long-term shift that could continue, regardless of future political changes.

Source: The Australian, TechRepublic