As the US economy roars back into rude health, there are huge opportunities for local innovators to benefit from the COVID re-alignment of global supply chains, according to Australia’s ambassador to the United States Arthur Sinodinos.
From critical minerals to an array of emerging technologies and advanced manufacturing, Mr Sinodinos said the Biden Administration’s sober assessment of global supply chains presented significant opportunities for “trusted partners”.
While COVID had created intense scrutiny of supply chains and a focus on creating greater self-sufficiency in the US, there is a recognition that it cannot do everything and there are areas where Australia’s comparative advantage creates opportunity.
Growing geopolitical competition is a clear consideration, and Australia was working through the Quad (the Australia, US, Japan and India strategic alignment) and through the bilateral Frontier Technologies Dialogue with the United States to sharpen those opportunities.
“[There is] a big focus on supply chains and how to reconfigure supply chains given the experience of COVID,” Mr Sinodinos told InnovationAus.
“Some of this is about great self-sufficiency of supply. But the Americans realise they can’t do it all on their own. So, they are looking at trusted allies and partners,” he said.
“They’ve got executive orders to look at five to six areas that includes telecommunications, biotechnology, semiconductor chips, health and clean energy. All of these are areas where the US wants to do more, and we can do more with them.
“It’s actually a huge opportunity for Australian innovators and I’m excited about what we can do.”
Those opportunities would certainly include the production and processing of rare earther and critical minerals, but also potentially using this as the basis for stronger downstream advanced manufacturing, including in areas like electric vehicle production.
Mr Sinodinos said he was working to ensure that the tightened foreign investment rules in Australia did not act as an impediment to investment by American companies that wanted to do more in Australia, particularly when it came to helping Australian startups get going.
While President Joe Biden’s Administration has maintained the same Buy American trade thrust as the Trump Administration – Mr Biden signed a Made in America executive order this year to focus government procurement on local suppliers – Mr Sinodinos was confident this would not impact opportunities for Australian trade.
“There has been a lot of focus on Buy American and this has been extended into this administration, and there have been executive orders whereby if supply chains are reconfigured, how can the US maximise domestic production,” Mr Sinodinos said.
“But they have recognised, even as they have been doing those executive orders, that allies and partners do have a role to play. And it has been explicit for those of us that are in free trade agreements with the US and who are involved with the global procurement agreements through the WTO and others [that] it is not going to infringe on those obligations.
“We recognise that this administration has made election commitments about a ‘middle class’ foreign policy, about how does it make trade policy work for American workers,” he said. “But within that, they recognise the role of allies and partners.”
“So, whether it’s in the defence industry or other sectors they have identified as priorities, we think there is plenty of scope for cooperation.
“And we think that Australia, where we have comparative advantage in a number of areas of science and technology, it is a particularly good time to be engaging with the US.”
You can listen to the full podcast interview with Arthur Sinodinos here.