What effect has the Covid pandemic and the war in Ukraine had on Australian Industries and supply chains?
Australia had a strong manufacturing base going back to the early days, but it seems in recent decades, that the base has been gradually eroded.
Let’s look at some examples:
China supplies everything from clothing, household whitegoods, cars, and mining equipment to the detriment of local industries here in Australia. It has seen the closure of the local car manufacturing plants, foundries, heavy engineering, and shipyards.
As we can see with the war in Ukraine, countries in Europe are reliant on Russian gas through the Nord Stream pipelines. The effect of the war in Europe, on ordinary working people, (not discounting the sacrifices of the Ukrainian people), has been enormous.
In the USA, UK and many European countries, the damage to economies is astonishing. Germany’s and Western Europe’s reliance on Russia for energy supplies has left them vulnerable to the whim of Putin. All this has led to higher petroleum and grocery prices worldwide. Inflation is now a dirty word.
All this upheaval has taken its toll on the Global supply chain. So, Should Australia be self-reliant?
Once upon a time, heavy industry was a source of pride for Australia’s self-reliance, especially after World War II. Australia has been affected by Chinese exports like most countries around the world in the last few decades. Nowadays, we have low petroleum supplies and refineries have closed. We only have a couple of months supply in advance. Does that make sense to anyone?
Since the pandemic hit, more people have begun to realise that Australia is vulnerable to overseas supply chain continuity, and it looks like it’s getting worse. The war in Ukraine and the Chinese agreement with the Solomon Islands to build Naval Facilities has set the alarm bells ringing.
There are now moves at Federal Government levels to increase funding to manufacturing industries and encourage homemade supply. We can see it starting to happen, with the largest flu vaccine manufacturing plant in the southern hemisphere to be built in Melbourne. This is an effort to secure Australia’s stockpile of critical vaccines and antivenoms in the future. It will be funded through a joint venture with the Federal Government, who are putting $1 billion towards the project. Though we can see it beginning to benefit industries such as:
- Resources Technology & Critical Minerals Processing.
- Food & beverage.
- Medical products.
- Recycling & clean energy.
This needs to increase rapidly!
The global supply chains are already struggling and may not ever return to what they once were. Even buying a new car, means a long wait for delivery of the vehicle. We really have been caught short.
Maybe the benefits of the hideous Covid Pandemic can lead us to self-sufficiency. It has been a wake-up call for our politicians and defence forces and this is now affecting us in our own backyard.
White Industries are getting an ever-increasing number of enquiries from companies who used to get their castings from overseas now looking to source locally. The pendulum is starting to swing back the other way.
Australian companies can play their part, by supporting their local manufacturing companies, like White Industries as much as possible. Our staff are waiting to help with your enquiries at any time. Let us hope we can be self-sufficient once again!