French Economic Stimulus supports Defence Industry

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Aussiegunneragain 9/15/2009 7:22:19 AM

France has ordered a third Mistral LPH as well as funded a number of new industry projects with export potential, should we be doing the same?

The sort of thing I am thinking of is a fourth, maybe fifth and sixth AWD, selecting the THALES Copperhead for LAND 121 and advancing the OPV project, maybe even elements of the ANZAC replacement.

Sorry, we've already spent our stimulus money on cash handouts, ceiling batts and on school's that are due to be ripped down. We are also going to fork out another $43 billion on a broadband network that business would build for 90% of Australians anyway, in order to ensure that the remaining 10% of Australians living in the arse end of nowhere can download porn at the same rate as the rest of us. Besides which the RBA is talking about putting up rates now anyway so I don't think another stimulus is in order.

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gf0012-aust 9/15/2009 7:29:17 AM

govt has directed us to save $20bn,

we're not buying anything above existing planned proc

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BLUIE006 9/16/2009 8:23:46 AM

It's a shame because a Defence mini-economic stimulus would have a direct impact on the manufacturing sector and the Australian manufacturing sector has been one of the hardest hit by the GFC and it hasn't received as much support from the Federal Government as other sectors (i.e Construction) .

It would be nice to see a little more of the stimulus going into programs to encourage greater private spending on R&D and High Tech Manufacturing.

* We have the raw resources ... increasing our ability to add value to them makes sense for long term economic growth. Doesn't it?

* I have always struggled with the idea, that we sell resources to people for them value add them, and, then sell them back to us.

There are a number of future challenges for the Australian manufacturing sector. The most pressing is the current global financial crisis. During an economic downturn, manufacturers face the challenge to contain costs and often the response is to reduce workforce numbers, cut R&D spending and outsource non-core operations. While this may help contain operational costs now, when the next growth cycle starts, it is not always possible to ramp up the workforce quickly, particularly where skilled labour is involved (.e Defence & technology sectors).

Source: Engineers Australia

N.B. France isn't the only one to inject money into defence as part of their stimulus a number of other developed & developing economies have done so, a notably example in our region is Malaysia h**p://www.prlog.org/10292777-portion-of-malaysias-myr7bn-economic-stimulus-package-earmarked-for-defence-ministry.html

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Volkodav 9/18/2009 6:24:23 AM

What I was thinking was we are buying protected trucks anyway we might as well support the local product in the Copperhead and enjoy the payoff in terms of support costs, maintaining an existing work force and hopefully gaining exports once production has been kicked of by the initial order.

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Aussiegunneragain 9/19/2009 6:48:59 AM

Yeah, lets throw more money at the uncompetitive Australian auto sector instead of running a competitive tender which would probably result in us getitng a cheaper, better product from overseas or at least a local firm ever looks up from the taxpayers tit long enough to do what is necessary to become competitive. No thanks, I'd rather we bought the most cost effective option and directed the savings into corporate tax cuts. In recent years our corporate tax regime has declined from about the 8th most competitive in the OECD to the 21st. Corporate taxes are amongst the most inefficient and economically damaging types of taxes that exists, so if you want to know why manufacturers don't set up here nowdays then you might start there.

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Aussiegunneragain 9/19/2009 6:50:31 AM

Yeah, lets throw more money at the uncompetitive Australian auto sector instead of running a competitive tender which would probably result in us getitng a cheaper, better product from overseas or at least a good local product if a local firm ever looks up from the taxpayers tit long enough to do what is necessary to become competitive. No thanks, I'd rather we bought the most cost effective option and directed the savings into corporate tax cuts. In recent years our corporate tax regime has declined from about the 8th most competitive in the OECD to the 21st. Corporate taxes are amongst the most inefficient and economically damaging types of taxes that exists, so if you want to know why manufacturers don't set up here nowdays then you might start there.

Typo corrected.

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Volkodav 9/19/2009 8:07:37 AM

Interestingly AG the Copperhead is probably one of the better vehicles on the market and definitely a cut above the BAE proposal that won the original tender for LAND 121 before shaking it's self to pieces during endurance testing resulting the current retender process. If it is beaten it will be on price by one of the designs that has been subsidised by massive orders from their home government.

If you were a Digger operating in Afghanistan would you rather be driving a tarted up armoured BAE / Stewart Stevenson or better a purpose designed Copperhead 4x4 or 6x6.

Just because something is used by the US, UK or who ever, doesn't mean it is the best there is let alone the best option for us. All you need to do is read some the material on the ongoing controversies over procurement in the US and UK to realise that many of the off the shelf options we are looking at are not very well regarded by their own Military.

Some times the home grown option is the best option for us.

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gf0012-aust 9/19/2009 8:31:39 AM

All you need to do is read some the material on the ongoing controversies over procurement in the US and UK to realise that many of the off the shelf options we are looking at are not very well regarded by their own Military.

Some times the home grown option is the best option for us.

am witnessing some of this at the moment. some senior sirs get wound up by the powerpoint presentation and hoof off to the UK. this is despite feeds coming from the pommy operators using it in the field that its shyte. the same old mistake, listen to powerpoint and salesmen and don't listen to the people who use it.

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Aussiegunneragain 9/19/2009 7:17:36 PM

Just because something is used by the US, UK or who ever, doesn't mean it is the best there is let alone the best option for us.

I never said that they were. If an Australian product can win a tender on a level playing field then I have no problems with the ADF buying it, I just have a problem with the premise of your argument that because something is a local product we should buy it to prop up the local economy. There are better ways to improve our economic performance and to equip our military than that.

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Volkodav 9/20/2009 7:39:49 AM

Fair enough, but each of the options I listed would result a significant increase in capability for the ADF. Sustaining Australian industry and boosting our economy is a bonus but what I really want to see is extra AWD's, new FFG's and OPV's with the RAN and Copperheads replacing Mogs.

3 AWD's isn't enough, the midlife update on the ANZAC's is good but won't give them the capability we are now seeking and the Armidales are being worked quite hard at the moment and an early replacement may be on the cards. Add to that the no brainer of going for the Copperhead, based on the proven Bushmaster, for LAND 121 over foreign designs that have exhibited serious durability issues off road in Afghanistan.

Basically a regional air to air threat that will be too much for our SH's and HUG Bugs to handle is still a long way off but new gen AIP subs are already being delivered, terrorist bases already exist, maritime security threats already exist and our troops are already operating against IED threats.

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