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Wednesday, 24 August 1994
Page: 292

(Question No. 1489)

Senator Jones asked the Minister for Industry, Science and Technology, upon notice, on 27 June 1994:

  With reference to British Aerospace Australia (BAeA) signing an agreement with Codar, a subsidiary of the US company NAI Technology Inc., to manufacture their eagle series rugged high resolution colour monitors:

  (1) What are the special characteristics of the colour monitors;

  (2) Do the monitors have any specific benefits for Australia's defence industry exports;

  (3) Will the granting to BAeA of exclusive manufacturing rights to eagle monitors in Pacific Rim countries result in increased employment opportunities;

  (4) What is the present value to Australian trade of our information technology industry;

  (5) How many information technology industry companies have, in 1994 announced that they will begin manufacture in Australia; and

  (6) What is the value of this anticipated production, and how many jobs is it expected to create.

Senator Cook —The answer to the honourable senator's question is as follows:

  (1) I am informed that the eagle series rugged high resolution colour monitors have a number of special characteristics which distinguish them from a standard PC monitor. Standard PC monitors are not generally regarded as suitable for the rigours of many defence and mining type applications. During their manufacture eagle monitors are "ruggedised". That is, they are specifically designed to withstand severe shocks, vibration, moisture and they are also magnetically shielded for security purposes. Typically these monitors are installed in tanks, trucks, patrol boats and military aircraft.

  (2) Yes. As a result of the agreement Australia's export potential of defence industry products is significantly enhanced. I believe that under the exclusive rights agreement, which BAeA has secured, all Codar eagle series monitors sold by Codar or BAeA into any Pacific Rim country will be manufactured in Australia by BAeA. Sales of eagle monitors may also enhance the sales of more sophisticated and related BAeA products such as operating consols.

  The import replacement potential of the Australian produced eagle monitors in Defence Department contracts is also significant with tenders such as the Minehunter and P-3C both requiring the supply of "ruggedised" monitors.

  (3) Yes. I am informed that the manufacture and sale of the eagle series monitors and associated equipment will be undertaken at BAeA's Salisbury (SA) facilities, and in time, could provide work for up to 30 employees. The manufacturing process associated with the monitors involves electronic assembly, integration and performance testing but will also incorporate some mechanical manufacturing work.

  (4) The information technologies sector is one of the fastest growing and most dynamic sectors of the Australian economy, valued at $A11.2 billion in 1993 (2.1% of GDP) and forecast to grow to $A17.7 billion by 1998. Currently, Australian information technology exports are round $A1.4 billion annually, and growing strongly. These exports represent around 2.1% of total exports of goods and services for the financial year to date April 1993/94. The Australian Information Industry Association (AIIA) reports that its members' imports of information technology goods and services have increased by some 8 per cent over 1992/93 figures, in line with market growth, to around $A2.3 billion. These imports represent around 3.35 percent of total imports of goods and services for the financial year to date April 1993/94.

  (5) For the financial year 1993/94 twelve international and four Australian information technology and telecommunications companies joined the Partnerships for Development (PfD) and Fixed Term Arrangements (FTA) Programs. Manufacturing formed an integral part of some companies' agreements. A number of international and Australian information technology and telecommunication companies have expressed an interest in joining the program in 1994-95 and it is expected that manufacturing activities will form part of their industry development undertakings. The Department of Industry, Science and Technology manages these programs which encourage international companies in the information and telecommunications industries to invest in commercially sound activities in Australia. Indigenous Australian companies which wish to have their growth potential recognised and which view a closer working arrangement with the Government as strategically important can also enter a Fixed Term Arrangement.

  (6) Exact figures relating to the number of people employed as a result of these activities are not available but the agreements are expected to substantially increase employment in the sector. The anticipated value of activities proposed by these companies for 1994 will amount to $A104 million of export income and $A33 million of direct investment and technology transfer. In 1993/94 Partnership companies reported exports of approximately $1.2 billion and research and development invested in Australia of $300 million. This is a sixfold increase on the 1988 levels when the first agreements were signed.