Australian Naval Procurement Cycles: Lessons for Other Small Countries

Abstract

Defence procurement agencies in smaller countries, such as Australia, face a difficult challenge when seeking to acquire new weapons systems that are either intrinsically complex or idiosyncratically tailored to local needs. If they seek to rely on production in-country, they must draw on domestic infrastructure almost certainly too limited in its technological breadth and depth for the task of efficiently producing a wide range of sophisticated military products, which are likely to be internationally uncompetitive, into the bargain. If they "leave it to the market" and award contracts on the basis of a competitive process and set up arms-length relationships to pursue compliance, they may find themselves hostage to suppliers that cannot be replaced once the contract is under way. If, instead, they seek supplies from government-owned arsenals and shipyards, they may find it difficult to resit political pressures to preserve legacy sectors, facilities and products. And, if they look to overseas suppliers to meet their requirements, they usually lack the market power to negotiate favourable terms and sometimes to have their requirements met at all.�