Address to AustCham Singapore

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The Hon Christopher Pyne MP

Minister for Defence Industry

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18 January 2018

It’s a pleasure to be here today.

I am aware of the important role the Australian Chamber of Commerce plays in advancing cooperation between Singapore and Australia.

The Chamber’s rich history reaches back to 1977 and I know you have always been dedicated to maintaining strength and vitality in the relationship between our countries.

Events like this one today are an excellent opportunity to get together and work out how to take the relationship forward in a modern global context.

We in Australia have been friends with Singapore for a very long time.

I was reminded only recently of just how far back this friendship goes.

As you know, in my own portfolio as Minister for Defence Industry, I am involved on a daily basis with submarines.

Australia is commissioning 12 new ones, and I’ll talk about those shortly.

But I was fascinated just before Christmas, as I’m sure you were, by the stunning discovery, by a determined search coalition, of the wreckage of Australia’s first ever Royal Australian Navy submarine, the HMAS AE1.

The search for the AE1 and its 35 crew had gone on for over a century. We never really understood what caused her to disappear off Papua New Guinea in August 1914.

HMAS AE1 and her sister vessel HMAS AE2 had been a controversial acquisition for a very young Australian nation when the E-Class submarines were ordered from Britain in 1910.

Soon after the outbreak of war in August 1914, with only a few months of service, she vanished while on patrol off the Duke of York Islands near Rabaul.

The event cost all hands their lives and struck at the hearts of their families, but also at the Australian nation in its earliest days.

Last December’s discovery, 103 years on, reveals her loss was in all likelihood a catastrophic accident.

We are yet to fully understand what specifically caused her to disappear into the sea mist, but the story will be told soon enough.

I mention it today because there is a Singaporean connection to this story.

On the 2nd of March in 1914, HMAS AE1 and AE2 left on their delivery voyage from Portsmouth, some 15,000 kilometres from here. After a slow and difficult voyage, they arrived in Singapore in late April 1914.

Theirs was a pioneering expedition of staggering proportions and a credit to the crew.

The submarines were beset by mechanical and other problems.

They travelled under escort and sometimes under tow for a total of 20,000 kilometres.

They reached Singapore via Malta, the Suez Canal and Colombo, and arrived here on the 21st of April 1914.

The Submarine Institute’s records note that conditions aboard the two vessels were extremely demanding, with crew enduring temperatures of up to 38 degrees Celsius inside a 54-by-seven metre frame.

On arrival in Singapore the vessels met up with their Australian escort ship waiting here in port, the HMAS Sydney. She could afford the crew little relief in the way of comfort.

So with no room for other crew aboard the Sydney, the men were to remain aboard their vessels while in port.

At 8.30am on the 25th of April 1914, HMAS Sydney escorted AEI and AE2 from Singapore,

The convoy headed to Sydney via the Lombok Strait.

The departure date of the 25th of April is one, of course, very familiar to us.

A year later, to the day, ANZACS would storm the beaches of the Gallipoli Peninsula.

Poignantly, AE2 would join that battle, breaching Turkish defences to do sterling service in the Sea of Marmora, before being sunk herself in April 1915, but this time with no hands lost.

Over a hundred years on, Australia and Singapore, now modern nations in a very different global and regional context, enjoy a strong and vibrant relationship.

This is due in no small measure, to Australia’s recognition of Singapore as an independent nation in 1965.

We were the very first country to do so.

An integral part of my role as Australia’s Minister for Defence Industry is helping to ensure that our international relationships, forged in shared experiences, are nurtured and maintained.

I know this is also what motivates so many of you in the Chamber of Commerce.

Fortunately, Australia and Singapore continue to see the world in similar ways.

We share common interests in regional peace, stability, and economic prosperity

Our economic and commercial ties run deep.

Singapore is Australia’s largest trading partner in ASEAN, and our seventh largest trade partner overall.

Two-way trade in 2016 was valued at around 23 billion dollars.

Australian businesses are active in Singapore in road transport, construction, engineering and Defence.

Singapore offers a huge amount to Australia, especially in service and investment sectors.

Our economic links have been strengthened again by the Singapore-Australia Free Trade Agreement of July 2003.  This is Australia’s second-oldest free trade agreement.

Importantly, the links between our countries extend far beyond trade. We have strong and enduring ties secured through people-to-people relationships.

The Singaporean community in Australia stands at over 50,000 and more than 100,000 Singaporeans are alumni of Australian universities. Some of Singapore’s most outstanding citizens were supported through Australia’s original Colombo Plan.

Our New Colombo Plan has seen around 1,000 Australian students being supported to study in Singapore between 2014 and 2017. 

Singapore is Australia’s fifth largest market by short-term visitor arrivals, and seventh most popular short-term destination.

In Defence, we are both members of the Five Power Defence Arrangements, which originated in 1971. 

In 2015, Australia and Singapore committed to a Comprehensive Strategic Partnership.

It covers the economic, mutual and Defence-orientated links between our countries, and outlines an ambitious, shared vision for the future.

The economy of the Indo-Pacific region is growing rapidly.

The 2016 trade between Australia and ASEAN countries accounted for over 93 billion dollars in total trade.

The trade figure is even higher than our trade tallies with the United States and Japan.

It is a figure that will grow further in the years ahead, and present huge opportunities for Australian businesses. 

The strengthening of the Singapore-Australia Free Trade Agreement was our most comprehensive update to an Australian free trade agreement to date.

Singapore is one of the world’s most attractive places to do business and the changes mean Australian business people will be able to work and stay here more easily.

Investors and exporters will benefit. New opportunities will open up for Australia’s world-class education and service sectors.

New rules of origin will enable Australian companies to leverage Singapore’s position as a gateway to South East Asia and export to the region more readily.

We are deepening cooperation in innovation and science, recognising that these fields are vital to dynamic economies.

In May 2016, as Minister for Industry, Innovation and Science, I announced that Singapore would be the location of one of five start‑up ‘landing-pads’ under the National Innovation and Science Agenda, to promote innovation and entrepreneurship.

The ‘landing-pad’ continues to bring together start-ups, research institutions, multinational corporations and leading technology players.

All of these elements, working together, mean our nations can seize the opportunities on offer in a rapidly growing Indo-Pacific region.

Defence and security are part of the Australia-Singapore relationship and of our Comprehensive Strategic Partnership.

The region is not only growing economically, it is also modernising in a military sense.

Asia’s defence spending is already larger than Europe’s and is continuing to grow.

This military modernisation, naturally enough, makes for a more complex strategic environment.

The Australian Government has recognised this, and we recognise that to thrive in a more complex strategic environment, we will need a more potent, agile and adaptable future fighting force.

So over the next decade, we are investing 200 billion dollars in strengthening Australia’s defence capabilities.

We won’t be doing this alone. The 2016 Defence White Paper recognised the importance of working with other countries.

The Australia-Singapore relationship is a vital part of defence engagement.

Singapore is Australia’s most advanced defence partner in South East Asia.

Along with New Zealand, Malaysia and the United Kingdom, Singapore and Australia are members of the Five Power Defence Arrangements.

The framework complements the other security frameworks in our region, and Australia values Singapore’s continued support.

The upcoming 50th anniversary of the Five Power Defence Arrangements will provide a useful opportunity for Australia and Singapore to consider future directions for this important regional security framework.

A key element of the Comprehensive Strategic Partnership is the Australia–Singapore Military Training Initiative in which Singapore’s Armed Forces will be provided with greater access to enhanced training areas in Central and North Queensland.

This will deliver greater training opportunities for both Australian and Singaporean troops, support new capabilities and platforms and improve the current capability of our soldiers to respond to shared national security challenges and contingencies.

With an investment of over two billion dollars, the initiative will see the existing Singapore presence increase from 6,000 to 14,000 troops per year on new and improved training areas.

The benefits of the Australia–Singapore Military Training Initiative are wide-reaching, and not limited to enhanced Defence cooperation.

Our two Governments are committed to helping local businesses harness opportunities from it.

There will be many opportunities for industry in construction, logistics support, and sustainment –even tourism – with construction set to commence on expanded training areas from 2019.

I have been excited to hear feedback from businesses and local industry representatives following the trade delegation that visited Singapore in August 2017, which included a lunch hosted by the Australian Chamber of Commerce.

Businesses in Australia are continuing to engage with the connections they made in Singapore and explore potential opportunities and partnerships.

It plays an important part in developing the Australia-Singapore relationship, but it is not the only training initiative being undertaken.

For over 24 years, the Republic of Singapore Air Force has been conducting training at Royal Australian Air Force Base Pearce in Western Australia, through its Flying Training Institute.

The Institute provides pilot and flying instructor training, and is a valuable part of the Republic of Singapore Airforce pilot training continuum.

Recently my colleague, the Minister for Defence, Senator the Honourable Marise Payne, signed the Pearce Treaty with Singapore to provide Singapore with continued access to Royal Australian Air Force Base Pearce to enable training.

The Treaty is expected to be ratified early this year.

Australian industry makes a valuable contribution to the success of this program.

Hawker Pacific is an Australian company that provides maintenance support for Australian PC-21 training aircraft and, since 2008, to Republic of Singapore Air Force training aircraft based at Royal Australian Air Force Base Pearce.

Innovation and research and development are essential if Australia is to maintain our capability edge.  Singapore faces a similar challenge.

Engagement between Australia and Singapore in this area goes back to 2005, and in 2015 we signed an expanded Memorandum of Understanding.

Last week, Australia and Singapore met at the Australia-Singapore Science and Technology Forum to explore mutual interests in a number of high-end Defence capabilities.

The Forum was a resounding success.

New collaborations may include unmanned vehicles, advanced materials and aircraft structures.

As I noted before, the 2016 Defence White Paper outlined the complex and challenging strategic environment that Australia faces.

To ensure the Australian Defence Force can succeed in this environment, we are undertaking the largest peacetime renewal of Australia’s Defence capability since the Second World War.

It will equip Australia to contribute further to regional security, support partners including Singapore and protect our national interests.

This is a game-changer for Australia’s defence industry – no less than a transformation of our strategic industrial base.

Thus the Turnbull Government is planning for a Defence future in a way no other government has done before.

We are putting in place policies, funding and initiatives to ensure we can grow, compete internationally and our Defence industry can enjoy long-term, sustainable success.

The Defence White Paper highlighted that if Australia was to successfully implement our Defence strategy we would need highly capable and versatile naval and maritime forces.

In 2017, we released the Naval Shipbuilding Plan, containing our commitment to a continuous shipbuilding program and to the Australian naval shipbuilding industry to deliver it.

We are very serious about building a sovereign Australian shipbuilding and sustainment industry.

As I mentioned earlier, we are building 12 Future Submarines to replace our Collins Class fleet, and they will be built in Australia by Australians, in Adelaide by France’s Naval Group. The first will enter service in the 2030s.

We will also build nine frigates and 12 offshore patrol vessels, and are currently building 21 Pacific patrol vessels for our near neighbours. Fifty‑four new ships in all.

This will all happen between now and the middle of the century.

The Turnbull Government has ended the era wherein the shipbuilding industry was plagued by boom and bust cycles.

It’s a sorry fact that the previous government did not commission a single ship over six long years, and the industry paid for it dearly.

You cannot sustain a highly productive shipbuilding industry beset by peaks and troughs in demand.

Industry needs clarity and certainty if they are to make the investments required to grow their workforce and capabilities. I know you know this.

So do workers. They want long-term job certainty if they are to enter the Defence industry, upskill and provide the expertise we must have.

The Turnbull Government’s Naval Shipbuilding Plan brings together what is required to deliver continuous naval shipbuilding in Australia and that means thousands of jobs.

Our 12 Offshore Patrol Vessels will be designed and built under prime contractor Lürssen of Germany, utilising ASC in Adelaide for the construction of the first two vessels.

The project will then transfer to the Henderson Maritime Precinct in Western Australia, where Lürssen will take full advantage of the capabilities of the Precinct by using the skills of the Austal and Civmec, subject to commercial negotiations, to build a further 10 vessels.

Our Offshore Patrol Vessels will be delivered by Australian workers, in Australian shipyards and with Australian resources, including Australian steel.

The project has a major focus on building an enduring Australian industry capability.

We are resetting the relationship between Defence and industry to encourage investment and create a true partnership.

We have a clear long-term pipeline of opportunities supported by the Government.

We have set up new 640 million dollar Defence Innovation Hub to mature and further develop new technologies, taking them into the engineering and development stages of the innovation process.

I have announced our investment priorities for the Hub to give industry certainty about our defence objectives, allowing them to plan and invest.

We have added 730 million dollars over the coming decade for science and research to support future-looking, game-changing technologies.

I’m pleased to say Australian industry is responding in kind. Last year saw a range of companies, including BAE Systems, Boeing, Leidos, Lockheed Martin, Northrop Grumman, SAAB and Thales make their own investments in innovation and their Australian workforce.

This is a huge vote of confidence in Australian defence industry, and a demonstration of how the Turnbull government’s policy agenda is providing the opportunities and certainty to invest, grow and succeed.

In 2017, the Turnbull Government strengthened the Australian Industry Capability Program to more clearly address how tenderers will maximise Australian industry involvement across the project.

It outlined how we will build enduring industrial capability, transfer technology and promote export opportunities for Australian businesses for all major capital equipment projects of 20 million dollars and above.

We are providing great opportunities for investment in Australia’s Defence industry.  Indeed, the strong interest from across the globe in Australia’s major acquisition projects is a demonstration of just how big these opportunities for investment and growth are.

Unlike many other countries, Australia has no offset policy.  Instead, we utilise our Australian Industry Capability Program to ensure opportunities flow to Australian businesses and empower them to invest and grow.

Australia’s Defence industry is already enjoying success overseas, including here in Singapore.

Prism Defence is an Australian company that provides a range of services in areas such as engineering advice and ship aircraft interface testing.  Their customers include the navies of Australia, New Zealand, Denmark and Sweden.

Prism has formed a relationship with ST Marine, based here in Singapore, to support their design of Landing Helicopter Docks for potential export.

While this opportunity is in its early days, this story highlights the fantastic opportunities for Australian companies to grow their business and export internationally.  It also shows yet again the complementary nature of the Australia-Singapore relationship, and the benefits that we enjoy from cooperation.

While businesses will need to take their own actions to invest and pursue export opportunities, the Turnbull Government is very active in the defence export space.

I will soon release the Defence Export Strategy, which will provide a comprehensive approach to supporting our Defence industry to enjoy greater success overseas.

We are investing in innovation, increasing the support available to industry and keeping our investment program on track.

We want clarity for both industry and the Australian community to enable investment in defence industry.

In the first half of 2018, the Government will release a suite of policies that will put in place further mechanisms to support industry and help us shape and guide our Defence industry.

This will include the first ever Defence Industrial Capability Plan, including our sovereign industrial capabilities, a Defence industry skilling and STEM Strategy, and a Defence Industry Participation Policy.

Australia and Singapore sit together in a rapidly-changing region. 

There are brilliant opportunities ahead, and also some significant challenges.

The deep Australia-Singapore partnership will sustain us in this.

The upgrade of the Singapore-Australia Free Trade Agreement and the Australian-Singapore Training Initiative give us new opportunities to collaborate and succeed.

Through such initiatives, we go forward with confidence and security, together.

Thank you.

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