Sunday, 12 October 2014

3D Printing In Australia

It seems every day I look in the news and see bleak outlooks on the Australian market. Coal is down, Iron is down, the financial sector is down and even the IMF (International Monetary Fund for those of you who don't follow economics) has announced some rather dire warnings about the future of the Australian economy.

I've read many comments by journalists and the general public about how the Australian manufacturing industry has been left to wither and die due to a lack of support in the wake of the brilliant mining boom that has pushed our economy to dizzying heights. There is some hope though as it seems apparent our reliance on two of our major exports, iron and coal, will be unable to sustain our newly heightened wealth means we must start looking at other ways of paying our bills and keeping our swimming pools filled with gold-plated water. Manufacturing, the transformation of commodities into simple transformed manufactures or (dare Australia dream) of extreme transformed manufactures. Value adding to the things we already have in abundance before we sell them off.

Perhaps fortunately at this time there is a budding interest in a somewhat unknown process called 3D printing. It's advocates (me included) consider it a potential golden age for manufacturing, allowing construction of any object you might want from a plastic fork to a new house. This marvel of engineering and technology has the potential to do for manufacturing today what the moving assembly line did for it in the early 1900s. In fact given that 3D printers remove the labor component of manufacturing almost entirely (aside from a few technicians required to maintain the machines) it may be something Australia wants to consider more closely.

Manufacturing has very noticeably shifted from Australia and other western nations to places like China and India. This isn't because Australian's have anything against manufacturing but because employing a few thousand people to assemble sneakers is a whole lot cheaper in India than it is in Australia because labor is so much cheaper. Many businesses who have attempted to keep their workforces in Australia or the USA have found themselves uncompetitive and have been forced to outsource or fall behind and die.

So for lower populations like Australia what does 3D printing mean for us? It's an opportunity to take advantage of our advanced infrastructure and resources without being hampered by our extremely low population. In most other industries our low population and very high wage costs are a huge challenge for would-be businesses to overcome before they can start seeing black at the end of the day. 3D printing is a convenient and seemingly perfect solution for Australia.

But how can we take advantage of this? The same way any country does when they want to encourage an industry; tax relief to assist new companies with starting up and strengthening so that when it is time for them to give back they are in a position to do so in a meaningful way. It would not cost anyone anything to allow them a few years grace (personally I'd like to see a 5 year tax exemption then a gradual increase in the tax they pay over the following 5 years until they pay full taxes only after the 10th year) to really start a strong 3D printing industry in Australia. The chances of this however are so slim that I don't really believe anything like this will happen. Perhaps someday we will be more open to long term industry planning like this.

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