CreditorWatch’s latest industry whitepaper – ‘How the manufacturing industry can strengthen the Australian economy’, presents a comprehensive overview of the current state-of-play and outlook for Australia’s manufacturing industry.

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Amid ongoing economic turmoil, CreditorWatch has found one of Australia’s most promising opportunities is to develop the capacity to manufacture products locally. The whitepaper calls out how demand for local products is set to rise considerably in the foreseeable future and with the Australian Government recently announcing its Modern Manufacturing Strategy, this provides a strong baseline to make this a reality.

While there are plenty of products where the cost-benefit calculation means offshore manufacturing makes sense, there are other products, particularly in emerging spaces like clean energy and food sustainability, where it makes sense to build local capacity.

CreditorWatch CEO, Patrick Coghlan, says: “The Australian economy, like most economies around the world, has undergone upheaval during each stage of the COVID-19 pandemic. The war in Ukraine and local floods have only exacerbated this upheaval. The result of all these events has been extremely disruptive to the economy, with lockdowns, breakages in supply chains, a lack of labour, dramatic shifts in consumer demand, rising energy costs and rising inflation all making conditions very complicated for businesses to operate in.

“However, with disruption comes opportunity and one of the clear opportunities this presents is for Australia to manufacture products locally.”

Our Business Risk Index data points to the manufacturing industry as one of the sectors with a consistently low probability of default. Given that our July data reveals external administrations and court actions are up 46 per cent and 54 per cent year-on-year respectively and insolvencies are forecast to rise across all industries, the security of the manufacturing industry makes it the ideal sector to invest in right now.

Three clear emerging areas where this opportunity presents itself:

• Clean energy
• Food manufacturing
• Pharmaceutical & medical manufacturing

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