New Zealand's Defence Minister Judith Collins speaks at the Five Power Defence Arrangements (FPDA) Defence Ministers’ Joint Press Conference Meeting (FDMM) on the sidelines of the Shangri-La Dialogue in Singapore May 31, 2024. REUTERS/Caroline Chia
WELLINGTON (Reuters) -The New Zealand government said on Friday it was changing defence procurement rules and introducing a new military technology fund in an effort to boost the local defence sector as government spending is set to increase.
The New Zealand government said earlier this year it would boost defence spending by NZ$9 billion ($5 billion) over the next four years, and aim to nearly double spending to 2% as a share of gross domestic product in the next eight years due to growing concerns about strategic competition.
“When the world around us is changing at such a pace, we need to change our approach to how we equip our Defence Force, and we need to work in partnership with industry to be better together,” Defence Minister Judith Collins said in a statement about the release of the Defence Industry Strategy. “Not to do so would be irresponsible.”
The strategy laid out new government procurement rules that require multinational defence suppliers to develop and submit plans to ensure the use of local industry in delivering and sustaining defence capability.
It also said the defence force will explore opportunities to use small and local businesses to deliver equipment and systems, while subcontracting the original equipment manufacturer.
The government will introduce a new NZ$100 million to NZ$300 million ($58.15 million-$174.45 million) fund to develop advanced technologies for military use by the defence force.
Although New Zealand's defence industrial base includes at least 800 suppliers, most of its significant purchases are sourced from multinational suppliers.
“We have the talent and the will. We now need to build the supports and clear the way for innovation,” Collins said.
The strategy also includes plans to present a new Defence Capability Plan every two years, with the next plan due in 2027.
($1 = 1.7197 New Zealand dollars)
(Reporting by Lucy Craymer; Editing by Chris Reese)
