Accelerated US-Australia trade in Emerging Tech worth billions to Australia

Australia could gain 80,000 highly skilled jobs and secure AUD $24billion in incremental capital investment by the end of the decade if the nation accelerates Emerging Tech exports to the United States, a new report by KPMG Australia and the American Chamber of Commerce in Australia, finds.

A Prosperous Future: Emerging Tech shows substantial untapped trade potential between the two countries. It highlights Australia's world-leading research in Artificial Intelligence (AI), the Digital Economy and Quantum Science, three sectors poised to benefit from the landmark AUKUS security pact. The report notes that Australia ranks among the top ten nations globally for Quantum Computing research and venture capital investment and 11^th in QC patents. But the report contends Australia must improve efforts to transform innovation into commercialisation to capitalise on the unprecedented economic opportunities in Emerging Tech.

US Ambassador to Australia, Caroline Kennedy, commented: "This report shows that by building on decades of close economic partnership and shared values, the U.S. and Australia are together poised to create tens of thousands of new jobs in the industries of the future. Our commitment to innovation, and to integrating our economies even more closely will help ensure a stable and prosperous Indo-Pacific that benefits the people in both our countries."

Report co-author, Dr Brendan Rynne, KPMG Australia Chief Economist, said: "Emerging technology holds significant economic potential for both countries. Our modelling shows that Australian companies could realise billions of dollars through increased exports to the US and far greater participation in the value chain if their efforts are focused on enhancing products and services in key US Deep Tech sectors".

The report analyses Australia's strengths in each industry against the level of openness in the United States to identify opportunities for Australia to participate in the US supply chain, such as Australia's trailblazing AI capabilities in mining and defence. It notes that niche AI products and services that complement US capabilities are more likely to find a path to market, and identifies the Financial Services Industry, which purchases US $2 billion of AI goods and services annually, as the sector where Australian firms are most likely to be successful. The report suggests Australian companies at the vanguard in QC and the Digital Economy could also experience dramatic growth.

"As this report demonstrates, it's vital for Australia and the United States to collaborate in AI, Quantum Computing and the Digital Economy to secure the full economic and strategic potential of these powerful new technologies," says AmCham Board Chair Dr Brendan Nelson AO, President of Boeing Australia, New Zealand, and South Pacific.

"The stakes are huge," agrees co-author Doug Ferguson, KPMG Head of Asia & International Markets and NSW Chairman. "Australian companies must move beyond our proven research strengths and engage and compete in both Australian and US customer markets and in partnership with US firms. This will require a disproportionate joint effort by Australian corporate, federal government and tertiary education sectors."

This report follows an initial paper by KPMG and AmCham in December 2021 which outlined key industries for US/Australia collaboration. There will be a further report in the A Prosperous Future series, which is supported by the US Embassy in Canberra, next year.

"These findings underscore the tremendous potential uplift in the already sizeable US-Australia economic relationship," says AmCham CEO April Palmerlee. "This report highlights several areas that can take Australia to the next level: more jobs, more revenue, and more innovation. Collaboration in emerging technologies benefits both countries."

Explanation of analysis

Key findings