The Australian government is celebrating after it’s National Reconstruction Fund Bill passed through the senate.
The Bill, which is aimed at increasing Australia’s manufacturing base and dependence on imports, received support from the crossbench and will invest $15-billion dollars into the Australian manufacturing industry.
So, what will the fund achieve?
According to ABC News, the fund will invest in renewable and low-emission technologies; medical research; transportation; value-added agriculture, forestry, and fisheries; value-added resources; defence capabilities; and supporting technologies.
Up to $500m is available for ‘value adding’ in forestry and fibre, along with agriculture, fisheries and food.
Funding will be provided through loans, equity, and guarantees.
From the fund’s launch, an initial $5 billion is available, with the remaining $10 billion to be distributed in instalments by July 2, 2029.
Inspired by the Clean Energy Finance Corporation, the fund involves the government partnering with private investors to support domestic manufacturing projects.
So, who will this benefit?
According to ABC News, the government is using the bill to shore up supply chains and reduce exposure to global pressures.
According to the Bill’s Explanatory Memorandum, the goal of the fund is to “invest to support, diversify and transform Australia’s industry and economy to secure future prosperity and drive sustainable growth”.
In essence, it should benefit all Australian businesses connected to the forest and fibre-based industries.
Joel Fitzgibbon, CEO of the AFPA, stressed that the new fund will support businesses native and plantation timber and fibre industries.
“They employ many thousands of people, especially in rural and regional Australia and allow Australians to access essential native timber and fibre products that would otherwise come from less environmentally reputable supply chains internationally.”
Industry Minister Ed Husic said new and emerging firms would be prioritised for funding.
“We want new and emerging firms that sometimes find it hard to get that investment support,” Mr Husic said.
“The reconstruction firm is there to de-risk for other investors.
“We’ve seen so many great ideas that have left our shores only for us to import them back as product that somebody else has manufactured.”
Wood Central hopes that the Fund will provide investors with confidence to reinvest into the forest and fibre products industries and more importantly plant more trees!