War support could win US contracts
October 11, 2005
AUSTRALIA’S support of the US in Iraq could help local companies crack the huge US government contract market, a visiting American consultant says.
Robert Van Gorder, vice-president (consulting) of the Washington Management Group, is in Australia talking to local businesses about the opportunities available under the Australia-US free-trade agreement (FTA).
Under the FTA, Australian firms can for the first time directly tender for US government contracts. Last year those contracts were worth $US314 billion ($413 billion).
Mr Van Gorder said the market was highly competitive but Australia’s support for the US in the war in Iraq would help firms.
"It is very helpful, especially under this administration," he said. "Companies from France (which opposed the Iraq war) are still having trouble.
"So in this case, if you’re supportive they will support you, they will make sure they help you along."
Before the introduction of the FTA, which came into operation this year, just 32 Australian firms had US government contracts worth a combined $US14 million ($18 million).
But Mr Van Gorder said interest would grow now that the FTA was in place, and Australian firms started to get an idea of the opportunities in the US.
Already, one Australian firm was supplying meals to US marines.
Mr Van Gorder said that with competition fierce in the US contract sector, Australian firms would initially have to take small steps.
"You have to be committed, and you have to keep working to build yourself," he said.
"It’s like any new market and that means getting yourself known, and once that happens, then the new contracts can flow."
Some of the key contract areas include the services sector, IT, research and development and management support. Other areas where major contracts are available include military components.
Andrew Hudson, a partner in Australian trading firm Hunt and Hunt, said that in the first months of the FTA’s implementation, most companies had focused on cuts in tariffs.
But in recent months there had been a marked increase in interest in areas such as government procurement as Australian businesses realised the opportunities in the US.
"There’s been a real awakening of the opportunities, and what we’re trying to do here is give firms some help in understanding how to work their way through it," he said.
Mr Van Gorder said Australian firms should consider tendering for contracts that may not grab the direct attention of competitors, such as military base maintenance and service provision in South-East Asia.