The AUKUS partner nations announced that they have lifted more defence trade barriers in an effort to form closer defence ties at a time of increased tensions on the world stage.
These long-standing export controls have come under enduring scrutiny for undermining the smooth exchange of critical systems and technologies among Australia, the US and UK.
Particularly, the US’ International Traffic in Arms Regulations (ITAR), introduced in 1976 during a period of military secrecy amid the Cold War, have been perceived as counter-productive in pursuing the AUKUS mission.
Though, the UK’s AUKUS Nations Open General Licence and Australia’s own export control network have also lifted similar licence requirements imposed from their side.
Styled as an “historic breakthrough” in a UK Ministry of Defence statement on 15 August 2024, the changes will cover up to £500m ($644.4m) of British defence exports each year. Though, collectively, the changes will free up billions of dollars in licence-free trade among the three partners over the longer-term.
The Pillar II segment of AUKUS will benefit the most as an initiative that encompasses the joint development of a wide range of emerging technologies, from deep space to quantum.
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Room for more exemptions
Although, it is not the first time that the three countries have loosened their grip on their export controls since the AUKUS alliance came into existence back in 2021. Less than four months ago, the US axed certain licencing requirements it had imposed on Australia and the UK for most military and technology items.
While the latest exemptions go further in eliminating export hindrances, it appears that some restrictions remain in place for the time being. According to the Australian government, more than 70% of defence exports under ITAR bound for Australia are now licence-free. The exemptions are not total.
Nonethless, Australia’s Deputy Prime Minister Richard Marles underscored the importance of the changes, commenting: “These critical reforms will revolutionise defence trade, innovation and cooperation, enabling collaboration at the speed and scale required to meet our challenging strategic circumstances.”
Export controls, especially ITAR, have been a hot topic when it comes to discourse around AUKUS. The size of the US defence industrial base is obviously much larger than its allies, and combined with policies such as ITAR the US defence market is more difficult to tap into for allies.
However, this is a narrative that Kylie Wright, the assistant secretary defence industry at the Australian Department of Defence, argued where a cultural change is needed in viewing the US as a dominant partner: “they’re not going to gobble up our tech,” she said on a panel at Farnborough Air Show in July 2024.
