Australia to offer manufacturing sector $925 million in grants, PM to say

SYDNEY (Reuters) - Australia will offer manufacturers up to A$1.3 billion ($924.8 million) in grants to expand, Prime Minister Scott Morrison will say on Thursday, as Canberra outlines its plan to revive an economy ravaged by COVID-19.

FILE PHOTO: Australian Prime Minister Scott Morrison speaks during a joint press conference held with New Zealand Prime Minister Jacinda Ardern at Admiralty House in Sydney, Australia, February 28, 2020. REUTERS

Australia is in the midst of its first recession in three decades after shutting large swathes of its economy to slow the spread of COVID-19.

While the measures have seen Australia emerge as one of the world’s most successful in combating COVID-19, Canberra has been forced into a series of stimulus packages.

In the latest round, Morrison will say Canberra will co-invest in projects in six industries such as space, defence, and resources.

“We make things in Australia. We do it well. We need to keep making things in Australia. And under our plan we will,” Morrison will say in a speech in Canberra, extracts of which were given to the media.

Morrison will say businesses will be eligible for grants of between A$100,000 and A$1 million. Businesses will be required to match the government funds by a ratio of three to one.

The funding will be allocated over the next four years, details of the plan seen by Reuters show.

Morrison will say that the six industries that also include food; medical products; recycling and clean energy have been identified using a range of evidence that draws on data from the World Bank and OECD.

The funding package is expected to be a key pillar of Australia’s budget to be delivered next week, which Morrison has described as the most important since World War II.

Manufacturing has already been identified as a central pillar of Morrison’s plan, and earlier this month Canberra unveiled a plan to boost gas supplies and drive down energy prices to fuel production.

($1 = 1.4057 Australian dollars)

Reporting by Colin Packham; Editing by Chizu Nomiyama