Strengthening New Zealand’s Defence Industrial Base: A Strategic Overview
Introduction
The New Zealand Ministry of Defence (MoD) has unveiled a comprehensive strategy aimed at enhancing its domestic defence industrial base while bolstering the capabilities of the New Zealand Defence Force (NZDF). This strategy, a detailed 44-page document published in early October 2025, delineates targeted objectives and actionable initiatives for the forthcoming four years.
Strategic Objectives
The Defence Industry Strategy focuses on three primary goals:
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Clarification of Defence Needs: Establishing a clearer understanding of defence requirements to guide local industry development.
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Local Industry Engagement: Actively leveraging domestic industries and fostering their growth to increase self-sufficiency in defence capabilities.
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Integration with Australia: Strengthening ties and cooperative defence arrangements with Australian counterparts to bolster regional security.
Defence Minister Judith Collins underscores the importance of agility and innovation, stating, “While we may not be the largest provider, our approach can be the most astute.”
Fostering Local Capability
With approximately 800 companies in the local defence sector, the government emphasizes creating opportunities for partnerships with the NZDF. Initiatives include:
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Partnerships with the NZDF: Encouraging local entities to collaborate closely with the NZDF, enabling them to serve as principal contractors or subcontractors to larger international firms.
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Revised Procurement Regulations: New guidelines stipulate that major contractors must develop industry capability plans, ensuring that local businesses have significant participation in procurement and sustaining operations.
These efforts align with the implementation of the Defence Capability Plan (DCP), which outlines a commitment to invest NZD12 billion (approximately USD7 billion) over the next four years to enhance NZDF capabilities.
Exploring the ‘Thin Prime’ Model
To further stimulate the domestic defence sector, the MoD is investigating the ‘thin prime’ strategy. This model allows local enterprises to take on comprehensive contract responsibilities while subcontracting tasks to larger original equipment manufacturers. This approach is anticipated to:
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Promote Competition: By allowing local companies to assume a central role, the strategy is expected to foster a competitive environment.
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Facilitate Growth: Local businesses can progress along the value chain, enhancing their capabilities and market position.
Conclusion
New Zealand’s Defence Industry Strategy represents a proactive approach to cultivating a robust and resilient defence industrial base. By clarifying defence requirements, fostering local capabilities, and leveraging international partnerships, the MoD aims to ensure that the NZDF remains responsive to future challenges. The strategy, both ambitious and pragmatic, positions New Zealand as an increasingly savvy player in the global defence arena.
