(‘ FMAF’), designed to harness emerging opportunities in the transition to a lowemissions future and strengthen Australia’ s position in an evolving global landscape. 5
The FMAF aims to anchor this new era of advanced and sustainable manufacturing in regional Australia, directing investment toward industries and innovations that can drive economic diversification, create quality jobs and ensure regions are central to the nation’ s clean energy and industrial future. By backing key enabling technologies and building domestic supply chain resilience, the FMAF provides the strategic, long-term support needed to unlock regional potential. It will help transform regional communities from their carbon-intensive heritages into hubs of low-emission, high-tech manufacturing and future-focused industrial activity.
Regions that have long depended on carbonintensive sectors, such as coal mining, steel production and heavy industry, face unique economic and social challenges.
These include potential job losses, underutilised infrastructure, declining population and a lack of investment confidence. However, these same regions often have undeveloped or defunct assets that can be harnessed to support a manufacturing-led renewal. These assets include existing technical and industrial workforce skills, proximity to natural resources and built infrastructure such as rail, ports and industrial zones.
Advanced manufacturing offers a tailored response to these needs. 6 It enables regional economies to build on their heritage of making and engineering, while transitioning toward cleaner, smarter production. It also offers the promise of high-quality employment in areas where job creation is urgent and economically critical. Regions with strong vocational training systems, access to renewable energy( or the ability to build) or connections to research institutions are particularly well-positioned. However, success depends on intentional planning, targeted support, and a shared commitment to long-term transition.
As the global shift towards decarbonisation accelerates, regional communities face the challenge of transitioning from traditional, carbonintensive industries to a diversified, sustainable economy.
Lithgow, located in Central West NSW, has a rich industrial heritage marked by coal mining and power generation and is a perfect example of how manufacturing can be leveraged to aid an economic transition. Recognising this, the community, supported by local, state and federal governments, has embarked on a strategic transformation to position itself as a leader in advanced manufacturing. Central to Lithgow ' s transformation is the Lithgow Emerging Economy Plan(‘ LEEP’), a collaborative initiative involving Lithgow City Council, the NSW Government and various stakeholders. LEEP outlines a roadmap to diversify the local economy, focusing on sectors such as renewable energy generation and storage, circular economy processes and, importantly, advanced manufacturing. It doesn’ t just identify new sectors to grow; it also outlines mechanisms to attract investment, upskill the local workforce and modernise infrastructure. Manufacturing, particularly in its modern, clean and tech-driven form, is a key pillar of the plan. Lithgow ' s industrial legacy, including its skilled workforce, existing infrastructure and access to transport corridors, provides an ideal platform for this shift.
Building on the strategic vision outlined in the LEEP, the redevelopment of the former Wallerawang Power Station by the Australian-owned company, Greenspot, represents a cornerstone project in Lithgow’ s transition from a coal-reliant economy to a centre of sustainable industry and advanced manufacturing. The 620-hectare site is being transformed into a multi-use precinct that integrates former coal-related infrastructure, industrial innovation and long-term job creation. Greenspot’ s vision includes establishing an industrial ecosystem that would enable the advanced manufacturing industry as a strategic and long-term driver of regional transformation.
By leveraging Lithgow’ s infrastructure and workforce, Greenspot exemplifies growing private sector interest in regional precincts aligned with national policy. As a catalyst for economic diversification, the Greenspot redevelopment illustrates how legacy industrial sites can be reimagined to drive innovation and investment, particularly for advanced manufacturing.
Transforming a regional economy through manufacturing requires diligent, intentional methods.
Lithgow ' s proactive approach to economic diversification, underpinned by strategic planning, infrastructure development, industry engagement and educational initiatives, serves as a model for regional economic transformation. However, replicating this across other regional economies also requires a coordinated mix of investment, skills, infrastructure, governance and policy. Below are four core enablers of successful manufacturingdriven regional transformation proposed by this paper:
1. INVESTMENT ATTRACTION Attracting capital is foundational to transitioning a regional economy from reliance on legacy industries toward a future shaped by clean, smart and sustainable manufacturing. To compete globally for investment in advanced manufacturing, regional areas must cultivate a compelling proposition that combines infrastructure, skills and policy alignment. Tailored incentives are critical to driving investment into manufacturing in transitioning economies, including tax concessions, payroll tax relief, streamlined development approvals and grants targeting innovation, low-emission technologies or circular economy models.
ECONOMIC DEVELOPMENT JOURNAL VOL 18 NO 2 2025 13