CANBERRA: A couple of years ago the Export Council of Australia began to look at what other countries were doing to promote trade off the back of the financial crisis of 2007/2008. Countries such as the United Kingdom, United States, New Zealand, Germany and France were all prioritising and investing in strategic trade development activity.
At the same time, we were seeing Australia, a country of great wealth facing challenging decisions over how best to allocate resources with declining terms of trade, a slowdown in foreign direct investment, a sluggish global economy, and fiscal constraints.
Trade is an important pillar of the Australian economy, and while only a small number of large companies are responsible for the majority of the volume of trade in goods, small exporters and their export success are of increasing importance to Australia’s future economic growth prospects.
The Australian economy performed well both during and after the financial crisis but GDP growth is yet to return to pre-GFC levels, the economy will need productivity improvements to maintain current levels of per capita growth.
Increasing Australia’s level of trade will ultimately play an important role in improving productivity and fostering sustainable economic growth.
In Australia, there are approximately 45,000 exporters that exported $318.5 billion worth of goods and services in 2013. However, just 1% of exporters account for over 90 per cent of all goods exported from Australia – which is much more concentrated than the international average, where the top one per cent of exporters account for just 53 per cent of goods exports.
Given the recent signing of free trade agreements, now is the time to focus on how we can support the capacity and capability of Australian companies to take advantage of the market opportunities created by the North Asian FTAs.
A fantastic platform to begin this debate is the Advancing Trade Development report, a study that the ECA began a few years ago into the international trade promotion efforts of 10 important exporting nations.
A broad range of countries were selected based on their export prowess, the strong trade promotion services they offer their local businesses and lessons they may have for trade promotion organisations in Australia and around the world.
Ultimately, we need to create a platform in Australia to discuss the opportunities that investment in trade promotion can offer to medium sized companies across a wider group of sectors.
In doing so, Australia will not only be creating the opportunities that support future economic growth, but will expanding Australia’s business connections in the region.
It is imperative that we continue to advocate for greater investment in trade promotion, as well as for targeted action in trade-enabling sectors.
