Mongolia: Opportunities for Australian exporters

According to the World Bank data, the economy of Mongolia grew by 17.3% in 2011 compared to 6.4% in the previous year. As of the first quarter of 2012, the growth rate was 16.7% and estimated to reach 20% by year end (Eurasia Capital, 2012). Traditionally the country is mainly dependent on livestock herding and agriculture, but in the recent years, due to exploration of large mineral deposits, mining has come to contribute to nearly 20% of the total GDP. Two of the major mining projects, namely Oyu Tolgoi and Tavan Tolgoi, are considered to be part of the five largest copper and gold mines in the world and considered to supply high quality coking coal for over a century (World Bank, 2012).

In terms of foreign investments nearly 70% of the total FDI is invested into the mining sector and about 20% into trade and catering services. In relation to the mining boom and the development in this sector, in the last 3 years the number of service imports in the form of financial and legal services, business consulting firms and human resource recruitment agencies has also increased exponentially. Australian mining and construction companies such as BHP Billiton, Leighton and Rio Tinto have been in Mongolia for many years and hold significant leases to the mineral deposits (FIFTA, 2012).

Diplomatic relations between Mongolia and Australia began in 1972; however it was not until 1990 when Mongolia transitioned to a free market economy that the bilateral engagement was enhanced. According to the customs official statistics report for 2011, the total export trade from Australia to Mongolia was 44 million AUD and the import from Mongolia to Australia totaled 0.5 million AUD. While the trade total is a modest sum compared to Australian trade with other countries, Australian exports to Mongolia have doubled every year since 2009 and has further growth potential (Australian Government, 2012).

A significant portion of the Australian export to Mongolia include heavy machinery, specialized equipment, measuring and analysis apparatus and technologies mainly used in the mining sector. The main exports from Mongolia are cashmere, coal and fluorspar. China is both the principal importer and exporter from Mongolia at 80% of the total export and 40% of the total import (Austrade, 2012).

Austrade has recently opened a permanent office in the capital city Ulaanbaatar with an aim to enhance the commercial ties between Australia and Mongolia and it serves as the gateway for Australian businesses and individuals hoping to expand into the Mongolian market.

With nearly half the small population of less than 3 million living in the capital city, and with a few large companies dominating the majority of the trade, it is easy to find distribution channels and buyers in Mongolia. Growing number of young people are educated abroad exposed to the western way of doing business and thus language barriers and cultural misunderstandings will not be an obstacle.

The Mongolian government policy to promote international trade has created a favorable environment for the traders and the country continues to facilitate trade. In order to overcome the over dependence on imported products and to enhance export, the export duty has been set to 0% and the import duty is one of the lowest at 5% for all commodities with the exception of a seasonal duty increase on vegetables between July and April at 15%. Throughout the country there are a number of free trade zones, free economic zones and bonded construction site and manufacturing areas (Mongolian Customs, 2011).

With an aim to support the small and medium enterprises, current import duty on equipment, machineries, mechanical appliances, reactors, boilers and the corresponding parts for SME purposes has been set to 0% until the 31st of December, 2012 (Mongolian Customs, 2011). Exporters in this sector must not lose the opportunity. Additionally, construction and services sectors and private consumptions are expected to grow for those in the business of exporting construction materials and food products.

Currently Australian export is less than 1% of the total import of Mongolia. With the increase in the average household income and people’s growing conscience toward quality health products, suppliers of food, beverage and snacks may be able to expand their market and increase Australian share in the market. Other main exports from Australia the Mongolians are accustomed to include Australian wine, machinery and mechanical appliances, prepared foodstuff, chemicals or products of the allied industries, and construction materials (Mongolian Customs, 2012).

- Contributing article prepared by Enkhtuul Enkhtuvshin, Export Council of Australia

References:

Austrade (2012), “Mongolia Profile: Current Business Situation”. Retrieved from: http://www.austrade.gov.au/Mongolia-profile/default.aspx [Accessed 10/07/2012].

Australian Government (2012), “Mongolia country brief”, Australian Government: Department of Foreign Affairs and Trade. Retrieved from: http://www.dfat.gov.au/geo/fs/mngl.pdf [Accessed 10/07/2012].

Asian Development Bank (2012), “Asian Development Outlook 2012: Confronting Rising Inequality in Asia”. Retrieved from: http://bcmongolia.org/images/Articles-Reports-Mongolia/ado2012.pdf  [Accessed 11/07/2012].

Eurasia Capital (2012), “Mongolia’s GDP accelerates 16.7% in 1Q2012”. Retrieved from:  http://www.eurasiac.com/mongolia-s-gdp-accelerates-167-1q2012 [Accessed 12/07/2012].

Foreign Investments and Foreign Trade Agency (2012), “Economic Outlook and Major Economic Sectors”. Retrieved from: http://www.investmongolia.com/fiftanew/contents.php?id=1&sId=2&lang=Eng[Accessed 11/07/2012].

Mongolian Customs (2012), “Customs official statistics report – 2011”. Retrieved from:  http://www.ecustoms.mn/index.php?lang=mn [Accessed 11/07/2012].

Mongolian Customs (2011), “Annual report – 2011”. Retrieved from:  http://www.ecustoms.mn/about.php?wmid=102&wmsid=104 [Accessed 11/07/2012].

Security tips for business travel in high risk areas

As the increase in the number of export opportunities for companies in developing markets grows, so to does the personal risk of doing business in these high risk areas overseas. Whether you are travelling individually, as a group or on a trade mission, there are certain markets in which you need to factor in your own personal safety and that of your colleagues.

As part of your market entry preparation, it is just as important to be aware of some of the personal risks of doing business in a particular market. We are not saying that you should avoid these markets, however with the support of Strategy Protect, a privately owned Security Consultation firm,  below are some very useful tips that you should include as part of any pre departure preparation.

SECURITY TIPS FOR BUSINESS TRAVEL IN HIGH RISK AREAS

1. Useful information for your travel

• It is important before you travel you look at the Australian Government website further for their travel recommendations and warnings.
• Mobile phone - Roaming activated and charged battery.  If you are travelling to remote areas, use a satellite phone.
• Ensure you are up-to-date with immunizations and have malaria tablets if required for that country.
• 24/7 Australian Consular Assistance for Foreign Travel is +61 2 6261 3305
• Knowledge about emergency numbers (Police and Ambulance Service)
• Find out the location of police station, service station, hospital and 24 hour Pharmacy closest to the hotel.
• Make sure your travel insurance covers you where you will be travelling and you can increase your cover to encompass potential threats.
• Establish a meeting point in case any member of the group is lost.
• If you rent a vehicle, it is preferable to rent a 4x4 with a GPS navigation system; if not, arrange the hotel taxi to collect you from the airport and ideally secure a hotel driver for the duration and take your own GPS.

2. Walking in the street

• Do not fall into a routine in your activities and movements and do not comment in public about your activities.
• Avoid walking during the night; you will be an easy potential target.
• Walk in groups and try not to go too far from the pack.
• Do not carry or wear valuables.
• Walk along the roadside opposite the direction of traffic, this measure helps to prevent being followed and "express kidnappings".
• Do not visit the main squares and government buildings during demonstrations. 
• Do not give money to beggars, adult or children. They are often associated with criminal organisations.

3. Driving

• Avoid driving at night and early morning.
• Check the vehicle before using it; wheels, fluid levels, lights, fuel and tools.
• Trips to remote areas:  Travel with at least two vehicles and provide your itinerary to your company or the embassy.
• If you have a breakdown on the road, you will be an easy potential target.  If it’s a flat tyre, consider continuing until the service station.
• Keep the fuel tank above half and pack water and food. Carry a first aid kit.
• With manual cars, if you have to stop the car, always set it in first-gear.
• Drive with the boot and doors locked and windows up to stop anyone attempting to enter the car when stopped at traffic lights or stuck in congestion. 
• In the city, when the light is red, try to keep your car in the middle lanes, thieves usually attack from the sidewalk.
• Watch for any vehicles that may follow, if monitored, do not change the way you are driving and try to get all the information possible (number of people, car and registration) and go straight the nearest police station.
• Do not stop to help someone on the road; criminals use women and children to ambush.

4. Parking

• Use parking lots with a security service.
• Do not leave bags or valuables in sight inside the car. 
• Never remain inside the parked car, if you do you become the perfect victim.
• Always park your car facing the exit as it is the fastest and safest way to leave.

5. At the ATM

• You should avoid using ATMs. Use only ATMs in supermarkets, shopping malls or other places where there are security personnel.
• When making payments with your credit card, only pay when your card is in front of you (ie the card machine) as your cards could be cloned or duplicated without your knowledge.

6. Documentation

• Bring a photocopy of your passport and another form of photo ID (both certified by a JP) for easy identification in case of a lost or stolen passport.
• Travel insurance documents.

7. Health service

• Ensure you have advised your Health Insurance Provider of your travel and extend the policy if necessary (compare this with the travel insurance).
• If you are receiving any ongoing treatment, bring enough medication for the trip in case you cannot find the same medicine in the country you are visiting.

Don’t react to physical attacks; the main objective is to survive the assault.

José M. Bravo
Managing Director
www.strategyprotect.com

   

Complete the DHL Export Barometer and enter the draw to win an Apple IPad2!

We would like to invite you to take part in the DHL Export Barometer. Complete the survey and we'll put you in the draw to WIN an Apple iPad 2*!

The DHL Barometer surveys exporters around Australia each year about their views on the exchange rate, share market, skill shortages and other important issues that impact on their global business prospects.

The DHL Export Barometer is used by the Reserve Bank of Australia, other economic policy institutions and reported widely throughout the Australian media.
Your views as a current exporter would be highly appreciated and will help DHL to provide a more accurate snapshot of the experience and views of Australian exporters in the current global economic environment.

To complete the survey and put yourself in the draw for an iPad 2*, please CLICK HERE
 
The online multiple-choice survey takes less than 10 minutes to complete and you will be responding directly to DHL.

Should you decide to participate, a copy of the DHL Export Barometer executive summary will be emailed to you in late July 2012, giving you a head start on identifying key international business trends and planning your export strategies for the coming year.

Indonesia: Opportunities for Australian exporters

In the last couple of years, Southeast Asia’s largest economy, Indonesia, has significantly lifted its global economic profile by increasing the annual growth (export.gov 2012).  A few months ago Bank Indonesia predicted a forecast of 6.4% GDP growth in the country by the end of 2012 (dfat.gov.au,  2012).

Not only did Indonesia manage to sidestep the world’s recent financial crisis, but it also outperformed many of its export-oriented peers in the region (Austrade, 2012). The Indonesian consumer market continues to rise, along with possibilities for international trade.  Indeed, today Indonesia can be considered as Australia’s most ambitious trade deal.  

On January 12 2012, the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA) entered into force for Indonesia (Austrade, 2012). This event was marked as particularly important for international exporters (including Australian) doing business in the country as it was promised to deliver a number of commercial benefits to their companies. The Australian exporters will be able to take advantage of the Australia-Indonesia   Development area (AIDA), the policy that has been designed to develop closer economic relations between Australia and the eastern provinces of Indonesia.

Throughout the last decade, the relationship between Australia and Indonesia has become considerably stronger (dfat.gov.au, 2012). The two neighbour countries have been able to sustain a healthy trade and economic relationship with two-way trade (both services and merchandise) which in 2011 was worth of $13.8 billion, and two-way investment which in 2010 was worth of approximately $5.7 billion. Indonesia is currently Australia’s 4^th largest trading partner in ASEAN and 12^thlargest partner overall (dfat.gov.au, 2012). There is big potential in promoting trade and investment links between the two parties, which are currently counted as the two largest in the region. At the moment, Indonesia is continuously encouraged by the Australian government to maintain liberalised trade and investment regimes. The government seeks reductions in tariffs to help Australian exporters open their businesses in Indonesia. Moreover, Australia and its neighbour country are working closely within the Cairns Group of Agricultural Fair Traders (the Cairns Group) with the aim to boost liberalisation in international trade in agricultural products during the current round of WTO negotiations (dfat.gov.au, 2012). Indeed, Indonesia is an important exporter of agricultural goods, and therefore plays a big part in the Cairns Group.

According to Austrade (dfat.gov.au, 2012), more than 400 Australian companies are currently operating in Indonesia. Some of the most successful businesses specialise in sectors of agribusiness, mining, resources, infrastructure, clean energy and environment, consumer goods and many more.

For years Indonesia has been well known for its spices and seafood exports (rsj-international.co.uk, 2010).  In addition, the country has been famous for its artisans who create unique artwork, making handicrafts another important sector for export purposes. Tourism also plays a crucial role in Indonesian economy, which causes a higher demand for improvement in the existing infrastructure for tourists. With the great popularity of tourism, there are opportunities to open up hotels, cafes and restaurants in the country. Similarly, Indonesia is in need of health care services, IT professionals, architects and engineers. The air craft market also favours overseas products (replacement parts and service). At the same time, the expansion of banking provides software and systems opportunities (export.gov, 2012). Training and education, renovation and construction of regional and municipal infrastructure and water systems, military upgrading,  safety and security systems, telecommunications technology and satellites -   all these areas create endless possibilities and are expected to deliver great benefits for Australian companies operating in Indonesia (rsj-international.co.uk, 2010).

However, despite all the above listed business opportunities, it is also important to bear in mind that there are potential problems that Australian export-oriented companies are likely to face when trading with Indonesia. One of these problems is caused by the the rule-of-law issues that still persist in the country. Foreign and local businesses continue to cite corruption, and due to courts being unable to deal with it, complications occur. Business disputes that can potentially be considered administrative in Australia, can count as criminal cases in Indonesia (export.gov, 2012).  Another problem represents the recent depreciation of Indonesian Rupiah (BBC, 2012), which in the nearest future is expected to make Australian exports relatively more expensive.  There is also a fear that the weak Indonesian currency can decrease the purchasing power of local consumers and therefore dent demand. Moreover, it may not be easy for Australian exporters to start their businesses due to high barriers to entry. Although some of the barriers have been eliminated through deregulation (which brought more transparency in trade and investment regimes), the Indonesian bureaucracy remains ponderous (export.gov, 2012). Competition from companies operating in China, Japan, Malaysia and Singapore can be difficult to overcome, and therefore may lead to significant profit losses. 

Overall, opportunities for Australian exporters in Indonesia appear to outweigh the possible challenges. Nevertheless, when engaging in trade business, important factors need to be considered in advance. Australian companies are highly recommended to visit the Indonesian market before they decide to enter it in order to find and choose the right agent or distributor.  Similarly, they should be prepared to invest capital into making their representative in Indonesia the best service provider. It is also crucially important to take into account all hidden costs that are likely to arise in the company once it has been set up.  Starting a business in a foreign country is not an easy step to take and it requires a lot of knowledge, effort and patience. As a result, every single benefit and cost has to be critically examined before action is taken. 

Kristina Kovalenko, Project Manager - Export Council of Australia

References:

1.       Austrade (2012), “Indonesia Profile: Current Business Situation”, Retrieved from: http://www.austrade.gov.au/Indonesia-profile/default.aspx[Accessed 15/05/2012].

2.       Australian Government (2012), “Indonesia country brief”, Australian Government: Department of Foreign Affairs and Trade, Retrieved from: http://www.dfat.gov.au/geo/indonesia/indonesia_brief.html[Accessed 16/05/2012].

3.       BBC( 2012), “Indonesia’s economy grows at a slower pace”, BBC, Retrieved from: http://www.bbc.co.uk/news/business-17980123[Accessed 20/05/2012].

4.       Export.gov (2012), “Doing Business in Indonesia”,  Retrieved from: http://export.gov/indonesia/doingbusinessinindonesia/index.asp[Accessed 17/05/2012].

5.       RSJ International Freight Services- Your Global Logistics Partner (2010), “Trade and Business Opportunities in Indonesia”, Retrieved from: http://www.rsj-international.co.uk/News/2010/Trade-business-opportunities-Indonesia.html[Accessed 16/05/2012].

'Alternate' Channels Provide Significant Opportunities in the US

Last week the Export Council of Australia teamed up with Access USA to present part 2 of its webinar series entitled “Accessing Virtual Channels in the United States.” We were lucky enough to hear from in-market specialists with combined experience of over 50 years in catalog and mail order. Stephen Farell is a senior buyer with catalog heavyweight Hammacher, Schlemmer, and Dale Talbott of Essex Sales and Marketing sells to about 80 catalog accounts in the States. 

The webinar explored opportunities in the catalog and mail-order consumer market, a potentially lucrative alternate channel typically overlooked by Australian companies. As the United States continues to recover from a major recession, it remains home to the largest consumer market in the world.  The United States catalog and mail-order sector brings in over $US 360 billion dollars annually generating purchases from 50% of Americans. Before the internet, mail-order took an estimated 18% of the US dollar spent and many assumed that the rise of e-commerce would lead to its demise. However, in reality the internet has not reduced but increased sales, reason being that most catalog merchants now have websites in addition to ‘hard-copy’ issues.  

Catalogs continue to play a very important role in the US retail sector for the following reasons: 

1. Convenience

Print catalogs are extremely easily accessible, easy to navigate and a trusted source of product information. 

2. Information Rich

All information is provided in an easy to read ‘hard copy’ format allowing consumers to make informed purchasing decisions. Use of QR codes and Augmented Reality now streamline the interface with online content and enhance the sensory experience.

3. Brand Building

Catalogs provide ‘quality time’ with your customer in what is becoming an increasingly time poor society. Strategic use of editorial enhances the customer experience, reinforces brand imagery and strengthens the connection with your product/company thereby increasing brand loyalty.

4. Targeted Distribution

The digital world is also playing a vital role in targeting distribution of catalogs to optimize impact and sales. Online retailing data is used to identify ‘hot’ prospects with specific interest in your product category. QR codes are now being used to help drive the consumers to purchase online via smart phone devices.

5. Sales

A significant number of global brands still regard catalogs as their number 1 sales tool. Effective sales processes and data capture incorporating online, call centre and retail can measure the success of marketing campaigns very quickly and make marketing departments more agile to changing trends. Personalised URLs printed in catalogs can be used to track sales-per-page figures and to optimise the layout of future editions. 

6. Driving E-Commerce

When an order is made online the company will send out the next catalog with other relevant products, acting as a reinforcement of the customer’s purchase. ‘Catalog codes’ placed with descriptions of an item shown in a catalog allow buyers to easily find their product online. Also, when a potential buyer visits the internet it allows the company to show other related products the buyer may be interested in.

Target Catalog Consumers 

The more than 7,000 US mail-order companies target several American consumer segments. Australian exporters can carefully target specific market segments through their choice of catalog.  

Catalogs are perfect for Australian exporters looking to target a niche market. Webinar presenter Stephen Farell’s own company, Hammacher, Schlemmer is considered an upscale catalog with most products priced from $US 50 dollars to over $US 1,000 dollars.  Mr. Farell explained a successful product of around $US 99 dollars would run for a full year selling about 5,000 units per year. One product featured in the catalog that has sustained popularity is the innovative Australian designed Sand Mat. This beach accessory allows sand to fall through surface of the mat. Mr. Farell explains the high end product would not sell in a retail store because a customer would simply see it as an overpriced beach mat. Customers purchasing from the high end catalog Hammacher, Schlemmer, however, identify with the product’s demonstrable value.  

Catalogs are also great for Australian companies looking to export specialized products, for example Swiss Colony, a mail-order company specializing in an extensive line of meat, cheese and other gourmet snacks.  Specific demographics can also be targeted through catalogs like the upscale women’s clothing line Victoria’s Secret.  Australian exporters looking to introduce a product to the US market should consider the catalog as a way to establish a product on a national basis relatively quickly. 

The US catalog and mail-order market is just one of the alternative channels Australian companies should consider when looking to export to the US market. 

For further exporting opportunities, tune in to Part 3 of the Export Council’s webinar series, “Accessing Virtual Channels in the United States” which will explore opportunities in the largest and most sophisticated e-commerce market in the world.  We will have a senior Amazon executive joining us all the way from Amazon headquarters in Seattle. 

Date: Thursday, 28 June 2012
Time:  9.00am (AEST)
Speakers: Jeff Gray, DC Marketing & Pablo Celi, Divisional Merchandise Manager - Amazon.com Inc

If you would like to participate please e-mail Lisa McAuley at lisamcauley@export.org.auwith full contact details including your membership status. Invoices will be issued for non-members upon registration.

-Meilssa Baker, International Project Co-Coordinator, Export Council of Australia 

A Level playing field is great but not when you are the only one playing on it!!

I find it very easy for people to talk the talk when it comes to Australia’s position on being internationally competitive however I can’t see a lot happening to improve the situation or make life a bit easier for our exporters, many of whom remain under pressure from a whole host of issues not to mention the dollar. The fact is, and it’s quite sad really, that it’s the Governments across Australia that by and large are the major culprits. They are pushing up cost through inflicting yet more and more regulation and believing  the world of trade is a ‘level playing field’ and therefore market forces will be the only factor in sorting things out in this very complex situation. I really wish it was that easy.

Let me reference three pieces of data that I recently read. The first is the World Bank’s annual “Doing Business” review for 2012 which looks at the rules and regulations that affect companies in 183 economies. When measuring ‘Ease of doing Business’, Australia’s ranking has fallen from 11 in 2011 to 15, the largest fall among any of the major economies. More importantly in terms of ‘Trading across Borders’ Australia ranks 30, behind Singapore number 1, Korea 4, and Finland 6. With the USA, New Zealand and the UK all ranking ahead of Australia.

The fall of, course is one thing and perhaps the high dollar has influenced that to some extent, but ranking 30 in terms of ease of trading across borders is not something to be proud of. If memory serves me correct that’s not much improvement on where we were three years ago.

The second report I would like to reference is the IMD 2012 World Competitiveness Rankings which ranks Australia’s international competitiveness at 15, compared to 9 in 2011 and 5 two years ago. Hong Kong, USA, Sweden, Norway, Germany, and Canada are all ahead of Australia. Why? The simple truth is these countries do it better and cheaper than we do and while again the dollar has had an impact we cannot blame that alone for a fall in rankings like that.

The third is the Productivity Commission draft report on Export Credit Arrangements which was released in May. Those of us in export were astonished and the number of submissions sent in after the draft was released would support this view. Here we are facing really difficult trade conditions and the commission recommends shutting down the assistance given by the Export Finance & Insurance Corporation for major projects and recommending that they focus all their attention on companies at the smaller end of the SME sector for a limited number of export transactions. Quite unbelievable I know. First, it can be quite strongly argued that the banks will not service these major projects that EFIC supports, so who in the world is? Second, if EFIC is confined to a limited number of transactions among smaller SME’s, how, may I ask, can EFIC survive? Is this recommendation going to make Australia more competitive? Not really.   

I have to admit that I agree fully with the Hon Stephen Martin the CEO of CEDA who was quoted recently in the Australian Financial Review, “Australian exports” he said “are being strangled by the high cost of labour, red tape upon red tape, duplication of Government regulation, the GFC and of course the Aussie dollar.”

There are obviously a significant number of things that need to done.  I agree with Professor Martin that Government needs to promote skills development particularly in sciences, research and technology, but I would add that it’s equally a business responsibility. At the same time Government must go all out in attacking unnecessary regulation and cost and bureaucratic impasses which serve no other purpose than creating non productive jobs. Government too needs to look at the levels of support provided by other Governments, including finance support, around the world and focus on programs that will build our potential rather than assisting only when market failure, in someone’s opinion, may result.

Being internationally competitive should be a major priority for all of us. A level playing field is great but not when you are the only one playing on it.  Come on Australia, let’s get aggressive!!!

On 24th August 2012 the Export Council of Australia and Shipping Australia are holding a seminar in Sydney on International Competitiveness. Look out for the announcement on our website: www.export.org.au

Ian Murray is the Executive Director of the Export Council of Australia

World ranking slides for Australia’s International Competitiveness

“The fall in Australia’s competitiveness ranking should be taken very seriously by Government & Industry,” said Ian Murray Executive Director of the Export Council of Australia. Today’s announcement in the Australian Financial Review has Australia’s world ranking falling to fifteen, ten places lower than it was two years ago.

Mr. Murray said that “the report by the Committee for Economic Development in Australia (CEDA) and the comments expressed by CEDA Chief Executive Professor the Hon Stephen Martin reflect what the council has seen emerging in export now for the last two years.”

 “Australia’s exports”, he said “are being strangled by the high cost of labour, red tape upon red tape, duplication of Government regulation, the GFC and of course the high Aussie dollar.”

Quoting a recent paper prepared by the Export Council of Australia, where it argued that while resources are booming there was clear evidence that even that sector was being hamstrung by unnecessary regulation, high taxes and massive difficulties in securing labour. The debate on ‘guest labour’ is but another issue that if not handled properly will result in the slowdown of projects vital to Australia’s wellbeing.

“The issue on whether the resources sector will continue to boom while important it is not the only issue on the table. Diversity of exports was a key factor,” Mr Murray said in “assisting Australia handle the GFC and it will continue to be a factor in the future. Those countries that concentrated on the services industry for example were really hurt during the crisis.”

Australia, Mr Murray said “needed to have a strongly balanced portfolio and focus attention on high value high technology sectors.”

“The Export Council,” he said “strongly supported the comments expressed by Professor Martin particularly those relating to the need for an increased investment in skills, particularly in science, research and technology. Despite the high dollar Australian companies in high-tech manufacturing and services to the resources sector, to name just two, remain quite strong.” Mr Murray said.

“On the issue of what should be done,” Mr Murray said “they had no argument at all with Professor Martin. Government needs to promote skills development, focus on skilled migration, including those under Enterprise Migration Agreements as well as promote R&D and most importantly attack over-regulation and trade facilitation costs. Companies must focus on innovation driven by excellence in R&D that will strengthen their competitive advantage and enhance their margins.”

“Being number fifteen is simply not good enough in a country blessed with resources, good education and natural ability.  Australia cannot afford to be apathetic. Government and business,” Mr Murray said “need to work together to realise the potential we have sitting right at our feet even if that means making decisions that some sectors won’t like.”

Ian C Murray AM
Executive Director
Export Council of Australia