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Australia and New Zealand

Out of the Ashes comes business. Australia and New Zealand. Explore Export 2011. Contents. Australia economic & political overview Australia challenges & opportunities New Zealand economic & political overview New Zealand challenges & opportunities

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Australia and New Zealand

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  1. Out of the Ashes comes business... Australia and New Zealand Explore Export 2011

  2. Contents Australia economic & political overview Australia challenges & opportunities New Zealand economic & political overview New Zealand challenges & opportunities Why do business in Australia & New Zealand? Opportunities for British business What we can do for your business

  3. Australia - Overview

  4. Australian economic/political overview • World’s 14th largest economy, GDP approx US$1 trillion • Annual GDP growth rate 1998-2009 average 3.5%, significantly higher than US, UK, Japan, France and Germany • The only advanced economy not to have fallen into recession during the recent economic downturn • Ranked as the world’s most resilient economy for six out of the last eight years* • Service industries make up approx 70% of economy, manufacturing around 10% and mining and construction around 8% each** *IMD World Competitiveness Yearbook, 2009 ** Australian Bureau of Statistics

  5. Australian economic/political overview • Australia has a sound, stable and democratic political environment that provides certainty to businesses • The UK is the second largest foreign investor in Australia, with stock worth AU$499 billion and invested another AU$34 billion in Australia in 2009 – 21% of total new investment* • The UK is Australia’s second largest trade services partner** • Over 1,000 British companies do business in Australia each day • Europe accounts for 34% of all foreign direct investment in Australia, creating around 1.4 million Australian jobs*** • Harvard Business Review named Australia as its No 1 country to invest in Jan/Feb 2011 *Australian Bureau of Statistics, 2009 **Department of Foreign Affairs and Trade (DFAT) ***Austrade, Sept 2010

  6. Australia – challenges/opportunities • Resources boom • How long will the boom last and what will replace it? • Strong dollar – exports and tourism suffering • Adapting to a larger population • Growth predicted of 65& (35 million) by 2049 (fastest in OECD) • Will cause housing/water/power/infrastructure/enviro challenges • Skills shortage in mining and construction • Shortage of engineers, construction industry professionals and skilled tradespeople • Aging population/rising healthcare costs • Moving to a lower carbon economy – overdependence on cheap fossil fuels • Developing the National Broadband Network

  7. New Zealand - Overview

  8. New Zealand economic/political overview • New Zealand has a sound, stable and democratic political environment that provides certainty to businesses • Biggest trading partner is Australia, followed by China, US, Japan and UK – UK exports with NZ worth £390m in 2010 • NZ economy generally performing well compared to other advanced economies despite effects of earthquake – GDP 2011 forecast is 1.4%* • World’s 2nd easiest country to do business** • Worlds least corrupt country (equal)*** • Services account for around two-thirds of New Zealand’s GDP and manufacturing almost 20% • Significant proportion of NZ exports based on primary production, followed distantly by ICT and pharmaceuticals *NZ Treasury ** The Economist, June 2010 ***Reserve Bank of New Zealand

  9. New Zealand – challenges/opportunities • Free Trade Agreements (FTAs) • NZ has signed multiple FTAs with major trading partners China, ASEAN, Singapore in previous five years • First OECD country to sign FTA with China (2008) – since then NZ exports to China have increased 37% • Christchurch earthquake February 2011 • Estimated NZ$11 billion damage bill • Big opportunities for UK companies in rebuilding infrastructure • Government debt rising • Cumulative operating deficits and weakened balance sheet could disrupt major public spending and ability to weather future shocks • Science and innovation • Govt technology grants and voucher schemes present opportunities for UK businesses – especially in clean tech and venture capital

  10. Why do business in Australia and New Zealand?

  11. Why do business in Australia & NZ? Strong economy • Stable economies with good current and future growth prospects Business, legal & cultural similarities • Familiar business, legal & regulatory framework • Common language & customs • Strong IP protection • Many British businesses already there • High regard for UK products Gateway to Asia • Skilled, educated, multi-lingual workforce • Asia still the region of the world with the highest potential growth Quality of Life • 5 Australasian cities in world’s top ten most liveable cities* * The Economist, Liveability Ranking, 2010 11

  12. Australian sector opportunities

  13. Opportunities – Oil & Gas • 5th largest oil and gas industry in Asia Pacific and 14th in the world (worth A$100 bn) • More than A$87 bn predicted spend on new petroleum projects in next 10-15 years • Oil and gas industry predicted to grow at two to three times economy for next 15-20 years • A$43 bn Gorgon, Ichthys and other very large LNG projects expected to provide significant opportunities for UK companies • 5 major areas of opportunity for UK companies within Oil&Gas are Subsea, Health & Safety, Skills & Training, Science & Technology and R&D

  14. Opportunities – Biotechnology • Australia biotechnology hub of Asia-Pacific, world’s 6th largest market • Aust. health system spend in 2006-07 A$90 bn (£50 bn) • Expected to increase to A$110 bn by 2012 • Fast growing and aging population expected to greatly increase market size • The sales of medical devices in Australia amounts to around A$2.5 billion per annum (£1.4 billion) • Australia’s Nation Building plan includes significantly increased funding for local healthcare infrastructure

  15. Opportunities – ICT • Already one of the best prospects for UK businesses in Australia, consistent streamof ICT companies succeeding in Australia • A$43 bn National Broadband Network (NBN) planned to cover 98% of Australia in 10 years, will further expand opportunities and provide surety • E-health, e-utilities, e-learning and smart grids likely to be big growth areas

  16. Opportunities – Low Carbon • Environment and low carbon worth A$22 billion - expected growth of 7% pa • A$2.3 billion Govt assistance package to encourage innovation and investment in clean energy technology • A$20 billion required to meet Australia’s renewable energy target alone, estimates suggest • Big opportunities for UK companies, particularly in joint ventures and using Australia as gateway to Asia • CPRS scheme delayed to 2013 • Australia recognised by UKTI and British environment industry as high opportunity market

  17. Opportunities – Food & Beverage • Strong opportunities for foodstuffs and allied processing technology with favourable exchange rate • Two supermarket chains in Australia claim 70% of the market, but this is being eroded by cut price and high end retailers • Majority of private label products sourced from overseas • Australian consumers won’t preferentially ‘buy British’ but tastes and culture are aligned well with UK

  18. Opportunities – Education • Education makes up 4.4% of Australia’s economy • Australia already imports A$330 million in printed matter from the UK • A$1 billion govt funding announced in 2009 to build science laboratories and language learning • And A$1.6 billion for infrastructure investment and facilities in the training and higher education sectors

  19. Opportunities - Business & Financial Services • Australia’s largest contributor of GDP – approx. 70% • Sydney and Melbourne financial hubs for Asia Pacific after Hong Kong and Singapore • Australian Stock Exchange (ASX) world’s 8th largest, possible take over by Singapore Exchange in 2011 • Aussie banks had low exposure to financial crisis and banking system remains strong • World leader in sophisticated retirement products due to compulsory ‘super’ • Strong opportunities in fund and wealth management, Islamic Finance, M&A advisory, Forex, Project Finance

  20. New Zealand sector opportunities

  21. Opportunities • Infrastructure • Rebuilding Christchurch’s infrastructure after the earthquake • Electrification of Auckland regional rail network & Auckland city rail loop • ICT • National Broadband Network and Rural Broadband initiatives worth NZ$1-3 bn • Digital media opportunities arising from improved broadband and digital TV network • Software – Opportunities in health IT, educational resources, e-government • Medical Technology • NZ has one of the best funded public health sectors in the world • Imports of $1bn of medical devices each year • Life Sciences • World leader in research and development Including: therapeutics, diagnostics, regenerative medicines,  industrial bio processing, bio fuels, specialism in cancer, diabetes and other similar diseases

  22. Opportunities continued • Renewable Energy • Best wind, wave and tidal resource in the southern hemisphere, including: • Marine Energy Centre project • Geothermal projects • Biomass/ Gasification • Agriculture • Opportunities for farming equipment, breeding, genetics, fertilisers • New rules opening door for imports of Pork and Turkey products • Oil & Gas • Huge potential offshore reserves of Oil & Gas • Some commentators calling NZ the ‘Southern Saudi’ • Several companies actively exploring NZ waters • Very favourable market for companies with North Sea expertise in deep water

  23. Opportunities continued • Education • Development of ICT infrastructure in education is a priority for NZ Gov • Noticeable shift in procurement from physical to digital/online resources • Creative Industries • High-performing creative computer services & gaming developers • British music continues to be an area of opportunity in New Zealand • Internationally successful film industry particularly in areas of animation & post production • Marine • The marine industry is estimated to be worth NZ$2.2b to the NZ economy • One of the highest rates of boat ownership per capita worldwide • Rugby World Cup 2011 • More than 80,000 visitors worldwide travelling to NZ for the rugby • UKTI hosting business networking event for British & New Zealand businesspeople on Thursday 29th September in Auckland

  24. What we can do for your business

  25. What can UKTI Australia & NZ do for you? • Local knowledge: Tailored, experienced, impartial advice to maximise your chances of succeeding in Australia • Product launch: In one of our function rooms, available in most capitals • Introduction service: To prospective business partners, distributors, suppliers and Australian Govt bodies • Promotion: PR to local media, UKTI e-newsletters, emarketing and social media campaigns • Test the Market: Reduce the cost, risk and time of establishing your business in Australia by working in one of our business centres • The ANZ OMIS - Joint Overseas Market Introduction Service (OMIS) offering for both countries

  26. My contact details Paul Noon Deputy Consul-General & Director of Trade, Australia and NZ Email – paul.noon@fco.gov.uk Twitter @uktiaustralia @uktinewzealand Websites //ukinaustralia.fco.gov.uk/en/business //ukinnewzealand.fco.gov.uk/en/business

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