Australia is well positioned to further substantiate itself as the “pre-eminent gateway” into Asia for Western businesses, argues HSBC chief executive Stuart Gulliver.
In a speech to the Australian British Chamber of Commerce on Monday, Mr Gulliver said an increasing number of businesses are investing in Australia to gain exposure to China and other Asian economies.
According to Mr Gulliver, in order for Australia to take advantages of these opportunities, both Australian policymakers and businesses need to prioritise two key areas – reducing trade barriers to foreign markets and encouraging business innovation.
“The conclusion of the China-Australia Free Trade Agreement was a hugely significant milestone that gives Australia a monumental advantage over China’s other trading partners.”
Mr Gulliver said in addition to the free trade agreement, there are a number of alternate initiatives that can serve to enhance Australia’s relationship with China.
The ASEAN Economic Community, set to launch next year, will provide Australia with further access to free trade markets within the region. Moreover, the Trans-Pacific Partnership will be a building block for trade liberalisation across Asia.
“Not only will this help to revive lacklustre exports over the coming years and provide a boon for the Australian service, high-value manufacturing and agricultural sectors, but this agreement will pry open sheltered domestic markets, spurring much-needed reforms.”
Mr Gulliver said it is also imperative that policymakers encourage innovation and improve the operating environment for local and foreign businesses.
Mr Gulliver suggested than an Australian equivalent of the UK Business Growth Fund be established.
The growth fund was founded by five UK-based banks to fill the void between start-up finance and mainstream venture capital funds. To date, Mr Gulliver said the fund has invested approximately $1.3 billion in more than 100 companies – with turnover in those businesses increasing roughly 20 per cent.
“By making its case, playing its full role in new trade agreements and ensuring there is a conveyor belt of innovative businesses ready to seize on new opportunities; Australia can accelerate its own economic development, and cement its position as the gateway to Asia.
“[Australia’s] access to the East is firmly to its advantage – and it is increasingly benefiting both businesses and investors here, and around the world,” he said.
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