Trade and commerce have a special dynamic in
the relationship between Australia and the UK.

The year 2002 is shaping up as another vital one for Australia-UK business, despite the turbulence which has swept the world since September 11.

The Commonwealth Heads of Government Meeting, postponed from October, was finally held in early March when the leaders of more than 50 Commonwealth nations met at Coolum. Discussions were substantial and the organisation impeccable – no surprise given the benchmarks Australia set during the Sydney Olympic Games.

Alas, the Commonwealth Business Forum was a casualty of September 11. But though cancelled in the aftermath of the attack on New York, the Commonwealth Business Council continued its work and presented CHOGM with a report which set out 16 investment principles – guidelines the leaders endorsed resoundingly. The Council has also produced two publications from the numerous papers prepared by guest speakers for the original three-day event. These offer valuable insights by business leaders from across the Commonwealth in addressing the Forum’s theme, ‘The 21st Century: New Economy, New Challenges, New Opportunities’.

Eager for challenges
British and Australian businessmen have shown themselves eager for new challenges and alert to new opportunities. Trade and commerce have a special dynamic in our relationship.

Take investment. Throughout the 1990s, Australia has consistently been one of the five largest external investors in the UK, and often the third largest, ahead of Japan and Korea. Total Australian investment in Britain stands at more than A$65bn, second only to the rate of investment in the United States. UK investment in Australia, which has grown by a remarkable 112% since 1994/95, now stands at more than A$178bn.

Trade, too, continues to flourish. Taking products and services together, Britain is Australia’s third largest trading partner, and the sixth largest merchandise trading partner. Two-way trade in goods and services totalled A$17.9bn in 2000. The UK is the fourth largest supplier of merchandise imports to Australia and the eighth largest destination for Australian exports. The UK is the only European economy in Australia’s top 12 export markets, and it remains Australia’s largest market for wine, totalling around A$742m and accounting for nearly half of Australia’s wine exports.

Ties and similarities
There are many reasons why our commercial ties are so strong. Common language, similarities in the way in which we do business, familiar expectations – all these play a part. Location is important. Britain is not only an attractive market in its own right but also an ideal base for doing business in Europe – this at a time when the EU is pressing ahead to admit up to 12 new members. In the same way, Australia is an excellent location for European firms in the Asia Pacific. British firms make up half of all European company regional headquarters in Australia.

Tourism is important. Boosted by the Olympics’ success, Australia continues to be a magnet for British travellers, with 613,100 Britons visiting in the year to July 2001. Australians, who love to travel, are visiting Britain in even larger numbers, with an estimated 735,150 visitors in 2001.
Despite a slowdown in the Australian communications industry, UK visible exports remain strong, totalling £2.3bn in 2001.

Our two nations are enjoying impressive levels of economic growth, despite nervousness around the globe. In Britain, nine years of expansion mark the longest period of sustained non-inflationary growth in more than 30 years. The Australian economic outlook is one of solid economic growth and continuing low inflation, with the IMF forecasting growth of 3.3% in 2002. We have everything to look forward to.

It is a pleasure to contribute to this latest edition of British Australasian Business and I invite you to join us in forging new links in the flourishing UK-Australia partnership – ties that will bring renewed vitality to our relationship in the years ahead.

Website: www.uk.emb.gov.au