Australia today is economically sound, culturally vibrant, and offers a secure Asia-Pacific location.

In the 1980s, a concerted push by our tourism industry led to worldwide images of Australia virtually brimming with suntanned beachgoers who gathered at regular tribal-like events that required slinging shrimps on a sizzling hotplate (aka the weekend barbecue), and conversing in a type of ‘murdered’ English (aka Aussie slang). And while the world was becoming mesmerised with our crocodile-wrestling larrikins, Neighbours and cutely distinctive fauna, Australia was coming of age as a nation.

The Lucky Country
While Australia remains a stunning tourist destination, what our tourism brochures don’t highlight is that today’s Australia is also business-savvy, economically street-wise, and an excellent trade and investment location.

From our history, steeped in romantic images of rugged, yet isolated beauty, emerges a country often ranked as the preferred investment destination in the Asia-Pacific region. The metaphors of hard-fought yards through toil and adversity – imprinted so strongly on our nation’s psyche – are now giving way to successful industry reform and impressive GDP growth. The fact that Australia’s economy escaped recession in 2001 while global markets were experiencing a downturn was in no way due to our once-held cultural belief of being the ‘Lucky Country’. It was simply because Australia, in comparison to economies affected badly by the ‘tech wreck’, had its investment eggs spread across many more baskets.

In a rapidly-changing world marked by increased globalisation, new technology and the infiltration of e-commerce and internet technologies, not only has Australia’s economic performance in recent years been among the best in the world, the outlook continues to remain bright.

With further advantages like high productivity, a stable business environment, and access to highly skilled people and innovative technologies, it comes as no surprise to find that many multinational companies have chosen to call Australia ‘home’.

Founded on trade
Australia’s first recorded trade transaction took place in 1788 and involved the exportation of live, human cargo from Great Britain. Otherwise known as the arrival of the First Fleet, this event marked the commencement of settlement by Europeans.

Since then, the commercial relationship between Australia and Britain has gone from strength to strength. In January 2000, Australia was Britain’s fifth largest market for goods outside the EU. By January 2001, the UK’s exports to Australia had grown by 29%, while Australia’s exports to Britain had increased by 22%.

Australia’s main exports to Britain in 2000/2001 included just over A$400m of non-metallic mineral manufactures, and beverages (meaning wine) to the value of nearly A$810m, equivalent to almost half all Australian wine exports.

With regard to investment, Britain is the second largest foreign investor in Australia after the United States. Similarly, Australia’s rate of direct investment in Britain is second only to its levels of investment in the USA, making Australia Britain’s sixth-largest inward investor.

British inward investment includes companies such as Virgin Blue, Filtronic Comtek, Acorn Nisil, SIMS, and Smiths Aerospace to name a few, while AMP, National Bank’s subsidiaries and Lend Lease have all touched down on British soil. Additionally, Mount Isa Mines has established a number of plants in the UK, making it one of the more notable players in minerals processing.

Investments like these, which improve technology, build skills and provide jobs – often demanding high levels of expertise – are not the only benefit of the commercially strong relationship between the UK and Australia. There is also an important regional dimension to the business relationship between our two countries.

For Australian firms, Britain is not only an attractive market in its own right but a springboard for doing business in other parts of the European Union. Likewise, more than 100 British companies use Australia as their regional HQ for the Asia Pacific.

So what do all these British companies know that you don’t? And why should you consider Australia as your next investment location?

The Australian advantage
A number of independent reports have confirmed what we’ve known in Australia for some time – that is, we offer a strong and secure base for business.

Both the latest OECD report, Economic Outlook 2001, and the International Monetary Fund’s latest forecast predict that Australia will not only weather the current global downturn, but GDP growth will jump to a strong 3.3% in the coming year.

The OECD’s report in particular found that major reforms together with our competitive exchange rate have contributed to Australia remaining stronger than most other countries. In addition, the report found that stronger business investment will underpin accelerating growth in the Australian economy in the next two years, thereby ensuring that Australia will remain as one of the fastest growing economies in 2002/3. Over the course of next year, Australian business will outlay an estimated A$41bn on new capital expenditure – a 6.5% increase on previous estimates. As Professor Warwick McKibbon, Reserve Bank Board member, says “the data suggests that things here are in reasonably good shape.” This view is shared by Solomon Smith Barney’s Chief Economist, Paul Brennan: “Australia has a good story to tell. The economy is reasonably resilient, performance over the past five years has been good in the global context and there are good investment opportunities for overseas companies here.”

High-flying sectors
The fastest-growing industry sectors in Australia include biotechnology and information and communications technology (ICT). Rapidly emerging industries include renewable energies and nanotechnology.

The ICT industry in Australia employs more than 200,000 people, with around 19,000 businesses generating a combined annual income of A$63bn. Globally, Australia is ranked second among OECD nations in ICT spending, while according to the Economist Intelligence Unit, Australia comes second only to the US in ‘e-readiness’.

But it’s not just Australia’s ICT sector that’s pushing past the boundaries. Today, the Australian biotech sector is exploding, with more biotech companies per capita than the US.

A report released in 2000 showed that Australian biotechnology patents taken out in the US have increased 250% in recent years – more than double the rate of increase of such patents from the rest of the world. Meanwhile world demand for biotech products and services is forecast to reach A$50bn by 2005. Australia plays a critical role in this growth sector.
Other ‘stars’ set to shine in 2002 include gold exports, the wheat industry, and the mining sector.

Gold exports are tipped to jump by almost 12% in 2001/2 according to Australia’s chief commodities forecaster, the Australian Bureau of Agricultural and Resources Economics (ABARE), while the wheat industry is set for one of its best years in decades with potential record returns. The buoyant environment was reflected in the first results of the wheat marketing body, AWB Ltd, which included a 32% increase in net profit to A$83.7m for the year to 30 September 2001.

On the other hand investment in the mining sector has soared to its highest level since September 1999, with the focus of spending being key minerals projects. These projects include: the Rio Tinto-Robe River, West Angelas joint venture; Australian Magnesium Corp’s A$1.4bn magnesium plant in Central Queensland; and Rio’s A$425m coking coal project in North Queensland. Additionally Woodside Petroleum is investing A$1.6bn in a major brownfields expansion on the NorthWest Shelf.

Research and development
Situated in a premier location for high-value, low-cost technology and innovation, Australia’s R&D institutions have an excellent international reputation, ensuring that Australian-based companies are well placed to pursue opportunities into the 21st century. The Federal Government’s strategy Backing Australia’s Ability, released early in 2001, announced R&D tax concessions up to 175%. With the addition of various other incentives, and one of the highest levels of intellectual property (IP) protection in the region, it’s not surprising that an increasing number of companies from around the world are choosing to locate their global or regional R&D facilities in Australia.

Encouraging efficiency
At the microeconomic level, the Australian Government’s agenda over the past few years has included a focus on encouraging industry efficiency. With this in mind, the Government has implemented a broad platform of reform initiatives aimed at reducing industry costs, and providing a business environment that is conducive to high growth.

In a global context, Australia has continued to strengthen its foundations and further increase its international competitiveness. Added to this is the Government’s renewed focus on attracting overseas investment into Australia, which will ultimately have significant implications for Invest Australia – the Australian Government’s national investment promotion and facilitation agency.

A wise economic choice
Australia’s continued strength – within a region that has seen its growth projections revised down – highlights the continuing importance of policies supporting sound macroeconomic fundamentals, innovation, and entrepreneurship in the ‘Australian Advantage’ mix. A decision to invest in Australia not only represents considerable cost advantages, it also represents a wise economic choice.

Invest Australia means business
With all the competition for your business, sometimes the facts can become clouded. Invest Australia can help clarify your decision, saving you valuable management time and money.

As the Australian Government’s inward investment agency, Invest Australia offers a comprehensive, free and totally confidential service for potential investors.

Working in partnership with business and government, Invest Australia can provide your company with all the information needed to establish or expand a business in Australia. We also assist by connecting you with the right contacts, as well as providing information on investment regulations and government programmes.

With Invest Australia’s international network spanning 15 locations throughout Australia, North America, Europe and Asia, you gain access to the right information and the best people to help with your unique requirements.

Invest Australia can:

• provide information on how to
  establish a business in Australia;
  
• arrange site visits and help you find the right joint venture partner;
  
• offer you specialist advice from our range of industry specialists;
  
• provide information on the
  availability and cost of labour, R&D, transport and establishment costs;
  
• provide contacts with key
  government agencies and advice
  on investment regulations;
  
• advise on local, state and federal incentive schemes;
  
• help you by providing grants to undertake pre-feasibility and
  feasibility studies for major
  investments; and
  
• facilitate projects through the Major Projects Facilitation and Regional Headquarters programmes.

Off the sheep’s back
The days when Australia’s success ‘rode on the sheep’s back’ has long since passed. The Australia of today is economically sound, culturally vibrant, and offers a secure solution for those companies seeking to invest in the Asia-Pacific region. Australia has more to offer than the holiday of a lifetime snorkelling the Reef or climbing the Rock – more importantly it’s about hanging out the shingle that says Australia is ‘open for business’.
Why not contact us today to find out how Invest Australia can assist you, or visit our website for all the latest information on Australia’s investment advantages.

Barry Jones,
Executive General Manager,
Invest Australia.

For further information:
Invest Australia
National Investment Response Centre, Sydney
Telephone: +61 2 9397 1600
Fax: +61 2 9397 1666
Email: nirc@industry.gov.au
Website: www.investaustralia.gov.au