13 May 2008
Government delivers on commitment to revitalise Export Market Development Grants (EMDG) scheme
Australian small and medium sized businesses taking their products to the world will benefit from the Government providing an additional $50 million in 2009-10 to the Export Market Development Grants Scheme (EMDG).
Minister for Trade, Simon Crean, said that the Rudd Government has delivered on its election promise of modernising the EMDG scheme to help rebuild Australia’s export culture.
The EMDG scheme is administered by Austrade and assists export-focused small and medium sized Australian businesses to enter the export market. The funding injection will bring the total amount available to exporters under the scheme to $190 million in the 2009-10 financial year.
“Exporters who incur expenditure during 2008-09 in the expectation of receiving assistance through EMDG in the early part of 2009-10 can do so knowing the Rudd Government’s new criteria and increased resources will be in place,” Mr Crean said.
“This is in stark contrast to the previous government, which changed the EMDG criteria but created a significant funding shortfall by providing no additional funding for the program.”
The funding boost also reverses the trend under the previous government, which cut by half the real value of grants from their 1995-96 level.
“The previous government promised in 2001 and 2004 to double the number of exporters but, since 1995-96, it halved the real value of the scheme that assists exporters. Its failure to fund the changes it made to EMDG meant that some exporters have been getting less support than they should have.
“The shortfall in this funding was a direct result of the previous government’s neglect of Australia’s export sector. It is why the previous government had no credibility with regard to EMDG.”
To further improve the ability of the scheme to assist businesses, the Rudd Government is making a number of enhancements which will apply to export promotional expenditure incurred from 1 July 2008 and will affect grant payments made in 2009-10.
Mr Crean said legislation to give effect to the EMDG enhancements had already been introduced into the Parliament and will deliver on Labor’s election commitments in regard to EMDG.
The EMDG enhancements will:
- increase the maximum grant by $50,000 to $200,000;
- extend the scheme to the costs of patenting products overseas;
- allow approved regional not-for-profit economic development bodies, including tourism bodies, which promote Australian exporters to access the scheme;
- lift the maximum turnover limit from $30 million to $50 million;
- cut the minimum threshold of expenditure by $5,000 – to a $10,000 minimum;
- extend the limit on the number of grants from seven to eight annual grants;
- replace the list of eligible services provided in Australia with a negative list, which means all services will be considered eligible unless otherwise specified; and
- introduce an additional performance measure for applicants that have already received two grants.
As part of the Budget process, the Government’s investment promotion and Global Opportunities programs will also be integrated into Austrade.
This decision reflects the changing nature of world trade, where investment flows and global supply chain issues increasingly dictate patterns of export activity.
“For the first time we will now have a single integrated service for globalising Australian businesses – a service that reflects the new realities of trade and investment,” said Mr Crean.
The Government has announced a comprehensive review of Federal Government export policies and programs led by noted business figure David Mortimer. The Mortimer Review, to report by 31 August, will examine in detail further aspects of the EMDG scheme to encourage more businesses to export and existing exporters to expand their export base.
“To secure our future beyond the resources boom, we must engage more strongly with the world on trade and investment.”
“World trade is growing at three times the rate of world output. The clear message is that a country’s trade performance is critical to its economic performance,” Mr Crean said.
Media Inquiries: Mr Crean's office 02 6277 7420 - Departmental Media Liaison 02 6261 1555