Address by The Hon Tim Fischer MP, Deputy Prime Minister, Leader of the National Party, Minister for Trade, to Chief Executive Officers of Major Swiss Companies Located in Australia and Members of the Swiss Australian Chamber of Commerce and Industry , Canberra, 25 June 1997

Introduction

Ladies and Gentlemen

I am delighted to have this opportunity today to exchange views with you and to talk to you a little about the advantages Australia offers for investment.

I welcome this opportunity because I recognise that Switzerland is one of the world's leading investors and traders. Indeed our bilateral relationship with Switzerland is ample evidence of this. Switzerland ranks 7th as a source of foreign investment in Australia and Swiss investors include many household names.

This Government is committed to creating a competitive business environment to attract further investment from Australian and international firms and we have already made considerable progress:

• fiscal consolidation has made possible the lowest commercial interest rates in decades, and
• changes to the regulatory environment for small business and industrial relations reform are also assisting business.

The economic outlook is for strong growth, low inflation and faster employment growth. Real GDP growth is forecast to accelerate to 3¾ per cent in 1997-98, from an estimated 3¼ per cent in 1996/97.

Encouraging Regional Operations

What I want to emphasise to you today is that Australia offers investors like you the prime regional location to establish manufacturing and service operations, because we have:

• long-standing and extensive ties with the Asia Pacific region;
• an excellent executive skills base;
• less expensive commercial and residential accommodation and other business overheads;
• world class telecommunications and support servicesinfrastructure;
• an enviable lifestyle for expatriate executives; and
• a very robust economic and political base.

Australia has a strong science base, with R & D capacity across most industry sectors, and an R & D base in Australia costs less than most countries in Europe, North America or Asia.

To realise the potential of these advantages, the Government actively encourages the establishment of regional operations in Australia.

The Investment Promotion and Facilitation Program

Austrade and the Department of Industry, Science and Tourism, manage the Government's Investment Promotion and Facilitation Program. This Program is designed to facilitate investment and assist Australian businesses/projects with a need for foreign investment to identify suitable foreign strategic partners.

Since its inception in 1987 the Program has brought to Australia A$7.8 billion in new investment, 16,500 new jobs and an extra A$2 billion p.a. in exports. Since March 1996, the Program has been involved in 93 projects worth A$3.2 billion, creating 7,055 jobs and generating A$723 million p.a. in exports.

Of particular success has been the Program's Regional Headquarters marketing campaign which was launched in September 1993.

As at June 1997, there were a total of 345 RHQs and Regional Service Centres in Australia of which about 300 have been established since the campaign began and about 120 since March 1996.

The Federal, State and Territory Governments also offer further business and industry support through an extensive range of incentives and programs for companies considering Australia as their RHQ location.

The Opportunities of the Asian Region

I don't need to tell you that Asia is a dynamic economic growth region and that Australia is fortunate to be located so closely to the action

World Bank predictions have East Asia growing at over 7 percent a year to the year 2004. That's two and a half times faster than the rest of the world.

Australia has worked hard to become a dynamic player in the region's economy, and our growing economic integration with Asia continues: seven of Australia's top ten trading partners are in Asia, and almost two thirds of Australia's exports now go to Asia. That amounts to over 45 billion dollars worth of exports a year to Asia

Much of Australia's past success has been based on supplying the raw resources which have fuelled Asia's industrial development. That demand will continue to grow to some degree, but changing demand in Asia has meant that the strongest growth in our exports to Asia has been in manufactures and services.

Australian industry is developing the sorts of products and technology that regional countries need for long term growth.

And Australian professional services providers are helping countries in the region innovate and develop new ways of doing things. Our services exports to Asia now account for half of our global total services exports.

Australia's $14 billion per year processed foods industry supplies a significant percentage of Asia's food requirements. And we aim to increase our food exports through the Government's Supermarket to Asia initiative.

Our involvement in Asia is not exclusive, and is important in that it more closely links us into the wider global economy. Regional markets dominate our trade relations, but our traditional partners in Europe are the source of most investment in Australia.

That diversity is something we welcome. It places us in a unique position in the global economic environment, and demands of us a truly international outlook.

Conclusion

On that note, let me conclude. Thank you again for this opportunity to speak to you today, and let me assure you that we are keen to work with you in making the most of the great opportunities that await in this dynamic region.