Speech

Australian Minister for Trade, Mark Vaile

Australian-German Cooperation in the Asia-Pacific Region
German -Australian Business Dialogue
Sydney, 14 September 2000

Australia and Germany: Enriching the Bilateral Trade and Investment Dialogue

Introduction

I would like to thank you for the opportunity to speak to this important dialogue on Australia-German business relations. In particular I extend a warm welcome to the high-level business delegation from Germany and the many representatives from German companies operating here in Australia.

I also want to thank the German-Australian Chamber of Industry and Commerce and the Asia-Pacific Committee of German Business (APA) for organising this important event.

Australia: a strong and growing economy

The Olympics are both a national and international celebration. Your presence, and that of the many other thousands of visitors to Sydney, make it a perfect opportunity to showcase Australia as a dynamic, technologically advanced country. Add to this a lifestyle that is hard to match and you have some of the key reasons why Australia is such an ideal business and investment destination in the Asia-Pacific region.

The Australian economy has been expanding rapidly for close to a decade, with an average GDP growth rate of over 4 per cent during the last 7 years. This strong growth has been accompanied by low inflation, with an average rate during the 1990s of just over 2 per cent.

Australia is the 14th largest economy in the world. Our economy is nearly the size of the combined economies of Indonesia, Malaysia, Philippines and Singapore.

The pronounced rise in productivity in Australia has been associated with the Howard Government's reform agenda which has included financial market deregulation combined with sound corporate governance and prudential supervision, decentralisation of the labour market and taxation reform.

Major privatisation reforms in the banking, telecommunications, aviation, transport, energy and water sectors have increased competition and lowered business costs.

I note that there have been some parallel developments in Germany with recent major reforms of the taxation system. In Germany there has been intensive debate on reform of the superannuation system. The Australian superannuation system has been privatised for some years. Australian companies such as Colonial have extensive expertise in the field of superannuation funds management and are interested in investment possibilities in Europe.

A strong bilateral partnership

The Australian Government is committed to further enriching Australia's bilateral economic relationship with Germany.

There is already a strong base from which to grow. Germany is our ninth largest trading partner valued at A$7billion in 1999/2000. Germany also provides the 6th largest source of foreign direct investment in Australia, with total FDI now around $A5.9 billion. Companies like Siemens, Thyssen, Bayer and Hoechst are well established and we welcome the contribution they are making to Australia's impressive economic performance of recent years.

It was a great pleasure for me to attend Expo 2000 in Hannover earlier this year. Germany can indeed be proud of holding the largest Expo yet. Australia invested heavily in the Hannover exercise and it has been heartening to hear that our Pavilion emerged as one of the most popular at Expo.

Expo allowed us to highlight the consistent growth in Australian exports to Germany of elaborately transformed manufactures, in areas as diverse as electrical equipment, medical instruments and automotive components. Indeed ABS figures show that "electrical circuitry equipment" was the largest single Australian export item to Germany in calendar year 1999 exceeding traditional exports like wool.

Hannover also provided an opportunity to showcase Australia's fast growing environment technology and expertise. This is even more on display here in Sydney with these Games being the most environment-friendly ever held. A kit of materials detailing Australia's expertise and relevant contacts is available here today.

Business Club Australia: doing business during the Olympics

The Government's main effort to promote the business opportunities created by the Sydney Games is Austrade's Business Club Australia. I hope to see many of you at the Club over the next two weeks which is headquartered on one of our magnificent Australian made fast ferries moored at Wharf 7 in Darling Harbour.

The Business Club provides a global network of business contacts and has attracted more than 11,000 members from 87 countries since its launch in 1998. Club members will be able to participate in events being organised online and also at our Darling Harbour headquarters. While in Sydney the business centre will provide Club members with office and other facilities, including multi-lingual trade assistance.

On October 1 there will be a special networking session at the Club focussing on Germany. I understand that there is already strong interest in the session and would encourage any of you who will still be here on 1 October to attend.

Australia: your trade and investment hub

Over 430 multinational companies use Australia as a location for their Asia-Pacific management and/or service functions. Australia is home to around 800,000 Asian language speakers, ensuring that companies are able to draw upon skilled managerial and technical staff who are fluent Asian speakers. For these companies, Australia has been used as a centre for regional management, offering an ideal base for building operations across Asia's emerging markets.

Lufthansa's decision in 1998 to set up a call centre is a prime example of a recent successful investment by a German company in Australia involving a $5 million investment and 100 new jobs. I understand that Lufthansa has been very happy with the operation of the call centre.

Companies like Siemens and Bosch are further examples of German companies who have a strong involvement in Australia. In this regard I was delighted to see Bosch, a leading exporter of automotive components, win the Australian Export Award for large manufacturers in 1999.

Siemens secured a new three-year 358 million Deutschmark contract in late 1999 to deliver the next phase of the Internet networking backbone for Telstra. Of more immediate significance, Siemens will also be providing the lighting for the 110,000 seat Olympic Stadium where the opening ceremony will take place tomorrow night.

While talking on telecommunications, I would like to give a quick "plug" for Australia's dynamic telecommunications industry. It contains all the elements of a fully liberalised telecommunications services sector which welcomes new players. This financial year the Australian Communications Authority is conducting four auctions of spectrum bands, which offer opportunities to new market entrants. I would encourage German companies to look seriously at this proposal.

If you are interested in this or any other investment decision in Australia I suggest you contact the Government's national investment agency "Invest Australia" which provides a range of services to companies seeking to invest in Australia, and to Australian companies seeking overseas investors for Australian projects. An Investment Commissioner is located in the Austrade office in Frankfurt. The National Investment Response Centre in Sydney, and Austrade offices here and overseas can also offer assistance.

Updating the existing double taxation agreement between Australia and Germany will further enhance the trade and investment framework. I am advised that there are only a handful of outstanding issues and my hope is that we will be able to sign it before the end of this year.

Conclusion

Both the Australian and German economies have experienced major structural change in the recent period. These changes point the way to developing further the bilateral trade and investment relationship.

It is my hope that the Sydney Olympic Games will provide a catalyst for seizing these opportunities and for further enriching the trade and investment dialogue between Australia and Germany.

Local Date: Tuesday, 22-May-2012 07:12:14 EST