Speech
at the launch of the report Connecting with Asia's Tech Future
Melbourne, 26 November 2002
Emerging Opportunities in East Asia's ICT and E-Commerce Markets
Distinguished guests, ladies and gentlemen.
It gives me great pleasure to welcome you here today to launch the
report Connecting with Asia's Tech Future: ICT Export Opportunities.
I congratulate Dr Frances Perkins and her team in the Economic Analytical
Unit of the Department of Foreign Affairs and Trade for producing
this timely report.
I want to thank Austrade for their generous sponsorship of this report.
And I particularly want to thank BHP Billiton for their valuable
corporate sponsorship of EAU research.
I'm delighted to have this opportunity to talk with you today about
the strengths of the Australian information and communication technology
(ICT) industry and its export potential.
In particular, I'd like to focus on how business and government can
maximise the opportunities available in East Asia's promising ICT
market.
A New Trade Complementarity with East Asia
A new trade complementarity is emerging between Australia and East
Asia in the ICT industry.
Australia's strengths in supplying advanced ICT services and producing
specialised ICT equipment and software closely complement East Asia's
competitiveness in mass produced ICT equipment.
For now, East Asia's demand for ICT services and software is relatively
small and focused on more developed regional economies.
But this is changing as ICT investment and uptake surge throughout
the region.
Australia, for its part, is a rapid adopter of ICT and e-commerce
and has developed a world-class ICT services sector.
Along with microeconomic reforms, Australia's ability to apply ICTs
quickly and effectively throughout the economy has boosted productivity,
growth and living standards.
Australia is now the fastest growing economy in the OECD, outstripping
even the pre-eminent 'new economy', the United States.
Australia's experience shows that a country does not have to be a
major ICT equipment producer to achieve these gains.
Applying ICT broadly throughout the economy is, in many respects,
more important.
Indeed, our ICT industry output and income have grown strongly, and
ICT employment has increased twice as quickly as in the economy overall.
In the ICT services sector, ICT companies account for almost three
quarters of total ICT industry value-added.
So, having developed a world class ICT industry, Australia is well
placed to leverage this experience to apply and adapt ICTs to East
Asia and other international markets.
The figures speak for themselves.
Since the mid-1990s, Australia's ICT services exports to East
Asia have grown a strong 10 per cent per year, while globally they
have grown by 6.5 per cent per year - with a considerable 30 per cent
per year surge in Europe .
Australia's ICT equipment exports to East Asia have grown
at a more modest rate of 6 per cent per year over the 1990s and early
2000s as labour-intensive ICT manufacturing processes moved off-shore.
Nevertheless, exports of some advanced ICT equipment - often products
in which Australia has intellectual property - are doing well.
Australia's ICT Industry Growing Strongly
The healthy growth in Australia ICT exports is underpinned
by a dynamic ICT and e-commerce sector that now accounts for 4.6 per
cent of gross domestic product - more than agriculture, forestry and
fishing.
Since the mid-1990s, ICT production revenue has risen
about 10 per cent per year, with the computer services segment growing
even faster at 14 per cent.
Small, cutting-edge firms, particularly in computer services,
have been particularly dynamic.
Indeed, while many large ICT multinationals have operations
in Australia, small firms now dominate Australia's ICT sector.
The Government is working hard to help this important
and dynamic sector reach its full potential.
A recent example is the Government's Backing Australia's
Ability statement, which provides a comprehensive support package
worth A$2.9 billion over five years to encourage investment in technology
development, including ICT.
Another example is the Government's Business Entry Point
and government on line programs to reduce red tape and support e-commerce.
My own agency, Austrade, offers a range of programs to
assist ICT exporters, as a part of the Government's effort to double
the number of exporters by 2006.
Changes in East Asia's ICT Markets
And of course, this report contributes to the government's
efforts to help Australian ICT firms succeed in East Asian markets,
by analyzing recent trends in regional ICT demand, trade and investment
barriers, regulations and government support.
The East Asian ICT market is indeed undergoing profound change.
East Asia is experiencing some of the fastest growth in ICT expenditure
and take up in the world, boosting demand for ICT equipment, software
and ICT and e-commerce services.
Telephone, PC ownership and Internet access are expanding
rapidly, spurred by falling equipment tariffs, increasing foreign
investment, growing government support and improving regulatory regimes
and legal environments.
The report also analyses in some detail 11 major ICT markets
in the region from Japan to Vietnam.
As would be expected, industrialised East Asian economies
spend much more as a share of GDP on ICTs and ICT services, and undertake
more e-commerce than do developing regional economies.
The advanced services-based economies of Japan and Singapore
purchase over 60 per cent of Australia's ICT service exports to the
region.
Most East Asian governments strongly support ICT production,
and ICT and e-commerce take up.
For example, to improve ICT services, the Republic of
Korea and Singapore have built broadband networks on which they provide
online government services.
And many developing East Asian economies are expanding
ICT training and education programs.
At the same time, many East Asian economies are deregulating
their telecommunications sectors, lowering call and Internet access
charges.
Deregulation creates opportunities for foreign firms such
as Telstra which has established headquarters in Hong Kong and undertaking
business in China, Vietnam and several other regional economies.
However, many East Asian governments recognise the need
to do more to liberalise their telecommunications markets, improve
IT education and strengthen the legal environment to encourage faster
ICT and e-commerce take up.
Electronic transactions security, intellectual property
piracy and electronic data privacy inhibiting e-commerce will also
present particular challenges for many regional economies.
ICT Opportunities in East Asia
East Asia's diversity in income, education, skill levels and regulatory
regimes provides varying commercial opportunities and growth prospects.
The Government and business community need to work closely to capitalise
on emerging opportunities in areas as diverse as e-security, mobile
data services, Internet and value-added services, public sector ICT
solutions and risk management.
Austrade assists ICT businesses access markets in East Asia, through
a network of regional offices and frequent business delegations to
the region.
Austrade's Global ICT Team, a network of ICT specialists, can help
Australian businesses expand into new markets and roll out new products
internationally.
International market access will also be critically important for
the growth of our ICT industries.
The Australian Government is building on significant achievements
like the WTO's Information Technology Agreement to ensure trade barriers
against ICT goods and services continue to fall, creating further
opportunities for Australian ICT exporters.
Conclusions
Ladies and Gentlemen,
I can only highlight a few aspects of this broad-ranging report.
The important message I would like to leave with you today is that
the remarkable complementarity between the Australian and East Asian
ICT sectors will create new, attractive opportunities for Australia'
s dynamic ICT businesses in the near future.
The Australian ICT industry is well placed to succeed in the competitive
East Asian ICT market. Certainly the Australian Government stands
ready to assist in any way it can.
Today's EAU report is an important contribution to Australia's agenda,
and provides a valuable resource for business and government alike.
I reiterate my congratulations to the authors and sponsors. And I
commend the report to you.
Local Date:
Tuesday, 02-Dec-2008 14:22:51 EST
