International trade literally makes the world go round. Without it, we wouldn’t be drinking that Colombian coffee every morning, or sprinkling that truffle oil on our eggs. We wouldn’t be using that smart phone designed in California and manufactured in China, and we may not be heading off to that all-important job dealing with customers and suppliers around the world.
In Australia, jobs are best created and protected over the long term through an open and competitive economic system.
Further increasing opportunities for Australian companies to trade and invest around the world is crucial to unlocking our economic potential, and to ensuring jobs for Australians today and tomorrow.
Australia simply cannot afford to go backwards on trade.
For example, small and medium-sized enterprises (SMEs) engaged in global trade are often exposed to greater competition and new concepts, thereby fostering innovation. SMEs that export are three times more likely to introduce new products or services to market than those which are entirely domestically-focused.
In Australia, 96% of businesses are classified as SMEs. They are estimated to account for 43% of private sector employment, contribute roughly 33% to private industry value-add, and account for one-fifth of Australian GDP.
We must therefore ensure these SMEs can grow into larger enterprises by capitalising on opportunity, both on our own shores, and overseas. Trade agreements help ensure they can compete domestically and internationally on even playing field.
In the current international environment, the lack of support for agreements such as the Trans Pacific Partnership (TPP) from the new US administration does not have to mean the end of the agreement. Rather, this can present a new opportunity for Australia and other like-minded nations to take the lead on creating new market openings for our companies, and ensure the jobs and prosperity of tomorrow are as secure as possible.
Australia must therefore continue to pursue new liberalising trade deals, as well as other international agreements that prioritise the interests of prosperity-creating SMEs.
On behalf of all SMEs, the ECA stands behind the Australian government’s focus to pursue an alternate agreement under the TPP framework. This could create new opportunities for Australian exporters in TPP markets like Canada, Mexico and Peru, with whom we currently lack bilateral trade agreements. It can also update and enhance existing opportunity in TPP markets where have existing agreements in place.
We stand behind Australia’s active participation in seeing the Regional Comprehensive Economic Partnership (RCEP) through to conclusion. This could help drive new opportunities for Australian companies in our own neighbourhood.
We also stand behind the pursuance of additional FTAs with partners in the Indo-Pacific region that sit further afield, such as the European Union and Pacific Islands.
Finally, in the wake of Brexit, the ECA stands behind Australia’s efforts to forge stronger economic ties with the United Kingdom, including through a new bilateral trade agreement.
It is imperative that Australia continues to seek to avenues to ensure our collective economic future. No less than the prosperity of Australian companies and Australians themselves is at stake.
*Lisa McAuley, CEO – Export Council of Australia