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What China’s Rebalancing Means for the future of Australia’s finance sector

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The Australia China Business Council (ACBC) and ShineWing Australia recently released the industry leading 2016 Australia China Trade Report – The Long Boom: What China’s Rebalancing Means for Australia’s Future.

The report, produced in conjunction with Monash Business School and the Australian Centre for Financial Services, serves to highlight some of the opportunities that may flow to Australia as a result of “China’s Rebalancing” from an infrastructure investment-led, to a consumer demand-driven economy.

Australia’s Finance and Insurance sector

China presents an enormous opportunity to expand it’s current output, share of the economy and jobs. As a major employer of Australian workers and the largest single contributor to corporate tax receipts, expanding this sector through greater trade and investment with China will have a major flow-on impact for the wider economy.

Some of the  key messages for the finance sector include:

  • Financial services is Australia’s single largest industry contributing more gross value to the Australian economy than the mining sector
  • China could represent up to 19% of Australia’s financial services export market by 2026
  • China’s share of the financial services export pie is projected to grow from 11% to 16% in 2026, which will result  in the growth of more than 110,000 jobs.

“Like healthcare and education, financial services will be a key driver of Australian economic growth over the next decade”.

Continued Opportunities for Growth

Modelling by the Australian Centre for Financial Studies rebuts the view that China’s softening growth will have a predominantly negative impact on Australian trade. In particular:

  • China’s demand for Australian exports will grow as it modernises its economy and the middle class grows by an estimated 109 million adults
  • China will claim just over 31% of Australia’s exports by 2025, up from 28% at present
  • Close to one million new jobs could be created across the five key industries of financial and insurance services, healthcare and social assistance, education, tourism and construction by 2026.
Conclusion

The future of the Australia-China trade relationship is one of both opportunity and challenge. Key opportunities lie in industries other than mining that align with China’s likely growth profile. The rising Chinese middle class presents an opportunity to broaden and deepen the Australia-China bilateral economic relationship in the generations to come with services already accounting for around 75% of Australia’s economic output and some 85% of employment.

Even with a relatively conservative forecast for Chinese economic growth, China appears set to remain Australia’s dominant trading partner. However, the ability to capitalise on Chinese demand will be contingent on policy decisions, such as visa and investment policy, foreign investment screening thresholds, export finance and insurance.

Tim Hogan-Doran, ShineWing Australia
Tim Hogan-Doran, ShineWing Australia

For more information on the report and it’s implications for Australian businesses, contact community member Tim Hogan-Doran from ShineWing Australia or download the full report here.

Alibaba has just opened an office in Australia – good news for SMEs

alipay_scanThe Australia Week in China (AWIC) delegates that visited Alibaba’s head office in Hangzhou in April 2016 saw the announcement of an office being set up in Australia.  Global President Michael Evans and the local team including James Hudson, previous NSW CEO for Australia China Business Council, have just completed a roadshow.

Continue reading Alibaba has just opened an office in Australia – good news for SMEs

Migration Conference held in Sydney – speaker insights

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Jennifer Fong, VisaCorp, Stacey Martin, NAB SIV Advisor, Chris Livingston and Liana Allan, Migration Alliance
The 2016 Migration Conference organised by Legal Training Australia and Migration Alliance had over 130 attendees with a packed full day program.

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Suzanne Gillham provided an overview of the current focus for the NSW government in attracting business and skilled migration to NSW. So far, they have nominated 40 applicants under the new SIV2 framework. Continue reading Migration Conference held in Sydney – speaker insights

A total of 1,228 visas have been granted so far under SIV 1 and 2

Australian visa

The Significant Investor Visa program saw a rush of applications last year prior to the change in complying investment requirements which came into effect on 1 July 2015. 

Figures recently released to 31 January 2016 show 340 SIV1 visas have been granted from the backlog, and 6 under the new SIV2 rules. Continue reading A total of 1,228 visas have been granted so far under SIV 1 and 2