Trade and investment, tourism and private sector engagement

Overview

The department led the Government’s economic diplomacy strategy and continued work to enhance global conditions for trade liberalisation, promote productive investment flows and support the interests of Australian business.

The department supported the Trade and Investment Minister’s engagement with Australian business, including through the Trade and Investment Policy Advisory Council and multiple interactions with individual businesses and peak bodies. The department maintained effective and regular contacts with the business sector to inform the development of policies and programs to advance Australian trade and investment interests.

The department worked closely with the Export Finance and Insurance Corporation (Efic) in its new role supporting eligible small and medium enterprises (SMEs) access financial products that will enable them to grow internationally.

Following reforms to the Foreign Investment Framework late in 2015, we worked closely with Treasury and Austrade to promote Australia as a destination for productive foreign investment and enhance the country’s international reputation.

The department coordinated the Government’s engagement across APEC’s broad economic and development agenda. We shaped key leader-level initiatives on services liberalisation and structural reform. We organised workshops to help build the capacity of developing economy policymakers on trade facilitation and to support APEC trade promotion agencies to connect women-led SMEs to export markets.

The department continued to support implementation of major outcomes from Australia’s 2014 G20 Presidency, including the Brisbane Action Plan. Officers posted to Ankara and Beijing worked with host governments in support of Australia’s whole-of-government G20 priorities.

In 2015, the department used Australia’s role in the G20 troika (of past, present and future G20 hosts) to collaborate with Turkey. We lent our support to the initiative to establish the Women 20 engagement group as a way to champion inclusive economic growth and raise the profile of gender equality issues across the G20 membership and work program. We worked closely with China during its 2016 presidency to elevate trade and investment on the G20 agenda and supported China’s initiative to establish a dedicated working group on these topics.

We continued to engage with the OECD agenda and promote its work in a number of areas consistent with Australia’s interests, notably on trade reform and structural barriers to growth. We supported the OECD’s policy analysis contribution as an evidence base for major international agreements on sustainable development, climate change and trade. The department played an active role in OECD negotiations on export credit arrangements to support the uptake of high efficiency low emissions coal-fired power plants and improve energy access in the region.

The department began Australia’s term as 2015–16 Chair of MIKTA, securing agreement to our priorities of international security and energy governance, sustainable development and gender equality.

We engaged with governments and other partners in major tourism markets to identify issues standing in the way of further growth. We updated the Australia–China MOU on tourism cooperation to streamline visa processing and facilitate more independent visitors travelling between the two countries.

The department managed Australia’s financial support for international energy and resource sector development initiatives, including in natural resources governance and clean energy. We contributed to a whole-of-government strategy to comply with the International Energy Agency’s oil stockholding obligation and showcased Australian capacity at the 18th International Conference and Exhibition on Liquefied Natural Gas.

The department managed Australia’s $32 million investment (2012–16) in the Private Infrastructure Development Group, a company with donor shareholders that has helped attract considerable private sector capital and international development finance to infrastructure projects in developing countries and emerging markets—US$1.9 billion in 2015 alone.

Since August 2015, private sector engagement has been a cornerstone of Australia’s aid program. The Business Partnerships Platform, launched in November 2015, created a dedicated platform for accelerated collaboration between business, government and civil society. We developed a range of new strategic partnerships, including with Global Compact Network Australia, Shared Value Project and Fairtrade, to drive faster and more inclusive private sector-led growth in the region.

The first round of the Business Partnerships Platform saw $3.8 million of departmental funding attract $10.2 million in additional private finance for initiatives seeking to generate social and commercial returns in partner countries. The strong response underscores the benefit of partnering with the private sector to achieve development outcomes. The second round will open in 2016–17.

Results

Promoting a stable and prosperous regional and global environment by cultivating and deepening our engagement with bilateral and regional partners and multilateral institutions

MIKTA – A new approach to international cooperation

Case Study
mikta-2-replacement_cmyk_300dpi
First Assistant Secretary, Trade, Investment and Economic Diplomacy Division, Brendan Berne (centre), with Chief of Staff to Deputy Minister of Foreign Affairs, Mexico, Héctor Ortega (left); Deputy Undersecretary for Economic Affairs, Ministry of Foreign Affairs Turkey, Ayşe Sinirlioğlu (2nd left); Deputy Minister for Multilateral Affairs, Ministry of Foreign Affairs Indonesia, Hasan Kleib (2nd right); and Director-General, Policy Planning Bureau Ministry of Foreign Affairs, Republic of Korea, Dr Shin Beomchul (right), MIKTA Senior Officials’ Meeting, Canberra, 27–29 January 2016. [DFAT/Ben Lavis]

MIKTA – A new approach to international cooperation

In September 2013, the foreign ministers of Mexico, Indonesia, Republic of Korea, Turkey and Australia met in New York to collaborate on the international policy agenda.

Referred to as MIKTA, the new grouping was a response to rapidly-changing global dynamics—the rise of regionalism, emergence of new sources of economic growth, the difficulties confronting many global governance structures and new protectionist impulses.

In leading Australia’s contribution as chair of MIKTA for 2015–16, the department hosted the Senior Officials’ Meeting in January 2016 and has delivered an agenda that deepened the MIKTA partnership across priority issues. These issues range from counter-terrorism to trade, e-commerce, humanitarian assistance and sustainable development.

The growth in MIKTA’s agenda reflects its appeal for creative policy makers looking for new approaches to today’s complex global challenges. MIKTA shows that existing multilateral divides can be bridged with open discussion and a spirit of collaboration. In doing so, it serves as a model for a new style of effective multilateral diplomacy.

In developing the MIKTA agenda, the department collaborated with the Coral Bell School of Asia Pacific Affairs at the Australian National University to deliver an academic conference, appoint a visiting fellow and create an intern position. This academic channel is generating fresh insights and initiatives for MIKTA multilateral collaboration.

Improving market access for Australian goods and services, attracting foreign investment to Australia and supporting Australian business abroad

FTA Outreach

Case Study
Trade and Investment Minister Steven Ciobo with DFAT officers at the launch of the Free Trade Agreement portal. [DFAT]
Free Trade Agreement Division officers, Adam Coin and Emily Sandilands, with Minister for Trade and Investment Steven Ciobo (right), launch of the FTA Portal, Sydney, 23 March 2016. [DFAT]

FTA Outreach

Australia’s free trade agreements—particularly those with China, Japan and Korea—are not ‘set and forget’ documents requiring no further work after entry into force. Treaty provisions must be translated into commercial outcomes. In 2015–16, the department played a central role in communicating the benefits and explaining to business how to take advantage of the FTAs.

We delivered the FTA Portal (www.ftaportal.dfat.gov.au), a website which provides a state-of-the-art tariff finder and rules of origin guide for the North Asia FTAs, especially helpful for goods traders. The portal also promotes innovation by making the underlying data available to third parties, such as business groups.

Since first release in October 2015, the FTA Portal has provided access for over 15,000 unique users to a sophisticated tariff finder and rules of origin guide covering Australia’s three North Asia FTAs. The FTA Portal won Best Applications Development at the 2016 Australian Government ICT Awards. In response to user feedback, we will expand the portal to include each of Australia’s other existing FTAs in 2016–17.

Building on user feedback, and as a way to further inform business decisions, we will expand the portal over the next four years to include data on other FTAs and a facility to compare outcomes across agreements. The department will continue to build on the success of this close collaboration between our FTA policy and technical areas. We will continue to leverage the department’s other digital platforms to broaden our outreach to stakeholders and the Australian community.

Together with Austrade, we delivered FTA information seminars around Australia. Experts from the department, Austrade, Efic, AusIndustry and TradeStart provided information to business on FTA benefits, use of the agreements and government assistance available.

The department helped deliver 47 North Asia FTA information seminars around Australia for existing and prospective exporters, with a focus on small business. Almost 2,000 business representatives attended with 99 per cent of post-event survey respondents saying they achieved some, most or all of their objectives from the seminars.

Attendees welcomed the advice from successful exporters. One Adelaide attendee wrote: ‘As I sat in this morning’s seminar, many opportunities for our organisation came to light. The seminar helped our feeling of confidence in pursuing them too.’ Given the success of the seminars, we will continue the FTA information program over the next year as part of our overall outreach efforts.

Business satisfaction with the department’s support

Through its economic diplomacy strategy, the department has increased its focus on supporting Australian business to improve trade and investment outcomes. As a result, we have observed an uptake of, and satisfaction with, our key business-related services—in particular, our work to support Australian business better understand and take advantage of the significant opportunities arising from the FTAs with China, Korea and Japan.

We have broadened the way we provide Australian business with geo-political insights, policy information and trade and investment data through the Business Envoy publication and better use of social media. Business has responded positively to this.

Business Envoy and Trade Talk publications share analysis and reporting on key trade and investment developments from Australia’s global diplomatic network. Together, the publications reached more than 2,600 direct subscribers, with uptake growing steadily over the 2015–16 period.

Through the Business@dfat portal, the department responded to more than 500 enquiries from business about the department’s services. Demand for our statistical consulting services and publications has grown by over 40 per cent since 2014–15, with the department now providing additional time series data free of charge.

We managed strong demand for the department’s FTA hotline (02 6261 1888), with over 800 enquiries and over 114,000 individual views on our China FTA site alone.

Delivering an innovative aid program, centred on the
Indo–Pacific region, which contributes to sustainable economic growth, poverty reduction and regional stability

partnering with Fairtrade Australia New Zealand to boost trade and grow prosperous communities in the Asia–Pacific

Case Study
Female member of the Vanilla Growers Association in Tonga with cured vanilla pods for export. [FAIRTRADE ANZ/Rachel Levine]
Pasepa Lolohea with cured vanilla pods for export from the Vanilla Growers Association in Vava’u, Tonga. [FAIRTRADE ANZ/Rachel Levine]

partnering with Fairtrade Australia New Zealand to boost trade and grow prosperous communities in the Asia–Pacific

In 2015–16, the department formed a partnership with Fairtrade Australia New Zealand to help boost Australian business use of and value add to Fairtrade products in domestic and Asia–Pacific export markets. The partnership has created sustainable commercial relationships between producers and markets, reducing the reliance on aid funding in the longer term and advancing Australia’s economic and social development objectives in the region.

Fairtrade is about providing predictable and fair prices, decent working conditions and improved terms of trade for farmers and communities. It works right through the supply chain to the place where consumers buy the end product.

Joining forces with Fairtrade has provided links to retailers and supply chains, consistent with the department’s goal to create scalable partnerships with the private sector. The partnership has delivered a revitalised commercial strategy, which has enabled Fairtrade to expand its business partnerships with traders and manufacturers, and raise consumer awareness of Fairtrade products. The department has gained access to Fairtrade’s 25 years of experience and insights into transparent and sustainable pro-development trade, and Fairtrade is benefitting from our expertise, networks and country knowledge.

Although the partnership is only in its first year, we have seen rapid growth in trade volumes and retail sales in Australia. Pacific producers earned $21 million in Fairtrade revenue, retail sales of Fairtrade products in Australia increased from $166 million in 2013 to $223 million, and per capita spend on Fairtrade increased from $10.90 to $15.75. The department tapped into unrealised market potential and in doing so has delivered a better deal for small producers across the region.

Analysis and outlook

The department’s expert analysis of major developments in the international economy meant we were able to make a strong contribution to the Government’s domestic economic reform agenda. We improved our policy advice on Australia’s foreign investment regime and engaged more actively in the economic debate, including significant contributions to the Joint Economic Forecasting Group and the Government’s tax agenda.

We worked collaboratively with other agencies to build awareness across government of Australia’s international trade and investment interests. We were actively involved in policy reforms affecting Australia’s business interests, such as visa reform. We will continue to contribute to the Government’s economic reform agenda through high-quality analysis of best practice and lessons learned, drawing even more on our diplomatic network and membership of global bodies such as the OECD and APEC.

Effective engagement in regional and multilateral economic forums such as APEC, G20, MIKTA and the OECD will continue to be important to deliver economic, social and institutional outcomes in Australia’s interests. The Collective Study on a Free Trade Area of the Asia Pacific and the Services Competitiveness Roadmap are priorities. We will work closely with Germany through its G20 Presidency.

Australia will chair the Kimberley Process Certification Scheme for trading rough diamonds in 2017 and will focus on strengthening scheme implementation. We will use the 2017 Australia–China Year of Tourism to increase awareness of Australia as a holiday destination and build linkages between our respective tourism sectors.

We will work with the Department of Industry, Innovation and Science to set up an effective implementation system for EITI in Australia, drawing on the experiences of other countries.

We will enable, invest in and develop innovative initiatives that attract private capital to emerging markets in our region, including by leveraging private investment in infrastructure in developing countries.

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