ASEAN. DRIVING YOUR AMBITION.

ASEAN Connected

A new report by HSBC Australia and the Export Council of Australia, ASEAN Connected, highlights the specific opportunities that Australian companies can leverage and also examines the trends which will determine the future of the region.
  • Click here to download a copy of ASEAN Connected

New opportunities for Australian businesses

Australia’s trade with ASEAN is growing, but the pace of that growth does not necessarily reflect the potential presented by ASEAN economies.

Overall, Australia-ASEAN trade grew by around $12 billion between 2011 and 2014. This was less than half of the $30 million growth in Australia’s two-way trade with China during the same period.

There are clear ways for Australia to deepen ASEAN trade, either by taking advantage of low hanging fruit or through other transactions that could deliver significant benefits to our business sector.

Some of the opportunities stem from satisfying new or existing demand, and some lies in leveraging ASEAN’s existing strengths to facilitate increased trade not only between Australia and the region, but with the wider-world as well.

The new report highlights ways that Australia can capitalise on its strengths in areas such as education and advanced manufacturing. It also shows how companies can improve efficiencies by utilising ASEAN’s own strengths in business process manufacturing or operating regional treasury centres, for example.

 

The report focuses on the most mature, or fastest maturing, ASEAN markets for Australian goods and services, as well as the most developed operating environments in the region.

Singapore offers an easy, low-risk ASEAN entry point for Australian companies, and is an ideal location in which to establish a regional treasury centre as part of a pan-ASEAN proposition.

Malaysia represents an opportunity to match Australia’s highly-regarded education and advanced manufacturing expertise with the country’s need to further up-skill its workforce as the Malaysian manufacturing sector climbs the value chain in a more connected ASEAN.

The Philippines offers Australian companies possible cost-savings and efficiency gains by integrating its strengths as a business process management hub into their own value chains.

The extensive need for infrastructure in Indonesia presents a market for Australian companies in development and supporting services, but with this comes a complex set of challenges to capitalising on this Australia’s closest ASEAN neighbour.

Thailand provides a strategic gateway to the Cambodia-Myanmar-Laos-Vietnam subregion, allowing Australian companies to leverage a more established and comfortable operating base to access ASEAN’s fastest-growing markets.

Finally, in Vietnam - Australia’s fastest-growing ASEAN trading partner - Australian education service providers can tap a fast-growing market, hungry for knowledge and expertise.

ASEAN’s competitive landscape is tightening, however. The region’s high economic growth and maturing economies are attracting more and more of the world’s best and brightest, while local firms are improving their own capacities, moving up value chains and becoming formidable competitors in their own right.

It is therefore crucial for Australia’s future prosperity that we reinforce and grow our competitive position in ASEAN, especially as the region becomes more interconnected and opens new opportunities for foreign businesses to capitalise on its dynamic growth.

Individual ASEAN members are already among our largest trading partners - led by Singapore, Malaysia and Thailand – and Australian companies have enjoyed many successes and are welcomed across the region.

The proximity, experience and soft ties Australia enjoys with ASEAN cannot easily be matched by our competitors from Europe or North America.

The ASEAN-Australia story is therefore a very positive one, and will continue to be, providing Australian companies are proactive in their outlook and quick to capitalise on emerging opportunity.

This report is not intended as a comprehensive study of the ASEAN opportunity for Australia, Instead, it instead aims to inform and spark discussion on the fundamentals of Australia’s trading links with the region, as well as the impact various trade and connectivity initiatives will have on opportunities.

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