The Australian government wants to strengthen its partnership with local business chambers. Top officials are encouraging Cebuano exporters to take advantage of free trade agreements (FTA) to boost trade between the two countries.
Australian Ambassador Rod Smith said they have been considering Cebu as one of their potential business partners because of its thriving economy, which is buoyed by the growth of the city’s manufacturing and outsourcing sectors. “Australia and the Philippines have a long-standing trade relationship. We want to strengthen it and we are capitalizing our efforts in Cebu and the rest of the Visayan region,” Smith said in a recent interview.
Smith said Australia’s interest in the country is mainly in mining, business process outsourcing, infrastructure and tourism. Smith said there is “great promise” of an increased trade partnership with Australia and the Philippines with the Asean-Australia-New Zealand Free Trade Agreement (AANZFTA) going into effect last year.
Less than 3 percent
Smith reported that of the $90 billion in trade between Asean and Australia, the Philippines accounts for less than three percent or $2.5 billion. Last year, two-way merchandise trade between Australia and the Philippines was valued at P60 billion. Major Australian merchandise exports to the country include copper ores and concentrate, medicine, copper and milk and cream.
Philippine exports were electrical machinery and parts, radio broadcast receivers, telecommunications equipment and parts. The two-way trade in services between the two countries last year is valued at P35.28 billion, with the Philippines recording a surplus of P18.36 billion to an import of P17.12 billion from Australia. Australia’s top service exports to the country are education-related and personal travel. The Philippines’ top exports were personal and business-related travel.
The AANZFTA is Australia’s largest FTA. It eliminates about 96 percent tariff on the country’s exports to Australia. “The importance of the agreement is that it gives Philippines the competitive position to do trade in our country,” Smith said. He also advised exporters to look beyond traditional markets and consider Australia’s large economy as destination of the country’s exports. For Cebu, Smith said they are interested in the furniture and food processing sectors.
“We don’t only cater to finished products but we also export intermediary services. The challenge for exporters is to make use of the Australian export-driven country, for them to get involved in the supply chain of the global market,” Smith said. “We really hope to bring more Cebu products to Australia.”
Ross Bray, senior trade and investment commissioner for Philippines and Micronesia of the Australian Trade Commission said they have partnered with the Department of Trade and Industry in conducting trade and investment seminars for exporters.
He said that it is important for an investor to know Australian culture. Apart from increasing trade, Australia is also promoting its country as an ideal destination for education. Bray said Philippines is one of the country’s major recipients of scholarship grants. He said studying in Australia would give Filipinos instant connection with other foreign students who could be future business partners. Over 617,000 international students studied in Australia last year. The students came from China, India, Korea, Thailand and Vietnam.
Last year, over 4,800 Filipinos studied in Australia. “Aside from the quality of education, Filipinos study there because of its proximity to the Philippines and both countries have similar time zones,” Bray said.
Source: The Sauce
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