As 2011 draws to close, it is interesting to reflect on how the year shaped up for Australian Exporters.
Even though our balance of trade is looking positive, it has been the resources sector making the running on export growth.
With the high AUD and events such as the devastation in Japan, cyclones in Queensland and floods in Victoria, new problems emerging in Europe, and the US still trying to rebuild from the GFC, it has not been a great year for many exporters.
Thank heavens for Asia! The continuing growth to our north has kept many exporters in business and has had to make up for lower demand in established markets.
And for 2012? Well the signals are that the problems in Europe will persist and the USA is still some time away from recovery.
So again Asia and sectors in South America, plus new markets in Africa will form the vanguard for our 2012 opportunities. Perhaps a FTA with South Korea would be a great way to start the New Year, along with progress on the Trans Pacific Partnership.
It is difficult to predict what might happen with the AUD, but it will require strategies for exporters, so as to avoid rate volatility playing havoc with export pricing.
With the Government focused on returning to surplus, there won’t be much in the way of financial support for exporters outside the EMDG scheme.
Mining and Agriculture should be strong sectors for 2012, and for others it will be finding a niche and working hard at it. Australian Exporters have proven they are strong adapters, and they have a capacity to find opportunities in the most unlikely places. The big risk seems to be contagion from Europe impacting the domestic economy.
So with things potentially a bit slow domestically next year, export can still be the road to growth. It will require though a realistic assessment of the risk/reward of certain markets to ensure a positive return. As the (purported) old Chinese saying goes, “may you live in interesting times” and 2012 is certainly shaping up as interesting.
Peter MaceGeneral Manager
Australian Institute of Export
