New trade agreements between the European Union (EU), the UK, Latin America, and the Pacific are set to benefit exporters.
According to the Managing Director of Oceania at Atradius, with the trade war between the US and China business are more likely to start targeting new markets.
“Instability in the US market, evidenced by its trade war with China among other signs, creates a risky environment for exporters looking to focus on those top two markets,” commented Mark Hoppe.
“Therefore, businesses should diversify to make their operations less vulnerable to these external factors.”
“As well as targeting the US and China, there are plenty of opportunities on the horizon for Australian exporters to target countries such as Japan, Mexico, Canada, and Singapore through the TPP, as well as opportunities in Europe, Latin America, and South East Asia. Smart exporters should move quickly to take advantage of these emerging opportunities.”
According to the Export Council of Australia, 20% of local firms are targeting the US, with China receiving 19% interest, followed by the UK Indonesia and Vietnam at 18%, 15%, and 14% respectively.
“Free trade deals are crucial for Australian exporters looking for favourable terms to expand into new markets.”
“For example, the TPP trade deal is worth an estimated AU$15.6 billion in net annual benefits to the national economy by 2030.”
“The key sectors set to benefit are steel, wine, and agriculture. With Australian farmers facing tough conditions at home, the ability to sell into new markets will be welcome.”
From the top 20 markets identified by firms for expansion, Australia had either begun to and or had plans to negotiate trade agreements with 18 nations.
“To make the most of these emerging opportunities, Australian exporters must ensure their online sales channels are well set-up and offer frictionless buying for customers regardless of where they are in the world,” Hoppe continued.
“They should also invest in trade credit insurance to assess the market, sector and potential buyer and protect them against potential late or non-payment by customers in these markets.”