Read the source article by The International Trade Administration (ITA) here.
With 24 million English-speaking citizens, high household incomes, and a skilled workforce, Australia is a natural trading partner to the US. With 1 in 22 Aussies visiting America each year, there’s a good chance your next potential customers are ready and eager to see what you have to offer.
Let’s look at some of the main reasons why your business might want to start exporting to Australia.
Why export to Australia?
Just like America, Australia has well-established laws and strong IP protections. You’ll also find a familiar legal and corporate framework, with well-developed consumer and industrial sectors. As such, it’s an easy and straightforward place to do business – similar in many ways to Canada.
Strong Free Trade Agreement
Australia and the U.S. have had an FTA in place for over 10 years, and 99% of products entering the country do so free of duty. Not only does that make imported U.S. products cheaper for Austalians, it also means less paperwork for you. The FTA also gives U.S. companies access to government procurement projects – a significant perk not available to non-FTA partners.
As a country, Australia manufacturers very little, so most products are imported from overseas. With a thriving mining industry, Australia is also a big market for U.S. heavy machinery and drilling equipment. There’s a huge market for farming equipment, too.
In 2017, Australia beat the 26-year record set by the Netherlands for achieving the longest period of uninterrupted economic growth. The country’s GDP is expected to grow by 2.3% in 2019, with a further 2.5% increase anticipated for 2020.
Open to foreign investment
Australia is known for its open and welcoming approach to foreign investment, which it sees as a vital factor for continued economic growth and confidence. Its natural and renewable energy resources attract investment from around the world – particularly the U.S., which is already the country’s no.1 source of foreign investment (USD690.6 billion in 2017). Around 1,400 U.S.-owned firms have offices in Australia, covering major sectors such as mining, oil and gas, finance, insurance and manufacturing.
Robust legal and financial systems
Australia is a signatory to every major international dispute resolution convention, and leads the way in the provision of dispute resolution mechanisms. The country also has a AAA international credit rating and its financial market abides to global regulatory practices. Furthermore, its ‘big 4’ banks are ranked highly in terms of both financial security and liquidity.
Access to other markets
The shared language and ease of doing business in Australia means it’s a convenient springboard into countries like New Zealand, Fiji, and Papua New Guinea.
Just one thing to bear in mind
Despite all the positives, there’s one major hurdle you’ll need to overcome when expanding into Australia: the distance. In fact, it’s easy to forget just how far away Australia is, and those high shipping costs could easily render your product uncompetitive in the marketplace. Once your products land, they’ll also be pricey to haul across the country. Believe it or not, it’s more expensive shipping overland from east coast Sydney to west coast Perth than it is from L.A. to Sydney.
For more information and advice, explore the country commercial guides on export.gov, or contact the U.S. Commercial Service.