It is acknowledged that mining is a relatively capital intensive activity that uses large numbers of skilled labour during the construction phase, but far fewer during the subsequent mining phase. This has been highlighted in recent weeks by the announcements by some of the large mining companies of their increased use of trucks that are operated remotely without the need for drivers. What happens to all the skilled labour force once the construction phase is over? This might be 10 years or more away but when it happens, what work will be available for these people?

The sectors of the economy that employ most staff such as tourism, education and manufacturing, are the industries suffering the most from the impact of the mining boom, with the Australian dollar in particular creating great difficulty. The situation in their export markets is exacerbated by the weaknesses in European and USA economies. There appears to be a substantial disincentive for Australian businesses, particularly small to medium companies in the service and manufacturing sectors, to look at exporting with the strong Australian dollar, weaknesses in many overseas markets and minimal support from government. The concern is that if these businesses are not looking to become exporters where will employment opportunities be developed?

The concern I have that SMEs are not focusing on exporting is exemplified by the dramatic drop in the number of applicants for Export Market Development Grants (EMDG). The EMDG program, which is the government’s main financial assistance program for SMEs looking to develop export markets, is currently looking at the number of applicants dropping by at least a third over the previous year. While this drop can be attributable to a number of factors relating to the funding of the program (the program was severely underfunded in the past two years and there is no certainty of receiving full payment) and some changes to eligibility, the drop in applications is a sign that SMEs have not been looking at export as a potential market opportunity. The fact that EMDG applications are a lag indicator (as applications are for expenses incurred in the year ended 30 June 2011), is a greater concern as to what might be happening currently.

The possible loss of SMEs to exporting is a blow to Australia’s long term export performance and employment levels. While many SMEs may not succeed in exporting their goods and services, most will. Of those that do succeed there will be a number that will extremely successful – a look through the finalists at the 49^th Australian Export Awards will show more than three quarters were SMEs that accessed Export Market Development Grants in their start up phase.

SMEs need encouragement to enter export markets. This does not necessarily mean greater financial support, although a program such as EMDG should provide certainty to exporters and a real incentive to develop new markets.  However, it does mean focused support from government with an understanding that the high dollar is a barrier to new exporters and that it takes time to develop export markets. The support of Austrade is crucial and it is important that Austrade’s new role does not focus too much on emerging markets or investment but looks to ensure SMEs become successful exporters.

“The new research ranks Australia 8^th and reveals increasingly positive perceptions of Australia’s exports and investment environment from key markets such as South Korea,” said Theresa Fairman, Austrade’s Group Manager Brand Australia. “The Index also confirms that Australia’s greatest strength in the eyes of the rest of the world is our people, who are seen as hardworking friendly and welcoming.”

Demonstrating the Government’s move towards digital technology, the monthly magazine will be free. “By embracing tablet technology we are able to include multimedia elements to help bring the story of contemporary Australia to life,” Fairman said.

The app will highlight the more creative and intellectual strengths of Australians at home and abroad, with the first edition featuring astrophysicist Professor Bryan Ganesler, young social entrepreneurs and Australians performing in the world’s best orchestras.

Supported by australianunlimited.com, the app will be launched in January 2012 and aims to encourage expat Australians to share their stories. The iPad magazine can be downloaded from iTunes.

Story suggestions are invited from readers, and should be submitted to brandaustralia@austrade.gov.au

“The decision follows improvements in business conditions and increasing levels of foreign direct investment in response to the Colombian Government’s economic reform agenda,” Trade Minister Craig Emerson explained.

The decision is in line with the restructure of Austrade which will see more government resources deployed in emerging markets.

Australian activity in Colombia has been growing steadily, led by companies in the resources, engineering and education sectors, Emerson said. “Colombia’s large domestic market and expanding economic integration in the region means it also offers opportunities for Australian enterprises beyond these existing industries, including in infrastructure and professional services,” he added.

The new office will expand the capacity of Australian trade officials to offer advice on trading in the growth markets of Latin America. For several years, a locally-employed business adviser has represented Austrade. The new office and consulate-general represents a far-reaching expansion of the agency’s trade, investment and education promotion activities in Colombia and Latin America.

Recent research conducted by the Institute shows just how difficult things are. More than 80 percent of respondents said the Australian Dollar is having a negative impact on their export sales. More then 40 percent said international sales had been affected by 10-to-30 percent. Their primary concern though is the impact the dollar is having on margins.

The research goes on to forecast an impact on jobs and the concern exporters have of further cost increases resulting from a price on carbon.

Most employers are taking a wait and see approach on jobs, since uncertainly appears to be the key factor. Most expect jobs to be lost though. The study was conducted prior to the Government’s carbon tax announcement but in saying that, feedback since would indicate that little has changed. Exporters remain very hesitant on the issue, most expecting costs to increase and margins to go even lower.

This research is further supported by feedback from the EMDG consultants who clearly forecast a reduction in the number and value of claims this year. This has been brought about by the obvious reduction in export sales and the lack of confidence in both business prospects and the recent failure of the scheme to meet recipients’ expectations. While the 2010/11 EMDG payments are predicted to be better than the $27,500 first tranche and 56.7 percent second tranche payout in 2009/10, decisions on marketing and business development sadly are made long before this data is available hence confidence is low. The question is how do we remedy this?

In my March column I asked if we were were a tad too comfortable. My view is that we were; things in the land of Oz are, I suggest, not quite as sound as we think. Sales were starting to slip and many exporters were really starting to feel the effects. This has resulted in a massive attitudinal change to business prospects, which sadly has manifested itself into a quite devastating lack of confidence.

In my book, and the economists would probably disagree, the first thing we all need to do is kill the notion and rhetoric that constantly says “resources and resources alone will drive our export earnings into the future”. One reason Australia was able to escape the worst of the GFC was the diversity of its export industries including agriculture, manufacturing, tourism and services, including education, which contributes to over 70 percent of our employment.

Secondly, we should take an all of Government approach to trade. Germany, the United Kingdom and more recently the United States are embracing a range of Government departments to drive their export activities and from what we can see, it’s working. Thirdly, we need to build back confidence in the EMDG scheme by making sure it’s fully funded and actively promoted.

It was encouraging to hear the Minister for Trade comment positively about the effectiveness of EMDG at the recent forum on the China Trade Mission and suggest that some additional funding may be made forthcoming. This comes on the back of the 30 June announcement by the Minister to set the first tranche EMDG payment at $50,000 for 2010/11 claims – much better than the $27,500 for the prior year.

The initiative of the Government to take a trade mission to China led by both the Minister for Foreign Affairs and the Minister for Trade focused on services is a good start. Let’s see the Government talking up the export business for a change, getting involved in more high level missions, building confidence through innovative funding initiatives, increasing investment in our export agencies and starting to embrace industry and allied departments to attack the opportunities as a highly motivated, well briefed team of professionals.

To make this really work there will need to be considerable cooperation between state government agencies as well as the many organisations that provide services to the Australian export community. The money that goes into trade promotion is far too limited to allow for massive levels of duplication and what essentially becomes waste. Austrade has set its direction. It’s clear and unambiguous so it is now up to state governments to reassess their programs so that they complement the federal agency and not compete. Austrade too must embrace the capabilities of the key associations and be prepared to outsource programs to those bodies that possess the capability to deliver them professionally and cost-efficiently.

What I’m saying here has been said many times before, but I really don’t think there has ever been a more important time than now for absolute cooperation and sharing resources to drive our export promotion. The remnants of the Global Financial Crisis and the astronomically high dollar are affecting many businesses, almost to the point where existence is on the line. Clearly working together as “Team Australia” and tackling the challenges collectively makes a whole lot of sense.

So where does it start? Clearly, it begins at the top of Government. Government needs to take the initiative, it needs to embrace industry and listen to the people who are out there at the coalface of export. The Federal Government needs to work with the State Governments to implement programs that will add value to Australia’s export performance and not create even greater waste.

While nothing in this world is perfect, in the United States the Obama Government’s approach may be a good model to look at. Why not form an effective council of business people to advise government of trade policy and promotion? Why not foster cooperation between state governments and federal government departments that have trade on their agenda? Why not encourage the development of powerful industry groups to work together to build their export business and why not take high powered trade missions led by the Minister for Trade to the markets identified by Austrade as having great potential? And finally why not put some real dollars behind “Australia Unlimited”, the umbrella branding that cost us so much to develop?

Today’s export environment is tougher than it’s been for a long time. The March quarter Gross Domestic Product picture was not entirely unexpected; exports of manufactured products, many of our services and a good number of agribusiness categories have been suffering for some time, not to mention inbound tourism and education. Is it not time to pull together, work more cohesively and drive Australia’s export activity?  Austrade has taken the lead and taken some wise decisions. Now is the time to finish the job and create an atmosphere that encourages business and governments to go out there as a team and take on the world.

You may wish to follow us on Twitter using the handle @aussieexport

“Exporting is a tough business, for everyone,” Elliot said. “The reality is businesswomen often face tougher challenges because of balancing family commitments with the demands of the commercial world.”

She expressed concern that while the Australian economy is becoming increasingly internationalised, the number of female SME exporters is actually falling. Eleven percent of exporting businesses were run by women in 2007.

Elliot said part of the mandate of Women in Global Business is to encourage women to expand successful business operations overseas by identifying the barriers women currently face in this area. So far, the program has found women are more risk averse than men, are deterred by foreign culture and laws and face tougher work/life balance choices.

Women in Global Business is a cooperative initiative between state and territory trade organisations and Austrade. “The program brings together successful women in exporting—and also from the corporate world—with women who are just starting out in exporting,” Elliot explained. “Successful, experienced people can inspire others to do bigger and better things.”

Elliot said lifting the participation rate of women in business in global trade was a priority for the Gillard Government.

“More of Austrade’s work will be undertaken in the world’s frontier and emerging markets, where Australian businesses can benefit most from government support,” he explained.

Austrade will seek to establish offices in Mongolia and Central Asia and strengthen its presence in emerging markets where the costs of setting up business can be prohibitive. These include Latin America, China and Africa.

“Until now, Austrade has had no permanent presence in a number of frontier markets, but that’s about to change,” Emerson said. “This is where the big growth potential lies for Australian businesses and Austrade will be there to lend assistance.”

Following a comprehensive review undertaken last year by CEO Peter Grey, the reforms will increase Austrade’s focus on frontier markets while reducing resources in developed markets. Some Austrade offices in Europe and North America will close, with the rest of a rationalised work force dedicated to attracting foreign direct investment.

Emerson says the reforms will mean Austrade’s resources are better targeted to markets where its expertise can add the greatest value.

Austrade’s chief economist Tim Harcourt tackles the thorny question of just who makes up Generation Export.

Ian Murray, executive director of AIEx says Australia’s exports are under attack – and we need to fight back.

How do you avoid problems with payments? Adeline Teoh talks to Coface, Travelex and NCI for their tips on keeping cash flowing and managing debtors.

Profile: Australian Export Hero Richard Rains (of Sanger Australia) talks beef, food security and selling meat to McDonald’s.

NSW Industry & Investment’s Kylie Hargreaves explains how marketing overseas differs from your domestic strategies, and Sarah Schmitt explains why IP is important to protect Australian innovation.

Case Study: RivusTV has built a technology to revolutionise video streaming all over the world. We ask them how they’re accessing international communities to build market share.

The conference will run in conjunction with the 23^rd Sanctuary Cove International Boat Show and has attracted registrations from countries all over the world, including the Middle East, China, Taiwan, the United States and New Zealand.

The Australian marine industry is a growth area, attracting new markets in Chna, Korea, Dubai, the US and Europe. Between 2008-09 marine exports were worth more than $459 million, with $6.4 billion gross value of production, and are estimated to generate domestic employment of up to 29,000.

The conference aims to bring together industry stakeholders, boat builders, service providers and marine industry manufacturers as well as promoting Australia as a cruising and refit destination, and providing a venue for overseas companies interested in investment and partnership opportunities to meet local business representatives.

According to Superyacht Australia and Australian Marine Industry Export Group (AIMEX) CEO MaryAnne Edwards, “[Peter Grey’s] considerable knowledge of global markets will provide a valuable contibution to the conference program and be a drawcard for many delegates.”