The landmark announcements of the Australia-China FTA, the Sydney RMB hub and a basket of associated goodies signifies the start of a new golden age of partnership between our companies and professional services firms.
This was the most comprehensive FTA that China has signed with any country to date and reinforces, both economically and psychologically, the strength of the trade and investment relationship between our two countries.
After reading the summary FTA materials, I reflected about the market reform objectives of the Chinese leadership, and recognised the complementary and vital role that Australia’s professional services industry will play to help China’s economic reform.
Key reforms are planned for financial services, agriculture, the environment, state owned enterprises and education by 2020 – these are comprehensive, profound and simultaneous projects which will require assistance from leading international professional services firms, but must be suitable for the local Chinese market and delivered by Chinese professionals.
In this new golden age, professional services firms will help the Chinese government achieve their goals, help Chinese companies internationalise, train large numbers of Chinese professionals, work very closely with Chinese services firms on major projects and in doing so, encourage the growth of China’s domestic professional services industry.
Many of Australia’s leading professional services firms have been established in China and Hong Kong for the past 2-3 decades. Australian firms have invested in joint ventures, in doing so learning how to operate and succeed in China.
They have been helping and advising international companies to invest and operate successfully in China, helping Chinese companies to list on stock exchanges and now helping them to invest and operate successfully in Australia. We have been hiring and training many thousands of local Chinese staff both in China and back here on secondments to be world class professionals.
Australian professional services firms that are already experienced in China and are ready and eager to embrace the open market opportunities from the FTA in both services, trade and further direct investment.
From personal experience, I know that Chinese clients like to see case studies of successful projects before buying professional services. The Chinese also have a famous proverb “Only he that has travelled the road knows where the holes are deep”.
Take advantage of opportunities
I am very confident that the Australian professional firms can demonstrate how they have advised and supported clients in the following sectors that are really important for development in China:
- Private wealth, superannuation & funds management
- Financial derivatives and asset securitisation
- Strengthening capital markets regulations and corporate governance
- Private hospitals and aged health care
- Environmentally sustainable urbanisation and agribusiness
- Safe and efficient food processing and cool chain logistics
- Tertiary and vocational training for China’s domestic services employees
- Outsourcing of local government services to the private sector
There are still so many Australian firms and talented professionals who are not there and who need to urgently consider their market entry strategies to take advantage of the vast CHAFTA opportunities which won’t go live until early-mid this year but, with the FTA a reality, the clock is running!
*Doug Ferguson, is KPMG Australia’s Head of Asia Business.