A focus for many Latin American companies is to move across borders into the Asian markets. It seems that having success in these markets, especially in China, will lift their companies into global success. This trend is occurring the world over, and Asia-centric business perspectives can cloud judgment from seeing viable alternative options.
Landing first in more culturally friendly markets such as Australia or New Zealand offers many channels for easier access to Asia, as these countries are considered a gateway to Asian markets.
Australia and New Zealand offer great opportunities to position your company in one of the most prosperous regions in the world. We offer 5 top reasons to do business in Australasia.
1. Doing Business in Australasia – Robust Economies
Australia is approaching 29 consecutive years of economic growth, with an expected growth of 2.8% in its GDP over the next five years. This figure puts Australia in the lead for growth above all major advanced economies. This impressive performance has been supported by
- the country’s strategic location close to major Asian markets
- strong, stable economic policies: open economy integrated to global value chains
- dynamic industries demonstrating significant growth potential for the future.
What about New Zealand?
New Zealand’s economy also demonstrates a consistently robust performance, with annual growth averaging around 2.1% since March 2010, proving the economy’s resilience. Economists project that overall growth “will continue to be driven by strong tourism demand from Asia and increases in dairy exports.” The World Bank’s ‘Doing Business 2019’ report ranked New Zealand as the world’s easiest country to do business in.
2. Dynamic industries
Australia’s historical success in energy, resources and agribusiness industries has been complemented with the impressive growth of services, lead by education, tourism and financial service industries. The country is also leading new disruptive technologies applied in all these sectors, becoming a global leader in most of them.
Australia’s resources sector are key for the process of fast industrialization in Asia, whereas its agricultural commodities and premium food are in high demand worldwide.
New Zealand has a very export-driven economy, accounting for approximately 30% of its GDP. Excellent geological conditions and climate, as well as sophisticated farming methods and developing agricultural technology provide optimal conditions for forestry, horticulture, pastoral commercial operations. Primary commodities account for around 50% of the country’s total goods exports. Dairy products represent a significant chunk of this percentage – an industry in which New Zealand is one of the top five exporters in the world. Tourism, film production, and winemaking are also significant contributors to the economic development of the country.
3. Innovation and skills
Both countries house highly educated, multilingual and multicultural workforces, with a strong entrepreneurial spirit. The 2018 Human Development Index ranked Australia third in the world, well above many other major developed economies, and ahead of all members of the G7. The country invests approximately US$21 billion on research and development (R&D), being one of the world’s leading innovative countries. The country is ranked fifth in the world for global entrepreneurship, with almost half of all Australian firms active in innovation.
New Zealand is positioned thirteenth in the Human Development Index and its government is highly committed with the continued development of its workforce and skills: it has committed to raising R&D spending to 2% of GDP over the next 10 years (currently, spending is now equal to 1.37%).
4. Global ties
Australia and New Zealand have an open and globally integrated economy, making them trusted partners for trade and investment. Many large international actors have set up shop in one or both of the South Pacific island nations.
Australia has 11 Free Trade Agreements currently in force with major and emerging economic players. This includes the US, New Zealand, Japan, China, Republic of Korea, Thailand, Singapore, Chile, the Association of Southeast Asian Nations (ASEAN), Malaysia, Canada and Mexico (through the Trans-Pacific Partnership, or CPTPP). There are several others under negotiations. These agreements make Australia a perfect place to set up your business to get access to Asian markets easily.
New Zealand’s open economy is one of its most attractive aspects, ranking third in the world on the Index of Economic Freedom. The country has signed Free Trade Agreements with Australia, ASEAN, China, Thailand, Singapore, Korea, CPTPP and Malaysia (not yet in force).
5. Strong foundations
These countries also have strong institutions and stable democratic values, something which is strong valued by multinational companies when doing business. With economies open to foreign competition, transparent business processes, strong respect for intellectual property, and robust regulatory frameworks, both countries are attractive and dynamic destinations for investment.
Australia, with some challenges (as every country has), is positioned in eighteenth place of the easiest countries to set up and operate a business in the world. It only takes 2.5 days and a minimum of three procedures to start a business.
New Zealand, as mentioned before, is in the first position in this ranking. Some of the reasons behind this award are: the country ranks first on the Corruption Perception Index, and seventh on the OECD’s Better Life Index.
We offer key guidance and support
Australia and New Zealand offers significant commercial opportunities, and also an enabling channel to billions of Asian customers. When expanding into new markets such as Australia, you can depend on the expert services available at Biz Latin Hub, whether it’s for the incorporation of your company, visa processing, due diligence, recruitment or market entry.
Contact our business experts today via email on [email protected], and we’ll get back to you with a personalized strategy to help you maximize returns on your investment and position your brand in Australia and New Zealand.