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Growing markets
Distance is no longer a barrier to trade between France and Australia. The European Union, with more than 20% of the market, is thus Australia’s biggest importer. There is an abundance of opportunities for French businesses particularly in the pharmaceutical, infrastructure, information and communication technologies, services, biotechnology and mining sectors. Significant opportunities also exist in the agri-food and cosmetic industries.
► Infrastructure
| Investments in infrastructural development are essential to the continuation of Australia’s strong economic growth. Thus the states and territories are estimated to have spent a record 25 billion EUR in the development of their infrastructure, an increase of 20% from last year. |
These expenditures will total more than 90 billion EUR in the coming four years. The sectors to benefit most from these investment programs will be urban transport and water management. It is important to note that with the exception of Melbourne, Australia’s largest cities possess largely undeveloped public transport networks. However, Sydney has already made plans to expand its suburban train network in the coming years.
Water is another sector in which infrastructural improvements are crucial. The drought affecting the country over the last decade has highlighted the significant lack of infrastructure in this area. The majority of the states have thus committed considerable funding towards the construction of desalination plants and of water conveyance and recycling networks. Close to 20 billion EUR investment is necessary in the energies sector, particularly in the production of electrical energy, in distribution and in renewable energy.
► Pharmaceuticals
| Total government expenditure on health in Australia is valued at 47.6 billion EUR, equivalent to around 10% of the country’s GDP. French exports of pharmaceutical products increased in 2005 by 15.6%, following a 10.4% increase in 2004, an 11% increase in 2003 and a 24% increase in 2002. The Australian pharmaceutical industry employs about 35 000 people and records close to 10 billion EUR in annual revenue (the majority coming from human medication). |
Yet Australia’s local production only provides for 10% of national demand. The country’s main pharmaceutical manufacturers are subsidiaries of large Europe-based conglomerates. Amongst the French subsidiaries in Australia are Sanofi-Aventis, Laboratoires Servier, Fournier pharma and Pierre Fabre Médicaments. The 10 largest firms supply 71% of the total number of prescriptions.
Australia represents only 0.3% of the global population but consumes 1% of the world’s pharmaceutical products. Australia is thus the world’s 14th largest pharmaceutical market, despite being ranked only 53rd by population. In 2005, total imports of pharmaceutical products under the nomenclature of HS 30 rose to 4.19 billion EUR (an increase of 14.7% from 2004), of which 319 million EUR came from France (an increase of 15.5% compared to 2004).
► Minerals
| The mining sector represents around 10% of the Australian economy yet the island-continent remains largely unexplored. In fact more than 12 new sites have been discovered since the start of the 1990s, despite more than 100 years of mining activity. |
Australia possesses the world’s largest reserves (EDR) of lead, nickel, uranium and zinc, and holds the 2nd largest reserves (EDR) of gold, silver, bauxite and copper. Australia is also the world’s biggest producer of bauxite, aluminium, tantalum, and second largest for the production of lead, nickel, uranium and gold. It is the world’s largest exporter of carbon. This sector is currently in a period of considerable expansion as a result of growing international demand, notably from China and India, for primary resources. The mining sector is thus subject to an increasing proportion of foreign investments.
► Biotechnologies
| Australia has earned a world-class reputation in biotechnological research. This sector benefits from a number of assets: strong value-added research and development, globally recognised achievements, a transparent regulatory framework, an openly global strategy and strong government financial support. |
A thriving network of 427 biotechnology companies (190 in 2001) employing some 6 000 people is located in Australia. 49% of these are involved in human health (red biotechnologies) and 16% in agriculture (green biotechnologies). Around 625 companies are specialised in other types of medical equipment. The Australian biotechnology sector distinguishes itself by its flexibility and openness to research and commercial partnerships. The 2007 BioIndustry Review reported that in the past year, 345 partnership projects had been initiated between Australian biotechnology companies and organisations based overseas. Australia also possesses a highly active and dynamic nanotechnology sector. As a result, a significant number of companies and foreign government organisations have invested in the development and commercialisation of Australian nanotechnologies.
► Agro-food
| Australia offers French companies a number of opportunities in the agro-food sectors. In 2005-06, Australia imports of food products were estimated at 4.4 billion EUR (an increase of 6% compared to 2004-05.). French exports of agri-food products to Australia reached 120 million EUR during the same period, equivalent to an increase of around 17% compared to the previous period concerning mainly fine grocery goods: high quality condiments, gastronomic specialties, confectionery, wines and spirits. |
Wines and spirits represent 62% of French sales in Australia. Effervescent wines represented close to half the total value of French wine exports destined for Australia.
► Cosmetics
| The size of the perfume and cosmetic market in Australia is estimated at 2.2 billion EUR with anticipated yearly average growth at 1.8% for the period 2005-2010, after an annual average increase of 3.5% for the period 2000-2005. France is the world’s largest exporter of perfume and the second largest in terms of beauty products (behind the United States), with exports in 2006 estimated at more than 110 million EUR for the entire sector. |
► Information technologies
| Strong economic growth goes hand with significant expenditure in new technologies. In 2007, Australia's spending in this area reached almost 32 billion EUR, making it the 12th largest market in the world, despite being ranked only 53rd by its population. |
Australia is also the 5th largest market in the Asia-Pacific region after Japan, China, South Korea and India. The 24.000 Australian companies specialised in information and communication technologies generate a combined annual revenue of approximately 47 billion EUR. There are a significant number of market opportunities in relation to the Australian government (16.7% of the market is external to State and Territory governments), finance and business support (20.4%), retail trade and distribution (14.3%) and also transport and communication (12.7%).
► Services
| The service industry sectors, such as in information and communication technologies, education, environmental, personal services, finance, transport and health, present a number of favourable opportunities. Australia imports more than 7 billion EUR in services in a market estimated to be worth more than 80 billion EUR. More than 500 multinationals have established their Asia Pacific operations centres in Australia. Australia is one of the world’s most competitive locations in terms of innovation, technology infrastructure and a skilled workforce. |
Source:
- Australian Department of Innovation, Industry, Science & Research
- Australian Bureau of Agricultural and Resource Economics (ABARE)
- National Food Industry Strategy
- Hopper & Thorburn's BioIndustry Review 2007 - Australia and New Zealand
- Ubifrance
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