Luke Hartsuyker (Cowper, National Party) Share this | Hansard source

I welcome the opportunity to support the Export Market Development Grants Legislation Amendment Bill 2006. The legislation before the House today reminds us of the importance of overseas trade and export industries to Australia. I would like to focus on three vital areas which relate to export market development grants and the Australian government’s positive trade policy initiatives. Firstly, I intend to look at the merits of this legislation and its importance to the development of overseas trade opportunities. Secondly, I would like to highlight some examples of how export market development grants have assisted some businesses in my own electorate. And, thirdly, I will focus on the opportunities being created for our emerging exporters by the government’s free trade agreements.

However, before I address those points, I must challenge the comments made by the honourable member for Griffith in this chamber when he rose to speak on this bill. It is clear that the good member’s glass is half empty rather than half full. He attempts to paint a gloomy picture of our export performance. In his contribution he conveniently neglected to mention the substantial growth in the export of goods such as medicines and passenger vehicles. It has also slipped his mind that this country has achieved record exports across a range of sectors. The member for Griffith also paints a gloomy picture of the impact of our free trade agreements on a wide range of industries. Does he seriously believe that greater restriction on international trade can enhance trade performance? That is clearly a nonsense. A less restrictive trade regime builds greater national wealth for trading partners; but I will comment on FTAs later.

We can see where trade sits in Labor’s list of priorities, with the opposition having handballed the trade portfolio to no less than six different shadow ministers over the last six years. I say that the Minister for Trade hard work and vision has led this country into a new era of prosperity. There has never been more incentive to get emerging exporters ready for international business. In contrast, we have an opposition with no plans, with no ideas and with no meaningful policies in the area of trade. Perhaps the honourable member for Griffith should have taken some time to join me and the Deputy Prime Minister at the mid-North Coast innovation showcase held at South West Rocks. There were examples of regional businesses delivering world-class products and exporting to world markets. In most cases, they were not just following world’s best practice but were creating it by innovation—innovation being carried out in regional Australia.

In the 10 years this government has been in office, the value of Australia’s annual exports has increased by $53.5 billion. In that time, some 1.7 million jobs have been created under the coalition government, jobs that were just not there under Labor. Of those 1.7 million jobs, 320,000 had been generated through export performance. Currently, only five per cent of Australian businesses export, but that five per cent of businesses creates almost 20 per cent of Australia’s jobs. It is even higher in regional Australia, at 25 per cent. That is one of the reasons we are enjoying 30-year-low levels of unemployment. Imagine the possibilities if we can open up the world markets to another five per cent of Australian businesses. What jobs would we create? What wealth would we create? That is what export market development grants are doing: creating prosperity for businesses and jobs for Australians through making businesses export ready and through putting them in contact with potential trading partners.

I will now turn to the legislation itself and its relationship to future export trade. The legislation before us today will build on the success of the Export Market Development Grants Scheme and refine the program to make it more efficient and more effective. Under the sunset clause in the current legislation, the final grants to exporters will be paid in 2006-07. Owing to the immense success and popularity of the scheme, the government proposes to extend the scheme by five years, providing emerging exporters with further opportunities to market their products world wide.

One in five jobs nationally and one in four jobs in regional Australia are directly dependent on exports, and history shows that businesses which have been given access to global markets have experienced significant growth. The benefit of this growth is felt in the back pockets of the nation’s workers, with the 30,000 Australian businesses that export currently paying their employees on average $17,000 more per year than those businesses that do not export. This bill aims to keep this trade growth continuing and to give businesses with export potential the tools they need to get into the global marketplace.

Last year, 2005, was a record year for Australian trade, with exports reaching over $176 billion. Last year, 12 of Australia’s top 20 goods and services exports recorded record trade figures. We have copper ores up 76 per cent; coal up 63 per cent; iron ore up 78 per cent; natural gas up 41 per cent; medicines up 27 per cent and passenger motor vehicles up 12 per cent. There were also increases for wine, beef, education and business services.

In the 10 years it has been in government, the coalition has focused on providing the conditions whereby Australian firms can access world markets effectively and competitively. The government has facilitated exports through a range of measures—firstly, by pursuing trade opportunities on a multilateral and bilateral basis. The second way this government has helped exporters is by freeing them from the nightmare that was the sales tax system, a tax on exports—a tax acting against those companies that wanted to build wealth for Australia in the world marketplace. The third way the government will be helping exporters is through workplace relations reform. This reform is essential to making our labour markets internationally competitive.

This bill not only proposes an extension of the EMDG scheme but also specifies a number of improvements to the scheme which will make it more streamlined and provide further opportunities for emerging exporters not currently utilising the scheme. In 2005 Austrade conducted a full evaluation of the scheme and recommended its continuation. This recommendation was based on extensive consultation with some 394 submissions being received and no fewer than 70 meetings with business representatives, industry associations and government. In the bill currently before the parliament, several modifications stemming from the Austrade review are proposed. The bill proposes an increase in the claimable overseas visit allowance from $200 to $300 a day. It simplifies the rules on Australian content. Emerging exporters will be offered more flexibility with applications for funding that currently do not met the criteria.

The bill will ensure that expense categories for overseas representatives and marketing consultants are separated and capped to $200,000 and $50,000 per annum respectively. It will extend from three to five years the period for which Austrade can grant approval status to special applicant categories, the approved bodies, joint ventures and trading houses. This new piece of legislation will empower Austrade to reject unsubstantiated, unreasonable, uncommercial or non bona fide expense claims. The eligibility for cash payments made by applicants will be limited to $10,000 per annum. The bill also removes the export performance test, which has in the past made it difficult for some small businesses to access the scheme.

Last year, the EMDG scheme paid out some 3,200 grants totalling $124 million to small and medium export businesses. For that $124 million investment, those businesses generated over $3 billion in export revenue. I will repeat that figure because it is quite staggering: $124 million investment generated over $3 billion in export revenue. For Australia to prosper, it must have an effective trade system. A means by which manufacturers who produce high-quality products and international buyers can meet at the same table is through world trade—and the EMDG scheme facilitates that.

The good news for Australia is that exporters need look no further than the Pacific rim to access huge markets, such as Japan, the United States or China. The EMDG scheme is about helping Australian exporters contact international buyers. That brings me to my second point—the importance of EMDGs to regional and rural Australia.

In my electorate, exposure of business to external markets has proven crucial to business success and employment growth. I am pleased to say that local businesses have benefited directly from the EMDG scheme. A good example of that is a very small firm—which you would probably know of, Mr Deputy Speaker Causley—Dahlberg Surfboards in Yamba. In the highly competitive world of surfing, Rodney Dahlberg has managed to carve out for himself a niche market in Japan, using magazine print advertising and by sponsoring riders in Japanese surf tournaments. Mr Dahlberg says that EMDGs have been—and I will quote his very extensive words—‘a great help to him’, giving him the chance to put his product on the Japanese market. As a result, this small firm sells on average two surfboards a day into the Japanese market—quite a result for a small business operating out of a small country town in regional Australia.

Another example is the dental supply manufacturer, Erskine Products, in Macksville. General Manager Tim Erskine-Smith says that, without the EMDG scheme, he could not have ‘tested international waters’. With the financial support of the EMDG scheme, Erskine Products invested almost a quarter of a million dollars in attending trade shows, taking out commercials in trade magazines and doing test mail-outs. Similar testimonies can be given by a range of firms around the country. The extension of the scheme will see more success stories and more prosperity for local firms and their employees.

In my contribution to the House today, I would like to recognise the efforts of 30 young people who have just attended the Export Market Development Training Course, part of the Australian government’s Industry Partnership program. This program is designed to boost the understanding of young Australians in the areas of international trade and the export sector. The five-day intensive course held earlier this month in Sydney taught participants about how export markets work. It provided them with the skills to develop their own ideas and the motivation to develop an export business of their own.

The 30 participants were from a range of sectors, such as sheep and wool producers, brewers and winemakers, oyster farmers, beef producers and cheese producers. One of the participants was from my electorate. Timothy Zirkler, from Macksville, wishes to make a career for himself in the production of blueberries. The North Coast of New South Wales is home to some of the biggest producers of blueberries in Australia and provides work for a range of people—locals and backpackers. These blueberry farms have secured opportunities in the lucrative export Japanese market. Timothy knew about growing blueberries but not about how to sell his product on the global market—but that is changing, thanks to the Export Market Development Training Course. Young people like Timothy, who make up over 30 per cent of the workforce in agriculture, fishery and forestry, are being made ‘export aware’ through programs such as this.

I commend the Export Market Development Grants Legislation Amendment Bill 2006 to the House so that emerging exporters can have increased opportunities to take their products to international buyers, safely and effectively. Demand for the grants is increasing each year, showing the health of Australian business and the success of the scheme. Three-quarters of the grants awarded last year went to businesses with a turnover of $5 million or less and, of those, 23 per cent went to regional Australia.

At this point, I would like to return to the issue of trade negotiations. Free trade agreements have provided Australian exporters, especially those in regional Australia, with increased market access to the US, Singapore, Thailand and New Zealand—the first country to sign a free trade agreement. Since the Australia-US Free Trade Agreement was signed at the beginning of the year, cheese exports have risen by 103 per cent, two-thirds of US agricultural tariff lines have been reduced to zero and the majority of tariffs on lamb and mutton have been eliminated. In the first 12 months of the Australia-Thailand FTA, over 450 companies registered as active exporters. In last year alone, two-way merchandise trade grew by 30 per cent, helping to make Thailand Australia’s 10th largest merchandise trading partner.

In 2005, exports of services and merchandise to Singapore grew by 10 per cent and 23 per cent respectively. That is a very significant figure. The Singapore government revealed that it had chosen the University of New South Wales to establish the country’s first foreign university—the first wholly-owned research and teaching institution to be established overseas by an Australian university. Trade with New Zealand has grown by over 500 per cent since the signing of the FTA. Australian exporters are now anticipating the possibility of an FTA with China.

The Australian and Chinese governments began negotiations on an FTA after a joint study showed enormous potential benefits for both countries. China is already Australia’s second largest merchandise trading partner, our second largest imports source and our second largest export market. As a country of only 20 million people who consume only 30 per cent of the food and fibre we produce, we must export. There has never been a better time to develop Australian export business. If this government can educate and kick-start emerging businesses into the export sector, it will produce huge benefits for regional and rural Australia and for many small firms, stimulating considerable employment growth, all through the development of export opportunities.

There has been overwhelmingly positive feedback from exporters for this scheme and independent research has shown that the scheme has encouraged export promotion, which is a key factor in successful small business expansion. In the light of the reviews of the scheme and its track record of boosting Australia’s export industries, it is the government’s decision to extend the scheme, as I said, by another five years. I commend these changes. I commend the Export Market Development Grants Legislation Amendment Bill 2006 to the House and look forward to its passage so that we can continue to encourage our small exporters, continue to encourage export opportunities and all of the benefits that they bring to Australian companies.

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