Immense potential to grow Australian-ASEAN trade, says new report

SINGAPORE - ASEAN as a group is Australia’s third biggest trading partner after China and Europe, but there is immense potential to grow, says ANZ Bank in a special report released ahead of the 2018 ASEAN Summit, being hosted by Australia in Sydney. “Although existing trade in goods and services is strong, much of it is concentrated in four of the 10 ASEAN countries,” the report says.

“ASEAN’s share of total trade with Australia has largely been stagnant in recent years, with the two-way stock of investments between ASEAN and Australia heavily concentrated with Singapore.”

The report says ASEAN’s thriving young population, growing middle class, and proximity to Australia make it a lucrative and obvious market for Australian businesses to expand into, especially when there is the opportunity to take advantage of the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA), which has been in place since 2010.

“We identify Indonesia and the Philippines as two countries where current trade ties are lower than what would be expected based on size and distance,” ANZ says.

“A successful conclusion to the Indonesia-Australia Comprehensive Economic Partnership negotiations could help lift Indonesia’s trade-to-GDP ratio closer to that of the other ASEAN countries with existing bilateral FTAs.

“There is also potential for further growth in trade and investment in key existing sectors like Education, Information, Communication and Technology (ICT), Healthcare and Mining.

“In addition, ASEAN’s increasing infrastructure gap creates immense opportunities for Australia to tap into.”  www.live.anz.com (ATI).