From Australia to the world

With the right kind of help – the kind that addresses skills and efficiency issues, while modernising and simplifying support services – the whole Australian economy could benefit from a new era of trade.

"Costs associated with obtaining trade documents, as well understanding compliance obligations across 28 different government agencies, can be harder than it should be for a nation that wants to encourage trade.”

ANZ, along with the Australian Centre for International Trade and Investment, and the Australian Chamber of Commerce and Industry, have just released the 2023 National Trade Survey report.

The sixth annual survey spoke to business of all sizes from across Australia. It hoped to discover how industry could better support businesses and, through their success and growth, help grow communities around the nation.

Based on the data, the report makes five key recommendations, each of which aims to address a concern raised in the survey.

These include taking action to reduce skills shortages, investing in domestic productivity, modernising trade systems in a way the cuts red tape, increasing the accessibility of support services for business, and taking a unified approach to international trade.

Too much friction

It’s no secret trade and supply chains around the globe hit the reset button in the wake of the COVID-19 pandemic. The 2023 survey showed businesses are responding to supply chain disruptions and geopolitical tensions by diversifying.

But feedback shows the systems supporting this diversification aren’t perfect. While businesses are innovating and adapting, it’s important to understand what creates friction in trade flows.

Responses to the 2023 National Trade Survey showed businesses want more information on how to trade in international markets. The data suggest there are significant gaps in knowledge and understanding of free-trade agreements and trade-financing options that can reduce the cost of trade.

It also found administrative work and costs associated with obtaining trade documents, as well understanding compliance obligations across 28 different government agencies, can be harder than it should be for a nation that wants to encourage trade.

This year’s survey has specific questions for business that had previously traded internationally but had stopped, or those that had never traded. This group made up around 15 per cent of survey respondents.

Of that group, 38 per cent said they felt they did not have enough information to trade internationally. A further 33 per cent said the estimated returns from international trade did not justify the required investment.

The survey also asked businesses trading in the region for their views on risk in the current market. While it was clear from the results many businesses were proactively seeking new markets to manage that risk, there were some clear shared concerns.

Of those surveyed, 71 per cent named the need to diversify markets as a concern. Around 60 per cent identified geopolitical tensions.

In response to these concerns, respondents had increased marketing in new international markets (55 per cent), increased marketing in existing international markets (52 per cent), increased sales in Australia (also 52 per cent) and developed new products to help them manage risk (49 per cent).

As supply chains shift, 90 per cent of businesses that trade in goods nominated shipping and logistics as an area of major or moderate concern.

To address growing risks in this space, 51 per cent of respondents said they had paid more to secure supply chain services, 43 per cent had found alternative services and 34 per cent had moved to work with Australian businesses.

Somewhat concerningly, 29 per cent of respondents said they had no option for managing these risks. It’s here that more information and support from policymakers would really shine.

Australians in Asia

At ANZ, trade is in our DNA. We aim to be the best bank in the world for customers trading goods and capital across the Asia-Pacific region. That’s why we’re invested in addressing the concerns raised by businesses through this survey.

For 185 years, businesses in Australia and across Asia Pacific have relied on ANZ to help them move money and goods around the world. Today, ANZ has trade experts working with customers in more than 30 markets.

We have skilled people on the ground in 13 Asian markets and the geographies representing 75 per cent of global trade flows. Each year, we secure and facilitate the movement of $164 trillion, with payments made to and received from 149 countries in support of eight million customers.

Through projects such as the National Trade Survey, ANZ is advocating for an environment that supports Australian businesses, helping them harness trade to grow and help their communities prosper.

Mark Whelan is Group Executive, Institutional at ANZ

A version of this article was originally published on ANZ Insights