Surprising results from the biggest ever Pacific exporter survey | Pacific Beat

Surprising results from the biggest ever Pacific exporter survey

Surprising results from the biggest ever Pacific exporter survey

Updated 30 July 2014, 18:56 AEST

Pacific island businesses want export opportunities rather than aid according to a new survey.

The Pacific Export Survey 2014 is the most comprehensive survey of exporters ever conducted with more than 350 responses from across all the 14 Pacific Forum nations.

International economist Tim Harcourt, from the University of New South Wales, is a consultant on the survey.

He told Jemima Garrett there were a number of surprising findings including the leading role being played by female entrepreneurs.

Presenter: Jemima Garrett

Speaker: Tim Harcourt, University of New South Wales

HARCOURT:  Interestingly Pacific women are showing the rest of us how to do it because when you looked at the number of exporters in the Pacific about 27 per cent of entrepreneurs are women. Now in Australia it is about 11 per cent in the exporter community, according to the DHL survey, so you've got three times the number of Pacific women getting into the exporting game compared to Australia so that was a quite interesting finding.
 
GARRETT: You also found that there were quite a lot of young companies and that confidence was quite high?
 
HARCOURT:  It is, yes, for new young SMEs (small to medium-sized enterprises). They were very, very keen to export. They had all the desire, all the aptitude, all the enthusiasm so certainly the demand is there and the enthusiasm is there and in many ways there is a great desire to look beyond their own islands and look beyond the Pacific itself.
 
GARRETT: You say that the survey shows that Pacific businesses want export opportunities rather than aid. What makes you say that?
 
HARCOURT:  Well, the survey said 'Look, we have had AusAID programs for years and we have had handouts but what we really want is commercial opportunities so we can build up our capacity', in the same way that the new economic development literature in Africa shows that the best thing that you can do is not to have another Bono or Bob Geldorf concert but to actually build up entrepreneurial spirit in Africa. It has actually been very good for these countries and we are seeing the same results in the Pacific and other emerging markets.
 
GARRETT: What did the exporters have to say about their priorities. Which markets are they prioritising and why?
 
HARCOURT:  Well, they don't want to just sell to each other. Australia and New Zealand are obviously their bigger markets, but they too are also looking to China and to ASEAN and to India and to the United States so it is very much 'Look we can sell to each other for so long but if we want scale we have got to look to our bigger trading partners' initially to Australia and New Zealand but they too want to look to China and India and the rest of the world.
 
GARRETT: It is still not easy for Pacific exporters to get their products to market. What are the biggest problems that they are identifying?
 
HARCOURT:  Well, I think it is basically scale. They are pretty small places, very small populations. Access to finance was a big issue and basically getting enough foreign investment. They said 'Rather than another big aid program we would rather have foreign investment into our businesses'. That is what they are looking for.
 
GARRETT: Now that too, wasn't very easy. What did you find was the response from foreign investors?
 
HARCOURT:  Well, they are still fining the Pacific a small expensive market. Political stability is an issue, economic stability is an issue. So I think the message is the most stable institutionally that the Pacific can be the better off they will be because they are always going to be fighting tyranny of distance and location, they are always going to be fighting transport costs, they are always going to be fighting scale so the best thing they can do is get their institutional house in order and they will attract more investment.
 
GARRETT: Now you say it is in the Pacific's interests to have a formal trade pact with Australia and New Zealand. Does that mean PACER Plus and, if so, what needs to be in that deal?
 
HARCOURT:  Well, I am sure that will be discussed during the leaders Forum but I think to the extent that they can have an internal market with Australia and New Zealand that will get them towards that first step in terms of scale and I think from there they will be able to get into China and ASEAN and so on. In the same way that Australia and New Zealand had the CER, the Closer Economic Relationship that is now 30 years old, since Trevor Chappell's underarm, and they have been able to expand that into ASEAN  then that has, too, given Australian and New Zealand exporters great scale, and I think that would be a great model for the Pacific.
 
GARRETT: Critics of PACER Plus say that it will benefit Australian companies much more than the Pacific. What needs to be done to ensure that doesn't happen?
 
HARCOURT:  Well, I think benefits for Australian companies are a good thing for the Pacific, particularly when they are looking for foreign investment. I don't think that is a bad thing at all. When New Zealand signed the CER with Australia thirty years ago - and before then New Zealand was so regulated you had to have a cabinet meeting before you could get a crate of frozen peas across the Tasman - they thought that would be Australia coming to rip off New Zealand but the evidence is that New Zealand has actually got fantastic benefits out of the CER. So I think in many ways a Pacific pact would also, ultimately benefit the Pacific nations.
 
GARRETT: What so you say to people who are concerned about access by foreign companies to land or that the services industries in the Pacific might be damaged by competition from Australia and New Zealand?
 
HARCOURT: I don't think it is so much competition, I think it is more having direct investment which is what the exporters want and most of the evidence shows that, over time, provided there is good institutions around land, good institutions around education and professional services, there will be benefits.
 

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