BUSINESSES outside of the mining sector could be raking in an extra $238.2 billion by 2021 if they are able take full advantage of the opportunities awaiting from Asia, a new report concludes.
Research by global business adviser Boston Consulting Group (BCG) found that in the past decade non-resource exports from Australia as a proportion of all non-resource Asian imports have fallen to 2.8 per cent from 3.1 per cent.
While it expects non-resource exports to Asia will be dragged higher over the next decade because of the sheer scale of Asian economic growth, it believes there are vast opportunities available for Australian business.
“The difference between the current trend of decline and a return to a 3.1 per cent share could be an additional $238.2 billion in non-resource exports by 2021,” BCG managing director Ross Love said releasing the report on Wednesday.
The report, ‘Imagining Australia in the Asian Century’, was initiated in conjunction with the Business Council of Australia, which drew upon it for its submission to the Henry taskforce into the Asian Century white paper.
The report profiles 13 Australian companies that have already made Asia a core component of their overall success, including ANZ, Leighton, Linfox Logistics and Crown.
It describes how Australian firms have found pathways to success by adapting their business models in response to lessons about the importance of specialisation, relationships and adaptability.
In 20 years’ time, the report expects many major Australian firms are likely to be integrated into Asian economies, operating in essence as regional rather than national business.
This would mirror Australia’s own history of state-based firms consolidating or expanding to serve a national market, and becoming more productive under competitive pressure as a result.
“The benefits this delivered are now taken for granted.
“In two decades this may be the case for those Australian exporting businesses outside the resource sector that moved early to integrate with Asian economies,” the report says.
While each of the case study firms developed its own strategy in Asia, common themes emerged — such as the ability to customise its product for Asian customers, that Australian firms cannot rely on their domestic growth strategies, and the need to adapt operating models to diverse and shifting Asian markets.
“Beyond the tremendously important growth of our resources industry, we believe we can create a future of a fully engaged Australian economy and society by studying those who are getting on with it,” Mr Love said.