The UK remains a major market for Western Australian exporters, particularly in the oil and gas industries, as Gary Kleyn reports.
THE dominance of the United States, the emergence of the European economic community and Western Australia’s geographical proximity to Asia have sidelined the UK market in the minds of many of the State’s exporters.
Once WA’s largest trading partner, the UK has slipped to seventh place in bilateral trade, although it remains Australia’s third largest trading partner. Despite this, synergies still exist for WA companies supplying to the oil and gas businesses based in the North Sea, off the UK coast.
The UK’s economy is small when compared with the US, at about one-sixth the size. Its economy is about half the size of that in Germany, while along with France it is considered to have the world’s fourth largest economy.
In 2000-01, bilateral trade between WA and the UK exceeded $1.6 billion.
More recent data from the WA Department of Treasury and Finance indicates that, while overall exports from WA were 4.5 per cent higher in the three months to November 2002 compared with a year earlier, exports to the UK fell by more than 23 per cent. In the three months to November 2001, WA exported $411 million of goods to the UK. A year later for the same period, exports had dropped by $96 million to $315 million.
Despite this, the UK still remains well ahead as the largest European market for WA goods.
The UK comprises England, Scotland, Wales and Northern Ireland.
According to the Department of Foreign Affairs and Trade 2002 Outcomes and Objectives Statement, the UK is Australia’s largest market for wine, with exports in 2000-01 of around $742 million accounting for 43 per cent of Australia’s wine export orders.
Austrade is giving 12 Australian wine producers who have not yet exported the chance to travel to the UK in May. Wine Quest Europe will give the companies the opportunity to exhibit at the London International Wine and Spirit Fair on May 20-22, with Austrade to pay the cost of airfares and exhibition space.
The signing of a memorandum of understanding in November 2000 in relation to e-commerce, e-government and cooperation in the information technologies industries is expected to open more doors for Australian businesses. More than $50 million worth of contracts are already in place as a result of the MOU. The UK’s IT sector is the fourth largest in the world. More than 100 Australian hardware and software companies are operating in the UK market.
Other key exports to the UK include non-monetary gold, coal, medicaments and lead.
Major imports from the UK include aircraft and parts, telecommunications equipment, print-ed matter and passenger motor vehicles.
The UK is also the second largest foreign investor in Australia with nearly $200 billion invested, while British businesses continue to use Australia as a regional headquarters. About one in three regional offices operating in Australia are European and of these almost half are British. Major investors include Shell, BP, British Aerospace, BT, and Vodafone. Key investors in the UK include News Corporation, National Australian Group, BHP-Billiton, Westpac, AMP, ANZ and Boral.
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