Funding Export Research

Ian Murray’s wishlist includes more money for export research and a comprehensive trade facilitation program.

Apart from the issues I raised last month, discussing the review on trade policy and programs, there are two things the Australian government could address to improve the performance of our exporters, in particular those that service the export sector.

The first is research. When one considers the investment made by governments at three levels and the private sector in developing and delivering a range of services for the sector we are talking about a substantial amount of money. However, the research budget for assessing these programs is extremely low. Hence there is a paucity of evidence to indicate that the delivery of the various export support programs meets the needs of exporters or engenders positive outcomes to export performance.

What spurred me towards looking at this need was the launch of the ‘Global Readiness Index’ study undertaken by the Export Finance and Insurance Corporation (EFIC). While most research tends to leave you saying “well I suspected that anyway”, nothing replaces factual data. Only with good research can factual data be generated, from which strategies evolve and sound programs put in place with at least a degree of confidence.

And it’s not just here in Australia where the problem exists. This week I have scoured the world looking for research that confirms there is a correlation between export education and export performance and to find out what form of education attains the best results. While everybody seems to agree that it must, nobody can prove it. As education and training is only one element in the mix, how can anybody determine the relative effectiveness of export programs without supportive data? Likewise how can anyone determine the real value of any of the other services provided to exporters?

What the government could do is establish a fully funded resource that would have an ongoing role in undertaking research into what factors influence export behaviours, including assessment of the value of government and private services supporting exporters. The resource would have a rigid criterion and be open to all bodies providing services to exporters, including government and the private sector, and possibly universities. Given the apparent void overseas, we could create world’s best practice.

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The second area worth looking into is that of trade facilitation where, compared to places like the United Kingdom, Australia falls well short. When I speak of trade facilitation, I’m not talking about marketing or the work Austrade does, I’m talking about managing the export process and all the elements that make up that process.

While Australia has done much to improve especially customs procedures, there is no overall trade facilitation program. As the world increases globalisation and concerns continue over supply chain security, trade facilitation will become increasingly important.

One field of trade facilitation that we can all relate to is documentation. While much information associated with an export consignment is electronic—EDNs, online permits, EXDOCs and so forth—there are others where faxes or PDFs or scanned images to an email remain the fundamental way of doing business.

Given the cost, poor productivity and the fact that many of our trading partners are moving rapidly towards paperless systems, this is clearly not good enough.

One of the problems is that the issue is not confined to just one government department; it goes across a whole range of departments. Despite that, I see no reason why the Government can’t take a holistic approach to trade facilitation and work with one body to bring it all together. In both cases, the payback would be substantial.

—Ian Murray is executive director of the Australia Institute of Export

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