China-Australia FTA a game changer - HSBC
(22 June 2015 – China) The signing of the Free Trade Agreement (FTA) between Australia and the People’s Republic of China has been labelled a game changer by HSBC.
HSBC said in a statement the agreement adds to a growing list of developments supporting China-Australia connectivity.
David Liao, chief executive of HSBC in China, said: "We anticipate a shift in the profile of foreign direct investment from China, extending beyond large state-owned enterprises investing into Australian mining and resources, to include more private-owned companies investing in Australian services, tourism, agriculture and infrastructure.
"For companies at either end of the China-Australia corridor, success will depend on how well they understand the market dynamics and navigate the new liberalised business framework," Liao said.
Tony Cripps, chief executive of HSBC in Australia, said the FTA signing is a significant step forward in commercialising Australia's relationship with China.
"For the last decade, Australian companies have observed China's meteoric economic growth, yet many are still unclear on how to navigate the China market."
"HSBC's FTA research shows that 75 percent of Australian companies that embed FTAs within their business strategy experience a boost to exports and a competitive edge.
This China-Australia FTA puts Australian businesses in an unprecedented position to mobilise now their China strategy to capitalise on our trade pact with the world's largest economy and play a role in the further internationalisation of the Renminbi."
"China already receives the lion's share of Australian exports, with much of it concentrated in the mining sector. With the removal of trade barriers and reduction of tariffs across dairy, meat and wine exports, as well as priority access for Australian service companies in China, the FTA will usher in a new era of trade growth for Australian businesses linked to agriculture and services," Cripps said.
HSBC also welcomes the lifting of Australia's Foreign Investment Review Board screening threshold for private company investments.
At its global investor update on 9 June, HSBC identified Australia-China as a key trade and investment corridor supporting growing global trade and capital flows.