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RURAL and REGIONAL COMMITTEE Inquiry Into Increasing RURAL AND REGIONAL COMMITTEE Inquiry into Increasing Exports of Goods and Services from Regional Victoria Final Report ORDERED TO BE PRINTED September 2014 By authority Government Printer for the State of Victoria Parliamentary Paper No. 343 (document 1 of 2), Session 2010-14 Rural and Regional Committee | Inquiry into Increasing Exports Copyright © 2014 Rural and Regional Committee. All rights reserved. National Library of Australia Cataloguing-in-Publication entry. Author: Victoria. Parliament. Rural and Regional Committee. Title: Final Report Inquiry into Increasing Exports of Goods and Services from Regional Victoria. ISBN: 978-0-9873325-5-4 (paperback) 978-0-9873325-6-1 (electronic) Notes: Includes bibliographical references and index. Subjects: Exports--Victoria. Foreign trade promotion--Victoria. Produce trade--Victoria. Export marketing--Victoria. Dewey Number: 382.4109945 This Report is available from the Committee’s website at: www.parliament.vic.gov.au/rrc ii Contents Terms of Reference ............................................................... ix Chair’s Foreword .................................................................. xi Executive Summary ............................................................ xiii Recommendations ..............................................................xxi Section I: Exporting from Victoria Chapter one: Introduction ..................................................... 1 1.1 Background .........................................................................................2 1.6 Key findings and recommendations ..................................................2 1.17 Scope of the inquiry .........................................................................4 1.28 More than just international exports ...............................................6 1.34 Different businesses and different solutions ....................................6 1.36 The inquiry process ...........................................................................7 1.41 Acknowledgement ............................................................................8 1.42 Structure of this report ......................................................................8 Chapter two: Victoria’s ability to compete ........................... 9 2.1 Competitiveness ................................................................................ 11 2.9 Victoria’s advantages .......................................................................12 2.34 Quality: a key advantage .............................................................18 2.50 A compact state ............................................................................ 20 2.58 Regional towns and cities ............................................................. 22 2.86 Victoria’s competitive disadvantages .......................................... 28 2.103 Using Victoria’s competitive advantages ...................................31 Chapter three: Current exports from regional Victoria .......33 3.1 Exports from the whole of Victoria ................................................. 34 3.4 What is exported from Victoria? ..................................................... 36 iii Rural and Regional Committee | Inquiry into Increasing Exports 3.14 How much of this comes from regional Victoria? ........................ 38 3.23 Education ....................................................................................... 39 3.33 Tourism ............................................................................................41 3.38 Export markets ............................................................................... 42 3.44 The movement of goods within Victoria ....................................... 46 Chapter four: The impact of exporting ................................49 4.1 The importance of exports to Victoria ............................................ 50 4.12 The impact of exporting on individual firms ................................. 52 4.23 Structural change .......................................................................... 54 4.37 Change in the manufacturing industry ......................................... 58 Chapter five: Increasing exports .........................................63 5.1 The global opportunity .................................................................... 64 5.7 Victoria’s potential for growth ........................................................ 66 5.18 Victoria’s capacity to grow exports ............................................. 68 5.28 Government plans to increase exports ........................................ 70 5.38 Data limitations .............................................................................. 72 5.51 Three levels of government ........................................................... 76 5.71 Adding value not just volume........................................................ 80 5.76 ‘Cashing in’ on the opportunity .....................................................81 Section II: Supply Side Chapter six: Investment and financing ................................83 6.1 The need for capital ......................................................................... 84 6.8 Capital for product development and commercialisation ............ 85 6.21 Capital for establishing demand in export markets .................... 88 6.34 Capital for scaling up production .................................................91 6.45 The Export Finance and Insurance Corporation ......................... 93 6.56 Foreign investment in Australia ..................................................... 96 iv Rural and Regional Committee | Contents 6.75 Victorian firms investing overseas ..............................................100 Chapter seven: Human resources ..................................... 103 7.1 Access to skilled workers ...............................................................104 7.18 Adapting to structural change ..................................................... 107 7.29 Skills to become export ready ....................................................109 7.49 Providing data for exporters ........................................................ 114 7.60 Access to skill development .........................................................116 Chapter eight: Infrastructure ..............................................119 8.1 Infrastructure in Victoria .................................................................122 8.7 Transport ......................................................................................... 125 8.16 Road vs rail ...................................................................................127 8.21 Rail .................................................................................................128 8.48 Roads ........................................................................................... 134 8.64 Intermodal hubs .......................................................................... 137 8.74 Ports .............................................................................................. 139 8.88 Aviation ........................................................................................ 142 8.102 Tourism ....................................................................................... 144 8.118 Telecommunications ................................................................... 148 8.125 Irrigation ..................................................................................... 149 8.131 Energy ......................................................................................... 150 Chapter nine: Government programs to increase competitiveness and productivity ..................................... 153 9.1 Facilitating collaboration .............................................................. 154 9.18 Research, development and extension ...................................... 157 9.40 Increasing value as well as volume ............................................161 9.52 Other programs to improve productivity ................................... 164 v Rural and Regional Committee | Inquiry into Increasing Exports Chapter ten: Regulation .................................................... 167 10.1 The role of regulation .................................................................. 168 10.11 The problem with regulation ...................................................... 170 10.22 Potential changes to regulation ................................................ 172 10.32 Commonwealth Department of Agriculture inspections ..........175 Section III: Demand Side Chapter eleven: Establishing relationships with overseas markets .............................................................................. 177 11.1 The role of government ................................................................ 178 11.6 Victorian Government Business Offices ...................................... 179 11.13 Austrade .......................................................................................181 11.19 Outbound trade missions ........................................................... 183 11.27 Inbound trade missions .............................................................. 186 11.34 Local government ....................................................................... 187 11.44 Free trade agreements and tariffs ............................................. 189 Chapter twelve: Promotion and branding ........................ 195 12.1 Promotion ....................................................................................
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