ANZ Chief Economist Richard Yetsenga believes WA businesses should be looking to India as well as China for trade opportunities.
Yetsenga will provide his analysis and insights of what’s in store for WA—and Australia—when he speaks at the CCI and ANZ Economic Breakfast on 28 March.
He says while there are many opportunities for international trade with China for manufacturing, India is opening up with opportunities in the service sector.
“China was a manufactured goods story, a cheap place to produce, which is why people went in there with the added attraction that at some stage there would be a big enough middle-class, so that whatever you produced you could sell in a domestic market in China. It was perceived as win-win,” he says.
“In broad terms, that’s the way it’s worked out, and for WA obviously that foreign interest and innate growth of the Chinese economy has meant fantastic things over the last decade-and-a-half.”
Yetsenga says now is a perfect time to explore export opportunities as the local economy steers away from the commodities boom.
“India is a different story because it doesn’t actually have much of a manufacturing sector; it’s more of a service-led economy, so the opportunity is different. You are still, in a sense, seeing a similar dynamic, but a lot of the foreign interest in India is in the service sector.”
He says the outlook for WA appears challenging.
“The level of business investment still seems quite high—it doesn’t seem to have adjusted down far enough, even though commodity prices are up, which is helpful, but the signals up from the commodity sector are that those higher prices are not likely to result in more meaningful investment.”
Michelle Cowan, the senior coach of the new Fremantle women’s AFL team, will join Yetsenga as guest speaker at the event.