Study to mark US role as Australia’s best investment pal
US business executives are backing a study of American investment in Australia to help draw attention to the strength of US-Australia ties after years of focus on Australia’s growing links with China.
The American Chamber of Commerce in Australia and the US Studies Centre in Sydney yesterday announced plans for a research project to look at investment flows between Australia and the US.
Launching the study in Sydney yesterday, AmCham chief executive Niels Marquardt said two-way investment between Australia and the US was “the strongest and most enduring one this country has”.
He said the results of the study, which will be conducted by University of NSW economics professor Richard Holden, “would change the way we talk about foreign investment in Australia at all levels — among the leadership and the general public”.
The US is the biggest single foreign investor in Australia, representing 22.4 per cent of the total foreign investment by 2015, compared with 6.3 per cent from Hong Kong, 5.8 per cent from Britain and only 4.9 per cent from China.
While investment from China has been increasing in recent years, 2015 saw $860 billion worth of fresh investment from the US, making up 28.4 per cent of new foreign investment, well above the $500bn from Britain, which represented 16.5 per cent of the total.
New investment from China during that year was $75bn, seventh in the list of investment regions, or 2.5 per cent of the total.
US Studies Centre chief executive Simon Jackman said yesterday that the US was the single largest source of investment into Australia and the single largest destination for outbound investment from Australia.
“The centre wants to better document the nature of the US-Australian economic relationship by doing in-depth case studies, surveying business about previously undocumented issues, such as the value of US expertise in business operations, and looking at key economic indicators to see the full story.”
Professor Holden told The Australian that there had been a lot of emphasis in recent years on the fact that China was Australia’s largest trading partner.
“China is very important to Australia in that regard, but from an investment perspective the US is vastly bigger than any other player,” he said.
“There is the actual investment but also the intellectual property and knowledge transfer from US companies investing here.
“It is the American investment in Australia that makes our trade relationship with China possible.”
Professor Holden said US companies employed more than 335,000 people in Australia.
He added that US companies, such as Bechtel and ConocoPhillips, had been involved in major LNG projects in Western Australia and Queensland, which were driving Australia’s exports to Asia.
“It’s not just the dollars invested, it’s also the intellectual property that comes with it, as highlighted by these projects.”
Glenda Korporaal is Associate Editor (Business) in Sydney for The Australian. The original article published in The Australian is available here.
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