Question Time

Overseas Trade Offices

The Hon. K.J. MAHER (Leader of the Opposition) (14:22): My question is to the Minister for Trade, Tourism and Investment.

1. Has the government any costings for the new trade offices they have committed to establishing in Japan, Malaysia, the UAE, the US and Shanghai?

2. When does the minister think these offices will be up and running?

3. Will these offices utilise local employees, and what is the process to recruit such staff?

The Hon. D.W. RIDGWAY (Minister for Trade, Tourism and Investment) (14:23): I thank the Leader of the Opposition for his question. Certainly, we committed, as an election commitment, to opening five new trade offices: Shanghai, Tokyo, Kuala Lumpur, Dubai and somewhere in the US—obviously a major city, but in the election commitment we didn't indicate which city that would be.

As members would know, I went to Shanghai, Guangzhou, Shandong and Jinan about three weeks ago to start that process. One of our commitments was to start that process before the 100 days elapsed—in the first 100 days. As yet, we don't have any firm costs on any of those particular offices. We have some preliminary options that are being prepared for the Shanghai office. Clearly, China and the United States are our two biggest markets and the ones we are having a focus on, looking at how we might be able to bring those to reality as quickly as possible.

One of the issues we have is the former government closed a lot of these offices, particularly in China. You need to have a business licence or an operating licence in China and, as members would know, you can offend the Chinese government quite easily. Of course, closing an office and walking away has, in effect, offended them—a loss of face is the term that's often used. It's not just a matter of turning up and saying, 'Well, we want to open an office', and being able to do so. So we are working through the process of applying for a licence.

The Chinese Ambassador to Australia met with the Premier a few weeks ago. The Premier made it very clear that it was a new government, that we are actually wanting to do business with China, we weren't turning our back on them like the previous government had done and that we were very keen to reopen a trade office. So we are working through those issues in relation to the business licence and how we might be able to open an office, maybe even prior to that, maybe using some other way of opening the office but ultimately, I think, we will need to get our licence.

When I was in Shanghai I met with a number of ministers from the other states and they said it could take between 12 and 18 months to get that licence in place. That does present somewhat of a challenge for us but, nevertheless, I think we are up to it and we will look at ways that we can open some sort of presence in Shanghai at the earliest possible opportunity.

Clearly, we have had a very, very preliminary look at what might be happening in other parts of the world—the US, Kuala Lumpur, Tokyo and Dubai—and I have met with a number of ambassadors. Of course, we also had the visit from the sister state group from Okayama only a couple of weeks ago and made it very clear to them that we would love to reopen an office somewhere, probably in Tokyo. They are very keen to help, even though Okayama as a region or province is not close to Tokyo.

Other government and semi-government organisations, like Food SA, for example—members would be well aware of the role that Food SA plays and the great leadership of Catherine Sayer—have a permanent person in Japan, although I don't think in Tokyo. They have said that if we were to open a trade office, then they would probably look at relocating their person who is on the ground in Japan into that office. So there is quite a lot of interest in these particular offices, certainly from our exporters. People are saying that it would be good to actually have a doorway and a landing pad back into some of these markets.

It is interesting that, while I was in Shandong and meeting with the Jinanese, my recollection is that—it was a bit like their chamber of commerce, but it's not called that—we discussed trade missions and the trade missions the previous government had undertaken, quite large affairs of 200 or 300 business people, which are big events when you are in certain cities. It's interesting to have a look at the guest list for some of those events. I haven't actually seen the lists, but it can use a lot of taxpayer resources if you are having big events on a regular basis.

Often, the consular corps would know that the South Australians were having a party, the Aussies would let all of the other nations know that there was a party on, and because we have great food, wine, prawns and oysters, everybody clustered around. Members would know that I am a big fan of supporting our food and wine sector, but it also means that you get a lot of people from the diplomatic corps who are there. They are great people serving their countries, but does it actually grow our economy? Are there businesses that want to do business? Are there business people that can open doors for our exporters? Probably not.

It is interesting that the president—as I said, my recollection was of the Jinan chamber of commerce—said that you have these big events, you run around and collect all the name cards, as they call them (we call them business cards), have lots of toasts and drinks and then everybody leaves. At the end, he said, you have a pile of name cards that you put in a bin, because the contact is too superficial. So one thing that we are going to focus on is actually having and building more of a relationship.

Clearly, when we open these offices, whenever that may be, we will want to make a bit of a statement because, of course, we are back in town—South Australia is open for business, but we will have a much more focused approach to our trade missions.

The opposition leader asked about employees—that is unresolved at this stage. Clearly, there are some expats in some of these markets who have market intelligence, live there and know the state of play. Of course, if they live there and are locals living in those particular cities and countries and are looking for a new challenge to come to work for the South Australia trade office, it is often much more fiscally responsible to employ somebody that lives locally, rather than try to relocate somebody from Australia to run these offices, because, of course, you often have a relocation package and there is education and a whole range of things that I think are the standard across most of the states and the commonwealth when it comes to relocating.

When the opposition leader asks questions in relation to the sort of staff, we actually haven't made any decisions. There have been very limited inquiries at this point, but clearly you can see that you will have more bang for your buck, shall I say, if you employ locals. I think there might have been some initial requests for information from those that might be in the China market in Shanghai to gauge the level of interest that might exist there, but that is unresolved as the actual model that we will use for employing employees in these particular offices.