Australian Business in Europe (France) Submission to the Trade Sub-Committee of the Joint Standing Committee on Foreign Affairs, Defence and Trade, Parliament of Australia

In April 2018, ABIE France was invited by the Joint Standing Committee on Foreign Affairs, Defence and Trade (JSCFADT) to contribute a submission for their inquiry into the access to free trade agreements by small and medium sized enterprises  for examination and report to the Parliament of Australia.

The inquiry is being conducted by the JSCFADT’s Trade Sub-Committee, chaired by Mr Ted O’Brien MP with Mr Graham Perrett MP as Deputy Chair, shall examine the opportunities and challenges facing small and medium Australian export-oriented businesses that are seeking to leverage free trade agreements for the export of goods and services.

Further details about the inquiry, are available at www.aph.gov.au/jfadt.

ABIE France’s submission has been published by Parliament and can be viewed here.

Australian Business in Europe (France) Submission to the Trade Sub- Committee of the Joint Standing Committee on Foreign Affairs, Defence and Trade, Parliament of Australia

1. ABIE France
Australian Business in Europe “ABIE” France is a not-for-profit business association that brings together companies and professionals who have Australian interests and connections.

With close to 100 corporate, business and individual members, ABIE France helps strengthen business links between Australia and France and furthers members’ interests in France and Europe. It provides a forum for companies and individuals to engage with Australian federal and state government representatives and business experts and to forge business relations.

  1. In the context of Free Trade Agreement (FTA) negotiations between Australia and Europe, ABIE wishes to advise the Inquiry of matters relevant to SMEs seeking to do business in Europe, notably France.
  2. Australian business in France
    ABIE commends the Vision Statement on the Australia-France Relationship made by Prime Minister Turnbull and President Macron on 2 May 2018 (Vision Statement). It reflects the growing commitment of the two governments to this relationship within the broader parameter of the EU-Australia FTA.
  3. ABIE acknowledges the work of Austrade and DFAT in assisting Australian businesses to succeed abroad. It is also noted that the Australian federal and state governments provide trade assistance to Australian companies in Europe through the Export Market Development Grants Scheme, ad hoc referrals and trade delegations. Nevertheless, the number of Australian SMEs exporting goods and services to France remains small.
  4. Europe is a diverse market with varying needs and levels of sophistication. France is a highly sophisticated and competitive market. It presents significant language and administrative challenges for Australian businesses. In the context of Brexit, we see France seeking to simplify its administrative, fiscal and social regulatory frameworks to be more attractive for business and investment. However, many challenges remain for Australian SMEs.
  5. Recommendations
    ABIE recommends that the Government confirms its strategic priority areas for exporting goods and services to Europe. Despite being a sophisticated market, there are areas where France can benefit from Australian goods and services. For example, Ramsay Healthcare has been successful in the French private medical clinic sector in France. We refer the Inquiry to our previous submission on mutual development opportunities: https://www.aph.gov.au/DocumentStore.ashx?id=5d4cb473-b0b4-4a48-a165- a40de393b421&subId=509452
  6. ABIE recommends a comprehensive analysis of Australian SME capability to identify areas where Australian companies have developed niche technologies or services with a potential to develop in Europe.
  7. Any such evaluation should genuinely take account of Australia’s commitment to stopping climate change including its commitment to the Sustainable Development Goals and the recent Australia-France Vision Statement. ABIE considers that genuine action on this issue is of particular importance to the French government.
  1. It is clear that in order to succeed in France, Australian SME’s would benefit from support which goes beyond the framework of a typical FTA. ABIE recommends that the Inquiry considers both ‘tried and true’ and new ways of supporting exporters including:
    1. Mentoring programs involving the Australian expatriate business community in France which has extensive experience doing business in France.
    2. Australian and French governmental cooperation to showcase Australian SMEs at major European events (for example VivaTech) in order to give legitimacy by association which is essential to success in France.
    3. Targeted government led delegations to France to visit strategic sites, make introductions and host seminars on doing business in France.
    4. Austrade, DFAT and French government assistance with understanding the administrative culture and practice in France (considered by startups as the most dispiriting and difficult aspect of doing business in France). This would include education, practical support and myth-busting in the context of an evolving regulatory landscape. Referrals to help SMEs to seek advice on French business culture and labor law would be beneficial. More creatively, assistance could include aspects of history, politics and culture which would help understanding and lead to efficiency.
    5. Joint French and Australian government assistance for Australian SMEs currently headquartered in London needing to relocate to Europe following BREXIT. Paris is one of the true global cities in Europe, with high quality infrastructure, skilled people, research incentives, excellent access to the rest of Europe and an unparalleled cultural and intellectual life.
    6. Innovative Franco-Australian partnerships. For example, Australian SMEs partnering with French companies that are present in Australia.
    7. Having regard to the fact that SMEs are not often well-resourced or connected, better information for SMEs on:• Useful websites publishing developments and opportunities in Europe in priority areas (noting the variety of French initiatives)

      • EU and WTO rules on tendering for projects in Europe • FTA advantages for SMEs

    8. Greater investment in language training and business and cultural exchange with France for startups, social businesses, freelance workers, graduates and executives. This may include working locally in Australia with French expatriates.
  2. ABIE also considers it valuable to provide SMEs with greater visibility on the way that the FTA will operate to protect foreign business in Europe, particularly in respect of supply chain risks and intellectual property.
  3. ABIE supports the submission made by the German Australia Business Council to this Inquiry, in particular in respect to the current challenges to labor mobility between Australia and Europe, which should be addressed in the FTA. ABIE also agrees with GABC as to the key role of industry associations in facilitating better business.
  4. We note that France undertakes a number of interesting initiatives to assist its own companies to succeed abroad. We recommend that the Australian Government look at the programs and initiatives undertaken by, for example, the French Tech Ticket initiative, Business France and the business association MEDEF International to facilitate French exporters.

13. Conclusion

ABIE thanks the inquiry for its time. In short, given the characteristics of the European market, Australia needs a strategy for identifying and promoting the right business here. Beyond this, SMEs need opportunities to be visible and support to appreciate the cultural and business context in Europe. This is as critical to their success as favorable trade terms.