Successive Australian governments have emphasised how important Asia is to Australia’s prosperity. The overall trade data suggests we are living up to this rhetoric. Yet it is increasingly hard to escape a feeling that Australia is still failing to reach its economic potential in Asia. Our trade and investment is concentrated in a few markets. Asian and Australian businesses say our regulatory environment is making it harder to business with us. Despite Government encouragement Australian business and investors are often risk averse and unwilling to explore new markets in the region. We seem to underutilise natural advantages that we have, including the large Asian diaspora living in Australia along with the Australians and alumni living in the region.

Disclaimer: The views expressed in any Asia Agenda articles are those of the individual authors and do not necessarily reflect the consolidated views or opinions of Asia Society Australia or its members. The publication serves as a platform for diverse perspectives on issues concerning Australia’s engagement with Asia, and we encourage open and respectful dialogue among contributors and readers.

Strategic and economic issues have become intertwined, but can they be reconciled. Will an economic security agenda, from tighter FIRB regulation to the Future Made in Australia initiative, undermine our ability to diversify our economic relationships in the region? How much bandwidth does Australia have for continued trade and investment diversification as relations with China stabilise? Does Australia need to be enmeshed in the economies of its near neighbours to be regarded as a reliable long-term partner in broader relations Or does more security engagement pave the way for better economic engagement? Can we combine security and prosperity goals, for example in the field of energy security?

Is Australia’s approach to trade and investment in Asia too transactional? With exceptions we don’t seem to be interested in building deep long-term economic relationships in the region. This is reflected in a range of things from the risk aversion of businesses and their unwillingness to work in new markets, to the apparent inability of big institutional investors in Australia to see Asia as an investment destination. Could we address this by first partnering with Asian companies on economic projects in Australia? This issue also applies to our approach to development assistance in the region where there is still a focus on providing “support” or “help” to Asia rather than a recognition that modern Asia is more interested in reciprocity where there are two-way flows of people and ideas. Even the Australian Government and business seem to struggle to partner, underlined by the lack of alignment between government development aid and offshore business policies and what Australian businesses are doing on the ground.

Australia already faces difficulties competing for trade and capital in the region. We are a small market. Some Asian investors are discouraged by foreign investment rules, perceptions of racism, and concern about over-regulation. Does this mean that Australia is missing opportunities that are going to others? Are the tensions between business and government inhibiting the ability to work together to pursue economic opportunities in the region? The energy transition in Asia is, for example, potentially a massive economic opportunity for Australia but are our prospects being undermined by the inability to set practical policy settings on energy domestically?

Australia’s education exports to Asia have been a major success for the country. But are we now sabotaging that success? International students are being blamed for everything from the housing crisis to declining exam standards. Universities are being held up as scapegoats for other Australian problems such as the housing shortages This seems no way to treat people who we also want to recruit to being diaspora champions of the Australian ways of doing things. Do we need a more consistent approach to educating young Asians in Australia and in their own countries?

One of Australia biggest natural advantages in doing business in Asia are the large Asian diaspora communities in Australia, as well as the resident Australians and alumni of Australian universities in Asia. Successive Australian governments have talked of leveraging these communities but has any real progress been made in this regard? And if not much has happened, is this solely the fault of government given that Asian Australians remain underrepresented on Boards and in the C-suite of Australian companies? Likewise, are we really drawing on the large Australian alumni in the region, capitalising on the idea that “Australia’s best friends are people who studied here?" Do we even know who they are?