Expanding your business to Australia will not only allow you to attract the attention of new customers and increase your profit margins, but it will also help you project your business into the future. With the growing foreign policy threat in the United States and Brexit in the United Kingdom, some of the world’s most respected economies are changing, proving that relying on a single economy is risky in today’s changing social and political landscape.
Australia is a market that many companies have yet to break, which not only allows it to advance and rise above its competition but also strengthens its portfolio since it offers its investors and shareholders new sources of income that are of low risk and provide long-term rewards.
The country’s economy continues to perform well compared to other markets despite the crisis unleashed by COVID-19. It reached a growth rate of 3.3% during the third quarter of 2020 after contracting 7.0% in the first half of the year.
It is easy to enter the market.
Entering the Australian market is another reason why so many investors choose to flock to the southern continent. With four different business structures (sole traders, partnerships, companies, and trusts), you can effectively set up a business and start operating within the country quickly. Their reasonable tax rates (Australians pay no tax on their first $18,200 earned, and then 19% cash on that up to AUD$37,000 before hitting the highest level of 37% on every $1 on AUD$87,000) is another benefit for entrepreneurs looking to expand. Of course, we recommend that you consult a specialist within the country before deciding to invest and launch a business.
Trade agreements with Latin America
Latin American companies have obtained good results in Australia thanks to the opportunities and trade agreements between Colombia and Australia. One of the most popular trade deals involves coffee, with US$31 million of trade between Colombia and Australia made up of coffee beans. Other agricultural exports include cut flowers, of which Australia buys US$6 million a year from Colombian farmers.
With trade increasing between the two countries (currently, US$52 million is imported into Australia from Colombia, up from US$18 million in 2006), it is possible to expand your business in Australia and benefit from its trade agreements to gain high-quality raw materials to manufacture and then pass on to wealthy Australian consumers, as long as you operate within the right niche.
Its mining sector is enormous.
One of Australia’s best-developed sectors is its mining industry, and as such, many Latin American experts flock to the country to take advantage of its rich natural resources. The sector contributes more than 7% to the country’s total GDP and is the third largest contributor, behind financial services and insurance. Brazilian firm Vale invested millions of dollars in the country to extract coal but has since stopped some mines due to poor market conditions. However, the government is also home to resources such as uranium and natural gas, with a CSIRO report suggesting the country has 140 trillion cubic feet of natural gas that can power a city of one million people for the next 2,800 years.
It’s no secret that Australia is one of the most attractive places in the world for international companies looking to expand within the territory. As more organizations understand its potential, foreign direct investment (FDI) will undoubtedly continue to grow and develop.