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Frosty Boy drives business through major Asia-Pac food expos

FROSTY Boy Australia, determined to become the world’s preferred dessert and beverage base manufacturer, is attending two of the region’s major food and beverage exhibitions to catapult its Asia-Pacific business.

In late March and April, the Frosty Boy is attending HOTELEX in Shanghai and Food&HotelAsia2016 in Singapore, viewing these events as prime opportunities to build on existing partnerships, while seeking new business prospects. 

Frosty Boy Australia, which this year celebrates 40 years of manufacturing, began exporting in 2001, and now supplies its powdered dessert and beverage bases to 48 countries, with the majority in Asia.

Frosty Boy CEO Dirk Pretorius said the company, with its production facility at the Gold Coast, manufactures the equivalent to two million serves of soft serve ice cream daily, with export making up 75 percent of business.

“We have already had great success in the Asia-Pacific region, with a great deal of our product being exported there, but there is still so much room for growth,” Mr Pretorius said. 

He said partnerships with Asian companies had been bolstered in recent times due to Australia’s improved trade agreements, positioning Frosty Boy and other Australian companies in high esteem to the rest of the world.

“Brand Australia in particular has contributed towards the company’s growth and is strongly recognised in international markets, particularly in China. Good quality Australian products, such as our beverage, frozen yoghurt and soft serve bases are in constant high demand,” Mr Pretorius said.

“We are already starting to see a substantial increase in the number of enquiries coming from China and believe that the China Australia Free Trade Agreement that came into force at the end of last year has instigated many of these.”

Frosty Boy general manager sales and marketing, Felipe Demartini said attending HOTELEX and Food&HotelAsia2016 would give Frosty Boy the opportunity to check in with existing partners, while meeting potential customers. 

Existing partners include Win Sin, a Singapore-based pastry, bakery and food service company.

“Partnerships like this are mutually beneficial. We help companies like Win Sin increase their profits with our products, while Frosty Boy continues to expand to maintain its year upon year growth of 15 percent,” Mr Demartini said.

Mr Demartini said he viewed the expos as great opportunities to showcase Frosty Boy’s products, while gaining further insights into the market to guide future research and development.

www.frostyboy.com.au.

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Robb signs historic trans-Pacific trade agreement in New Zealand

THE Trans Pacific Partnership Agreement (TPP) – which aims to see the elimination of 98 percent of tariffs among 12 countries – was formally signed on February 4 in New Zealand by Australia's Minister for Trade and Investment, Andrew Robb.

Mr Robb hailed the TPP as "the world’s most significant trade and investment agreement" and said he was elated that is was finalised after more than two decades of negotiations among member countries that, together, account for about 40 percent of global GDP. 

Australia’s exports of goods and services to these countries were worth $109 billion last year – a third of Australia’s total exports. In 2014, Australian investment in TPP countries was 45 percent of all outward investment.

Mr Robb said tariffs would be eliminated on US$9 billion of Australia’s dutiable exports to TPP countries, including $4.3 billion worth of agricultural goods with new levels of access for beef, dairy, sugar, rice, grains and wine.

A further $2.1 billion of Australia’s dutiable exports will receive significant preferential access through new quotas and tariff reductions.

Mr Robb said the TPP brought "enormous promise across both traditional areas of trade and investment and so-called 21st century areas like e-commerce and increasingly important global value chains".

“The tariff cuts will deliver material gains for our exporters across the board and place downward pressure on the cost of imported goods for households and businesses, but the benefits that will flow from the creation of a more seamless trading environment are not well understood,” Mr Robb said.

“The embrace of paperless trading, streamlined customs procedures and trading rules, assistance for SMEs, more seamless data flows and greater flexibility with data storage, are all features of the TPP. The agreement also contains provisions to help stimulate new investment and as experience shows, when you deepen trading relations increased investment inevitably follows.”

The TPP sets in place common rules for labour, the environment and, for the first time in a trade treaty, he said, rules "to combat bribery and corruption".

It will also ensure private companies and businesses are able to effectively compete against State Owned Enterprises (SOEs).

Significantly, Mr Robb said, the agreement would promote the expansion and diversification of Australia’s world-class services sector by liberalising key barriers, providing more transparent and predictable operating conditions, and it will capture future services sector reforms.

Some of the services areas that will benefit include Mining Equipment Services and Technologies (METS), professional services such as legal, architectural, engineering and surveying services; financial services, education, telecommunications, IT, transport, health, hospitality and tourism. Australian companies will also have new opportunities to deliver government procurement services.

Mr Robb said the TPP – which was open to other countries to join in the future – offered a pathway to a free trade area across the entire Asia Pacific region.

“Given its reach and potential this is an agreement we simply cannot afford not to be part of,” he said.

Each TPP country would now follow its own domestic treaty making process before the agreement can enter into force. In Australia this will include a Joint Standing Committee on Treaties (JSCOT) inquiry and the consideration by the parliament of any implementing legislation or amendments.

TPP members include Australia, New Zealand, the United States, Canada, Mexico, Japan, Chile, Peru, Vietnam, Malaysia and Brunei Darussalam.

www.trademinister.gov.au

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Australia gets tariff cuts on popular high-tech goods

EXTRA >>

TARIFFS on about  $19 billion dollars’ worth of popular high-technology goods imported into Australia will be eliminated under an agreement reached by the World Trade Organization (WTO).

Trade and Investment Minister Andrew Robb said the agreement, finalised at the recent Nairobi meeting, corrects the original Information Technology Agreement (ITA) struck back in 1996, when recent technologies such as touch screens, GPS devices, and lithium ion batteries were not covered.

Mr Robb said for the first time the ITA will now cover a range of consumer electronics including headphones, loud speakers and amplifiers, as well as video game consoles.  Medical devices such as magnetic resonance imaging (MRI) machines, electro cardiograph (ECG) machines and bionic ear implants – such as those made by Cochlear – will also be covered. 

“The agreement reached between more than 50 WTO members to expand the ITA means global tariffs of up to 35 percent will be eliminated on 201 high technology products, covering over US$1.3 trillion in global trade,” Mr Robb said.

“By eliminating tariffs on these technology products we immediately reduce their cost, potentially boosting demand and stimulating further innovation.  The ITA expansion will make it much easier to ship these heavily traded goods around the globe.”

Mr Robb said the ITA demonstrates that the WTO can still achieve practical outcomes to liberalise global trade.

“It has been 18 years since the WTO last agreed to eliminate tariffs.  The ITA is a good opportunity for the WTO to demonstrate its ability to deliver ambitious trade liberalising outcomes,” Mr Robb said.

Australia imports about US$18.9 billion worth of goods covered under the new agreement, and exports around US$3.6 billion. 

“Eliminating tariffs on these goods in Australia and throughout the globe will reduce costs across a range of sectors including retail, technology industries such as software design, and IT service providers,” Mr Robb said.

Australia plans to begin implementing its commitments on January 1, 2017. 

www.dfat.gov.au

Further information on the ITA can be found on the Department of Foreign Affairs and Trade websitehttp://dfat.gov.au/trade/agreements/Pages/information-technology-agreement.aspx.

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Indonesia orders bigger cattle quota

INDONESIA has announced it could look at importing about 600,000 head of live Australian cattle over the next year.

It is a major turnaround for an industry that was hammered by the fallout of the live cattle ban by the previous Labor Government – the result of Australian reaction to a Four Corners ABC TV report on cattle slaughtering methods. The unilateral action not only caused diplomatic and trade problems between the countries, it also financially ruined a range of farming family businesses in Northern Australia. 

Agriculture and Water Resources Minister Barnaby Joyce welcomed the news that the Indonesian Government has recommended up to 200,000 head of cattle be imported from Australia in the first four months of 2016, with an indicative annual quota of 600,000 head for 2016. 

“After our recent trip to Indonesia it is a very welcome sign to see the overall level of quota being maintained and movement towards an annual quota,” Mr Joyce said. 

“This really is great news for both the people of Indonesia and cattle producers in Australia. For some time we have said that the certainty of an annual quota would benefit not only Australian producers, but also consumers and processors in Indonesia. This news is certainly a step in the right direction. 

“Our live cattle trade is a big contributor to the economies of both nations, as well as the livelihoods and wellbeing of Indonesians and Australians. 

“Australia's relationship with Indonesia in the live cattle export industry is becoming stronger by the day. This is a win-win situation for both those in Indonesia who value-add and for farmers in Australia who it supports. 

“While we respect Indonesia's right to make decisions with regards to their imports, a periodic quota system makes for an uncertain trading environment. 

“Indonesia is our closest trading partner and our economic futures are closely linked. It’s a relationship that we place a great deal of importance on, and it's built on mutual trust and respect,” Mr Joyce said.

“The Australian Government will continue to work closely with the Indonesian Government to ensure the trade in live cattle is meeting both our countries’ needs and policies. That is why we continue to highlight what we think are the benefits of an annual system to both our nations. 

“Good inter-governmental relations between Indonesia and ourselves make this job so much easier. 

“We will continue to strive to be a reliable exporter of quality and safe agrifood products, and this government will continue to support the livestock export trade and the returns this trade brings to many farmgates.” 

Import permits are now being issued and will be valid for four months.

www.agricultureminister.gov.au

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Dingo hunts business in Latin America

MINING software and systems provider Dingo is looking to Latin America for growth opportunities in the wake of the global mining and resources industry shake up, which has seen the region take over Australia’s top spot in the sector.

Dingo managing director Paul Higgins said Dingo already exported 40 percent of its products and services overseas – and he was hoping to grow that figure substantially in the next few years. 

“These current conditions have challenged us to look beyond our normal markets,” he said after returning from a Mining Equipment, Technology and Services (METS) Trade and Investment Queensland mission to Peru and Chile.

“Latin America has been bumped to the top of the capital investment tree, driven by the demand for copper out of China, and we see that as a huge opportunity,” Mr Higgins said.

Dingo had been approached by South American and Mexican companies chasing partnership deals, which the company was evaluating.

“Australia is seen by this part of the world as a market leader in mining and resources technology, which opens the door for us,” Mr Higgins said.

“These markets are underserved and we are excited about the value we can deliver there.”

According to research group SNL, more than a quarter of capital raised in the first half of 2015 – about 26 percent – was directed towards Latin America, placing it ahead of Canada for mining and resources investment. There are currently 293 mining projects underway in South America worth between $290 and $316 billion.

Partly prompted by strong interest in Dingo’s products and services at Asia-Pacific’s International Mining Exhibition (AIMEX) held recently in Sydney, the company is also looking at global opportunities in Africa, Indonesia, China and Europe, according to Mr Higgins.

“Despite the current downturn in the Australian industry, we felt the AIMEX conference was well worth attending,” he said.

“The numbers were down, but that was a plus for us because it allowed us to stand out. And the companies that were there, were there for the long run, so it was quality over quantity.”

Mr Higgins said the number of Chinese exhibitors had skyrocketed at this year’s AIMEX conference, which should send a signal to the industry about future trends.

“This aspect of the changing international market does not create a big challenge for Dingo, because we provide highly specialist products,” Mr Higgins said.

“But it shows where things are going for mining generally and we have seen the impact of that already in relation to the big deal brokered in Mongolia.” 

Mr Higgins started Dingo from a Toowong apartment in 1994, but the privately owned company now manages more than $6 billion worth of assets and employs almost 50 people.

The company intends to grow these numbers dramatically in coming years as it expands its geographic footprint.

Dingo systems, founded in 1991, provide condition management solutions to asset-intensive industries and the firm currently manages the health of more than $7 billion worth of heavy equipment. Dingo’s software and expert advisers are widely used by the mining, energy, and rail sectors.

www.dingo.com

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Frosty Boy Australia breaks into China market on back of trade talks

FROSTY BOY chief executive Dirk Pretorius returned to Australia recently with a positive outlook for the country’s manufacturers and businesses looking to break into the Chinese market.

Mr Pretorius joined a recent trade mission to China with Andrew Robb, Minister for Trade and Investment, and is fully supportive of the recent Free Trade Agreement (FTA), which he urged to receive the full support of the Australian Government.   

“The FTA with China represents significant opportunities for many industries and businesses in Australia looking to expand into this massive market,” Mr Pretorius said. 

Frosty Boy has identified potential business growth and prospects in China that Mr Pretorius said will be realised or will be enhanced from the FTA, should it come to fruition.

With Frosty Boy currently servicing 48 countries, including China, 75 percent of Frosty Boy’s business is in export markets.

Felipe Demartini, Frosty Boy national sales and marketing manager, said through its research and development arm of the business and international experience, Frosty Boy is keen to work with local domestic businesses and franchisors to expand into new markets, including China.

“Working in partnership, we will be able to bring an exciting taste of Australia to China’s doorstep,” Mr Demartini said.  

Frosty Boy recently received world leading food safety certification, providing retailers and suppliers across the globe with assurance the manufacturer is delivering the highest possible production standards. The manufacturer’s new facility in Yatala has received an ‘Excellent’ rating in its Safe Quality Food (SQF) audit.

An independent assessment, SQF is an internationally recognised food safety and quality management system and provides certification the manufacturer complies with food safety regulations in both domestic and international markets.

“This certification provides our customers with added confidence that the Frosty Boy products are manufactured using best practice systems,” Mr Demartini said.

“An SQF rating is an internationally recognised program and helps us reach new markets both here in Australia and overseas.”

www.frostyboy.com.au

www.blendbeverages.com.au

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Minister Andrew Robb and the Australian Ambassador to the People’s Republic of China, Frances Adamson. 

AACCI calls for Australia to fast-track trade with Saudi Arabia

THE Australia Arab Chamber of Commerce and Industry (AACCI) is urging the Australian Government to commence negotiations with Saudi Arabia on a Double Taxation Agreement.

“Bilateral investment between Saudi Arabia and Australia, particularly infrastructure, real estate and agriculture, is encumbered because the effective corporate tax rate is up to 50 percent (20% in Saudi Arabia plus up to 30% in Australia)” the AACCI CEO, Suzannah Moss-Wright said.

“As part of the Government’s on-going efforts to improve international competitiveness in Australian business, we encourage the Australian Government to commence negotiations on a double taxation agreement between the two countries.”

Ms Moss-Wright said Australian business would benefit from diversified funding sources. Saudi Arabia is abundant with private financial wealth in excess of US$1 trillion, and growing at a projected rate of 9.3 percent a year between 2014 and 2019, according to the Boston Consulting Group.

"Such monies remain distant whilst the Australian Government requires the Gulf Cooperation Council (GCC) (comprising Bahrain, Qatar, Oman, Kuwait, Saudi Arabia and the UAE) to recommence negotiations on a Free Trade Agreement (FTA), before Australia engages in negotiations on double taxation agreements with the Gulf States," Ms Moss-Wright said.

Australia’s trade in agricultural products with Saudi Arabia, in spite of positive progress in recent years, is lagging far behind its potential, according to the AACCI.

Australian market share of chilled beef imports to Saudi Arabia has increased from 3 percent in 2010 to 7 percent in 2015. Saudi Arabia’s population is expected to grow at 1.5 percent annually over the next decade. It has an expanding middle class demanding higher quality proteins and grains. This presents opportunities for Australian companies involved in dairy, animal feed, beef and sheep farming, said AACCI. 

“Australia could become a strategic partner for Saudi Arabia in its search for investment opportunities to develop greater food security. We anticipate increased investment in Australia from Saudi Arabia if a double taxation agreement were enacted,” the AACCI CEO said. “The Australian Government has developed a compelling value proposition for investment in Northern Australia that could be of interest to Arab investors if an attractive tax regime could be established.”

During the first half of 2015, Australia exported more chilled and frozen meat to countries of the Middle East and North Africa region (MENA) than to China, according to the Federal Department of Agriculture Comparison Table for Calendar YTD.

AACCI advocates broadening Australia’s trade focus, and intensifying attention on the Arab countries of the MENA region to safeguard long-term economic growth in Australia’s agriculture sector. Export market diversification is essential to buffer price variation and demand shocks in specific markets. China’s demand for Australian meat declined 11 percent in the past year.

FTA negotiations with the Gulf Cooperation Council commenced in 2007, and five rounds of discussions followed. No formal discussion has been had since 2009. Australia and the GCC are considering re-commencement of negotiations, however both parties are involved in discussions with other countries that could take precedence over a GCC-Australia Free Trade Agreement.

“It might be a number of years before negotiations on the GCC-Australia FTA formally recommence,” Ms Moss-Wright said.

"n the interim, AACCI urges the Australian Government to commence negotiations on a double taxation agreement with Saudi Arabia. Presently, Australia has 44 ratified double taxation agreements.

"To date, Australia has not commenced negotiations for a double taxation agreement with any Arab league states. Australia had a double taxation agreement with China for 26 years before concluding the FTA in 2014. Similarly a double taxation agreement preceded the FTA with Japan by 44 years and 31 years with Korea. This suggests that double taxation agreements pave the way for free trade agreements.

“A tax treaty with Saudi Arabia would reduce the incidence of double taxation, provide greater tax certainty for business, and increase appeal of each to the other as an investment destination," she said.

"It would also improve access of Australian firms to Saudi Arabia’s $1.2 trillion worth of infrastructure developments currently planned or underway. Saudi Arabia is also mineral rich with significant deposits of bauxite, copper, gold, iron ore, lead, silver, tin as well as non-metallic minerals. With the decline in oil revenues, Saudi Arabia now has an increasing push into precious and base metal mining, presenting an opportunity for Australian contractors and engineering firms to capitalise on our advanced mining service expertise in a growing market.”

AACCI has welcomed the Australian Government announcement on September 21 this year that it intended commencing negotiations on a double taxation agreement with Israel, to whom Australia exported $243 million of merchandise goods in 2014; and imported $710 million of goods.

“The Australian Government recognises that the absence of a double taxation agreement holds back closer bilateral economic and financial linkages, and we support initiatives to remedy this,” Ms Moss-Wright said.

AACCI is also encouraging the Australian Government to similarly commence negotiations on a double taxation agreement with Saudi Arabia, to whom Australia exported $2.26 billion of merchandise goods in 2014; and imported $426 million of mostly fertilisers and plastics.

AACCI also encourages the Australian Government to enter into negotiations for an investment protection agreement with Saudi Arabia.

Currently, Australia has 22 bilateral investment protection agreements. The only country with which both Saudi Arabia and Australia have investment protection agreements is China, the AACCI said.

"This means that to safeguard Saudi Arabia’s investment in Australia, the investor would incorporate a company in China, and use that Chinese company to invest in Australia," Ms Moss-Wright said. "This results in Australia losing the benefit of direct relationships with its investor, potentially limiting further investment in the future and impeding bilateral trade opportunities."

Saudi Arabia is the 19th largest economy in the world with a GDP of US$752 billion in 2014. It is the third-fastest growing economy in the world with an annual average growth rate of 5 percent over the past 10 years. This achievement is only preceded by China and India.

Fortunate to have 25 percent of the world’s proven oil reserves within its borders, and the fourth=largest natural gas reserve in the world, Saudi Arabia represents a compelling prospect for Australian business to develop a commercial relationship.

The Australia Arab Chamber of Commerce and Industry is hosting a seminar at the Four Seasons Hotel, Sydney, commencing at 5:30 pm on Tuesday, October 20, 2015 to discuss agribusiness opportunities for Australian companies in the Arab world, with a particular focus on Saudi Arabia.

“We are honoured that the Ambassador of the Royal Embassy of Saudi Arabia in Australia, His Excellency Nabil Al Saleh will be speaking at our seminar,” said Mohamed Hage, the AACCI (NSW) chairman.

“Following the Ambassador’s keynote address, international trade experts from Meat and Livestock Australia, Rabobank, Export Council of Australia and AACCI will discuss trends in trade of agricultural products between Australia and the Arab world.”

www.austarab.com.au

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