THE VECCI-Bank of Melbourne survey of business trends and prospects released today reveals that export activity, selling prices and investment levels in the tourism sector were strong over the three months to December 2014. 

“It is pleasing to see that tourism respondents reported some of the highest levels of capital investment and export activity, with these positive trading conditions expected to continue through the first quarter of 2015,” said VTIC Chief Executive Dianne Smith. 

“A contributing factor could be the low Australian dollar which encourages domestic tourism, as well as improves the value proposition of Australia as a long-haul destination for international travellers.”

Despite expected positive trading conditions in the first quarter of 2015, profitability in the sector is expected to decline, in part due to the continued rise in labour and wage costs.

Of the seven major industry sectors surveyed, the greatest number of respondents reporting that they were affected by penalty rates came from the tourism and recreation sector. 

Of the respondents affected by penalty rates across all sectors, almost all indicated they would provide additional working hours to employees or reinvest the savings back into their business if penalty rates were removed.

“The survey results show us that despite some strong performance in our sector, wage and labour costs remain a significant constraint on tourism businesses,” said Ms Smith.

“VTIC will continue to advocate for reforms that encourage jobs growth and improved productivity as visitor numbers grow in the sector.”

The Victoria Tourism Industry Council (VTIC) is the peak body for Victoria’s tourism and events industry, providing one united industry voice.

Tourism and events are growth industries for Victoria and contribute $19.6 billion to the state economy each year and employ more than 200,000 people.

vtic.com.au

ends

DIPLOMATIC representatives from countries as diverse as the United Arab Emirates, Jordan, Qatar, Egypt, Morocco, Lebanon, Kuwait, Iraq and Tunisia will attend a roundtable public hearing tomorrow for a federal parliamentary inquiry into trade with the Middle East.

Members of the Joint Standing Committee on Foreign Affairs, Defence and Trade will be asking the representatives of the Gulf states about a resumption of the free-trade negotiations with the Gulf Cooperation Council, which stalled in 2009.

The Trade Sub-Committee will also be looking for insights into how Australia can best grow its $16 billion in trade with a large countries such as Egypt, as well as the fast developing smaller nations like Morocco, Jordan, Tunisia and Lebanon.

Australia’s trade, investment and community engagement with the Middle East has been enhanced by the growing aviation links with 140 flights a week between Australia and the Gulf and the presence of more than 350 Australian companies in the region. Australian businesses are expected to take advantage of opportunities in the region with Dubai hosting World Expo in 2020 and Doha hosting the World Cup in 2022.

According to the Department of Agriculture’s submission, as the population grows in the Middle East, the demand for Australian-grown food such as wheat, sheep meat and other agricultural exports will also rise due to the physical limitations of the region’s arid climate, lack of suitable farming land and scarcity of water.

In 2012-13, Middle East countries imported more than $3.4 billion of processed and unprocessed food from Australia, and according to a Department of Industry’s submission, the demand for premium cuts of lamb and beef and other high-value foods will grow along with the popularity of premium restaurants, supermarkets and convenience stores in the region.      

Public hearing
Date/Time:  Wednesday 11 February 2015, 11:00 am
Location:      Committee Room 1R1, Parliament House, Canberra: 
Witnesses:    Diplomatic representatives of Middle Eastern nations

Live audio broadcast will be available at www.aph.gov.au/live

A PICK UP in export activity, sales and employment saw out the last quarter of 2014 for Victorian business but has not translated into improved confidence for 2015, according to the VECCI - Bank of Melbourne survey of business trends and prospects released today.

Encouragingly, exports, particularly among Victoria’s diverse manufacturing sector, rose for the quarter and were one of the few business indicators expected to continue to rise into the new year as a result of the lower Australian dollar and healthy underlying demand among our key trading partners.

Among other highlights of the quarterly survey of over 400 businesses across seven major industry sectors was the comparatively strong sales and employment performance of the wholesale and retail sector.

Unfortunately, the strong finish to 2014 has not led to positive sentiment towards prospects for the state and federal economies in the year ahead.

Although 17 per cent of respondents anticipate stronger economic growth for the Australian economy over the next 12 months, this is well below the 28 per cent who held this view in the previous quarter.

“These findings reflect the lowest level of optimism about the national economy in two years,” said VECCI Chief Executive Mark Stone.

For Victoria, 18 per cent of respondents anticipate that state economic conditions will improve over the year ahead, a fall from 25 per cent in the previous quarter.

Regional respondents were more optimistic about the Victorian economy than their metropolitan counterparts, with 22 per cent expecting stronger conditions over the year ahead, compared to only 16 per cent of metropolitan respondents.

“The results show enormous opportunity for the new Victorian Government and the Federal Government to deliver policy reforms that raise business sentiment and competitiveness,” said Mr Stone.

“Action to reduce business costs and provide long-term certainty is needed to ensure this is a one-off dip and not the start of a downward trend in business confidence.”

“The latest VECCI-Bank of Melbourne survey of business trends and prospects is a mixed report card for the Victorian economy, revealing a disappointing decline in business confidence,” said Bank of Melbourne Chief Executive Scott Tanner.

“However, the combination of relatively low interest rates and a weaker Australian dollar should ease pressure on Victoria’s key sectors and provide growth opportunities.”

Background – About VECCI

The Victorian Employers' Chamber of Commerce and Industry (VECCI) is the most influential employers’ body in Victoria, informing and servicing more than 15,000 members, customers and clients around the state.

www.vecci.org.au

Background – About Bank of Melbourne

Bank of Melbourne is investing in Melbourne and regional Victoria. Since re-launching in July 2011, the bank has tripled its workforce, opened 97 branches and become even more involved in the local community. The bank partners with the organisations and events that matter to Victorians. As a full-service bank, its team of lenders, account executives and industry specialists are supporting Victorian businesses, both large and small.

www.bankofmelbourne.com.au

ends

IMPROVING links between research and industry, and encouraging industry leadership to find, exploit and create business opportunities, are essential when competing with global businesses in the defence industry, according to the Department of Industry.

The department will give evidence at a public hearing tomorrow of the Defence Sub-Committee of the Joint Standing Committee on Foreign Affairs, Defence and Trade.

The Department of Industry works closely with the Defence Materiel Organisation’s Australian Military Sales Office, the Defence Export Control Office and Austrade to maximise export opportunities for Australia’s defence industry.

The department’s appearance at the hearing will provide an opportunity for the Sub-Committee to explore a range of challenges for Australian companies engaged in advanced manufacturing, including those companies supporting the defence industry.
 
Chair of the Defence Sub-Committee, Senator David Fawcett (SA), stated that, “While outlining what the challenges are and what is already being done, the inquiry will allow us to see if efforts can be better focussed to foster a thriving defence industry sector, incorporating research and innovation as well as manufacture and investment opportunities.”

The inquiry's terms of reference include identifying barriers and impediments to the growth of Australia's defence exports; how Government can better engage and assist Australian defence industry to export its products; the operation of the Defence Export Control Office; and assessment of the export support given to defence industry by governments of comparable nations.

Public hearing
Date/Time: Tuesday, 10 February 2015, 5.40 pm
Location: Parliament House Committee Room 1R1
Organisations: Department of Industry

The hearing will be audio broadcast live at www.aph.gov.au/live.