The global financial crisis has taken some of the heat out of the oil-rich Middle East. In July, the Government’s Export Finance and Insurance Corporation (EFIC) warned businesses in Dubai to expect payment delays and contract renegotiations as the country’s construction boom came to an end, with up to $US250 billion worth of projects cancelled or postponed.
However, the Middle East shouldn’t be completely discounted.
“Dubai is a bit soft, but Abu Dhabi and Saudi Arabia are still very strong and still developing,” Murray says.
Qatar is another target. Melbourne-based company WWW Projects has just won a $74 million contract to manage, design, integrate and install the telecommunications and IT infrastructure for what will be one of the world’s largest ports in Qatar.
Qatar provides a great example of just how much wealth is in the region. Its economy has grown by an average rate of around 20% over the past five years and it now has a surplus of about $US130 billion to invest in the next five to seven years.
Property and infrastructure companies have been extremely successful in recent years, but opportunities exist in a range of sectors, including manufacturing, agribusiness, food and ICT.
The heat may have come out of the resources boom in the last 18 months, but Ian Murray says the continued development of long-term projects and demand from recovering economies is keeping miners busy – and that’s providing plenty of opportunities for the army of Australian mining services firms that provide equipment, technology and expertise for mining projects.
Tim Harcourt agrees. “This is where the new economy meets the old economy.”
Mining services company Industrea has won $7.5 million worth of contracts in the Chinese coal sector in the last three months (and over $100 million of contracts in the last 12 months) while Swick Mining announced it had secured its first United States diamond drilling contract on 11 August.
Engineering firms such as WorleyParsons and Ausenco have also recently pushed into markets as diverse as Africa, Egypt, Indonesia and Papua New Guinea.
Governments around the world are pumping money into carbon reduction initiatives, and making buildings more energy efficient is an area of focus. Markets that Austrade nominates as targets include Canada (where the green buildings sector is valued at around $18 billion) and the United Arab Emirates (where over 1,000 projects are seeking to be certified as “green”).
There are opportunities for a wide range of products and services to be exported in this area, from property management services, engineering services and construction services through to building products and monitoring equipment. One company pushing into the green building export markets is Brisbane-based manufacturer Centor, which recently launched a ne, fully retractable, fly screen and solar control blind. It hopes to double sales to Europe in 2009 and then push into North America.
The next big event on the green building calendar is the Indian Green Building Congress, to be held in Hyderabad, India on 10 September 2009.
“Australian expertise and professional services will assist nations like China and India to improve their environmental sustainability,” Harcourt says. “Signing Kyoto was important in improving Australia’s reputation as an environmentally conscious and innovation nation – it put the green back into the green and gold – and the global community anticipates that Australia will play a leading role at Copenhagen climate talks in December.”
While consumer spending has dropped around the globe during the downturn, Australian fashion labels continue to push into offshore markets. Lynda Slavinskis works with a number of fashion designers and manufacturers and says that while logic says fashion exporters would be struggling right now, there are opportunities for savvy operators.
As veteran rag trader Jeff Moss recently explained to SmartCompany, the rationalisation of companies in the textile, clothing and footwear sector over the last two decades has reached a point where it’s not easy to find good quality, reliable suppliers. Australia’s more entrepreneurial fashion operators have spotted an opportunity.
Slavinskis nominates Britain as a key target market, partly because it is a relatively easy (no language barrier and a very similar legal system) and partly because it provides good access to Europe.
“Most of my clients are getting their manufacturing done in China and then exporting straight into Britain from there. The higher price point stuff is particularly doing well.”
Like Australia, many areas of Latin America have come through the global financial crisis in relatively good shape. Brazil in particular is leading the region out of recession, with the OECD predicting economic growth of 4% in 2010.
“Brazil in particular has got through the crisis a bit better than a lot of other countries,” Tim Harcourt says.
He says there are export opportunities across a range of sectors, including agribusiness, biofuels, education, tourism and mining services. Infrastructure also remains a huge area of opportunity in the region, where roads, ports, utilities and other transport infrastructure remains underdeveloped.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
