By Leon Gettler >>

IRISH companies are expanding into new markets including Australia because of the ‘Irish advantage’ according to Kevin Sherry, the executive director of global business development for Enterprise Ireland.

He said international companies see three things in Irish businesses. The first is the skills and adaptability of its workforce, coming out as number one in productivity. The second is the focus on innovation. And the third is the trust that comes from being able to deliver.

“While we are a small country, just five million people, a fifth the size of Australia, we punch well above our weight,” Mr Sherry told Talking Business.

He said Enterprise Ireland, a government agency, had set up technology centres in such areas as big data, risk and compliance and life sciences, with the technology road map set by industry. 

He said Enterprise Ireland helped Irish companies start and expand into international markets. Enterprise Ireland was the world’s third largest seed investor.

“We’re in there from the ground floor with these companies to help them develop and build a team, to invest in new technology and spin out technology from research centres and there’s a very heavy government investment in that area,” Mr Sherry said.

The result: Ireland’s GDP is above 4 percent.

AUSTRALIA IMPORTANT

Mr Sherry said Australia was a really important market for Ireland and a number of Irish companies had built their footprints here.

“What we’re seeing is companies putting footprints here and creating jobs in Ireland and jobs in Australia,” he said.

Mr Sherry said Enterprise Ireland had been preparing for Brexit for the last two and a half years.

“With Enterprise Ireland we focus on a no-regrets strategy, that is, the things you can control that are within the company’s grasp and those things for us are helping companies with their competitiveness – and to continue to innovate and develop new products and services – and also expanding their reach and getting into new markets to lessen dependence on the UK,” Mr Sherry said.

He said with all the uncertainty around Brexit, Irish companies had responded really well and were building connections with other markets.

Despite that, the UK would continue to be an important market for Ireland and Irish companies, he said.

“Regardless of what happens with Brexit, they are our near neighbours and they’re a very important trading partner and valued customers and friends of Ireland and Irish companies,” Mr Sherry said.

“We will continue to trade with the UK, albeit with some businesses and sectors, the business model will have to be different.

“If there is no deal, then obviously… in some sectors, that will have a significant impact.” 

www.leongettler.com

Hear the complete interview and catch up with other topical business news on Leon Gettler’s Talking Business podcast, released every Friday at www.acast.com/talkingbusiness.

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NEGOTIATIONS between Australia and Hong Kong on a Free Trade Agreement (FTA) are looking to permanently lock in zero tariffs on agriculture exports to Hong Kong

This is the type of outcome Australian meat, livestock, seafood and wine producers have been hoping for. Minister for Agriculture David Littleproud said the Australia–Hong Kong FTA would lock in those zero tariffs and support a $1.4 billion agricultural trade relationship.

“The Coalition Government is delivering new markets and better tariffs for our farmers,” Mr Littleproud said. “Zero tariffs for our agriculture exports to Hong Kong means we can keep exporting the high-quality produce we are known for.  

“Meat, livestock, seafood and wine are some of our most valuable exports and we can now provide certainty to these industries. 

“This FTA recognises our reputation as a supplier of clean, green world-class produce. It is also proof of the strong agricultural relationship between Hong Kong and Australia,” he said.

“Hong Kong is also a major gateway to the rest of East Asia and gives our farmers a way to tap into other markets.”

Mr Littleproud said Australian agriculture continued to benefit from FTAs signed with China (ChAFTA), Korea (KAFTA), Japan (JAEPA) and Peru (PAFTA) and will be a key beneficiary from the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (TPP-11).

www.agriculture.com.au

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AUSTRALIAN defence industry manufacturer Austal will build two more warships for the United States Navy.

Austal will build two additional Independence-class Littoral Combat Ships for the US Navy, following through on eight ships already delivered.

The vessels, which were designed at Austal’s Centre for Excellence in Maritime Design in Henderson, Western Australia, will be the 16th and 17th ships in the class for the US Navy. 

“This is an outstanding success and comes after Austal won the contract to build 21 Guardian Class Pacific Patrol Boats in WA,” Minister for Defence, Christopher Pyne said.

“The patrol boats will be delivered to Pacific nations as part of our Pacific Maritime Security Program.”

Acknowledging Austal’s success, Minister Ciobo said he hoped to see even more Australian companies achieving export success.

“Through the Defence Export Strategy we want to become a top 10 defence exporter and I encourage other Australian companies to get in touch with the Defence Export Office to find out what support is available to them,” said Minister for Defence Industry, Steven Ciobo.

The contract award follows an announcement by the Government of Trinidad and Tobago in July 2018 that it would purchase two Austal Cape Class Patrol Boats.

Austal has also delivered Cape Class Patrol Boats to the Australian Border Force and Royal Australian Navy.

Mr Ciobo said all defence exports “continued to be subjected to Australia’s rigorous export control regulations’.

www.defence.gov.au

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By Patrick McCarthy >>

TURN ON THE NEWS, and the controversy is scarcely avoidable: Everyone, it seems, has an opinion on tariffs.

Proponents say they’re a necessary corrective to existing policies that, by protecting markets in one country, unfairly harm those in another. Opponents say that, even as a countermeasure, tariffs worsen the problem they purport to solve, by raising prices, hobbling industry and destroying jobs.

In one of the most famous examples, the United States in 1930 raised tariffs on 20,000 imported goods, triggering retaliatory duties from other countries. In the ensuing trade war, US exports and imports fell by more than half, exacerbating the Great Depression. 

This year, the US implemented tariffs on thousands of imported goods from China, triggering an immediate retaliation with taxes implemented against a similar amount of imports from the US.

Although Australia is exempt from these tariffs, it threatens Australia’s role in the supply chain for those imports while presenting significant volatility in global trade policy. Local businesses with global operations must assess their supply chains and develop strategies to ensure they can be nimble to further political disruption. 

With the advent of digital procurement networks, businesses can soften the financial blow associated with tariffs — and sometimes avoid it altogether. By opening up visibility into the interconnected operations of millions of buyers and suppliers, digital networks enable businesses to anticipate bottlenecks in the supply chain — whether caused by tariffs, weather, labour unrest or even war — and work around them long before they dent an income statement.

This newfound transparency also helps to gauge other risk factors ranging from financial and operational to legal and reputational. Aided by artificial intelligence, cloud-based networks help businesses to assemble — and, when necessary, reassemble — the most efficient, cost-effective, risk-managed supply chain possible out of countless permutations and combinations.

In many cases, a digital network can help to navigate a trade barrier by proposing alternate sources that satisfy all of a business’ requirements yet may have been previously unknown.

While certain direct materials, such as the rare-earth metals used to manufacture smartphones, originate almost exclusively from a particular part of the world, most derive from multiple sources and benefit from cross-border competition. By providing access to alternate sources, digital networks effectively lower the barriers imposed by tariffs — barriers that many businesses of an earlier era would have found insurmountable.

At a time when trade wars can gather pace almost as suddenly as a typhoon or tornado, businesses need to ensure their supply chain remains nimble ahead of any eventuality.

Only a cloud-based procurement network can draw meaningful, instantaneous insights out of the sprawling troves of operational data that trading partners rely on to forecast shifts in the supply chain.

In fact, digital networks extend the competitive advantage of their participants amid times of relative tension or calm in global trade. That’s because tariffs, while challenging for policymakers and procurement professionals alike, are temporary.

The uncertainty they evoke, just as other risk factors do, is ever-present. Managing that uncertainty is where procurement leaders lend greatest expertise to their organisations.

Patrick McCarthy is senior vice president and general manager of SAP Ariba, regarded as the world’s largest business network, linking together buyers and suppliers from 3.4 million companies in 190 countries.