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ALPHA Fund   Background Australia   Global Benchmark Report 2010   Australian Trade Commission
 

ALPHA Fund Background Australia Global Benchmark Report 2010 Australian Trade Commission

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    ALPHA Fund   Background Australia   Global Benchmark Report 2010   Australian Trade Commission ALPHA Fund Background Australia Global Benchmark Report 2010 Australian Trade Commission Document Transcript

    • AustraliaA Global FinancialServices CentreBenchmark Report 2010
    • AUSTRALIAA Global Financial Services CentreAustralia has emerged from the Global Financial Crisiswith its standing as a financial centre in the regionenhanced.Australia weathered the worst of the global financial crisis. Australia’s financial sectorremains in robust good health, underpinned by a world best practice regulatory system.The World Economic Forum’s Financial Development Report 2009 has also rankedAustralia second out of 55 of the world’s leading financial systems and capital markets. ABN 11 764 698 227Australia is home to the world’s fourth largest pool of contestable funds under Date: September 2010management, which is also the largest in the region. The funds management sector has ISBN: 978-0-9807059-3-5grown five-fold since 1995, at a compound annual growth rate of 12 per cent, and nowhas A$ 1.7 trillion in funds under management. DISCLAIMER This report has been prepared as a general overview. It is not intended to provide an exhaustive coverageAustralia’s impressive record of sustained economic and employment growth is of the topic. The information is made available on theexpected to continue. The IMF forecasts Australian economic growth of 3.0 per cent in understanding that the Australian Trade Commission2010 and 3.5 per cent for 2011. This compares favourably with those of other advanced (Austrade) is not providing professional advice. Therefore, while all care has been taken in theeconomies. Australia’s unemployment rate is also relatively low at 5.3 per cent. preparation of this report, Austrade does not acceptThe 2010 IMD World Competitiveness Yearbook has rated Australia’s economy as the responsibility for any losses suffered by persons relyingsecond most resilient in the world. on the information contained in this report or arising from any error or omission in the report. Any person relying on this information does so entirely at theirThese core economic strengths, our robust institutional framework, the openness of own discretion and Austrade strongly recommends theour economy and the size, depth and sophistication of our markets will underpin the reader obtain independent professional advice prior to acting on this information.future growth of the financial services sector. Austrade’s role includes to facilitate engagement byThe Australian Government has continued to take important steps to support the Australian financial services exporters in markets outside Australia. Austrade is not a promoter of anyinternationalisation of the financial sector and to enhance Australia’s attractiveness financial services products or investments and doesas a global financial services centre. not provide investment advice. Austrade assumes no responsibility for any company, product or service mentioned in this document, for any materials provided in relation to such products, nor for any act or omission of any business connected with such products. Investors should always consider whether an investment is appropriate for their needs and seek out independent advice as appropriate.
    • SECTION 1 Strong Economy Australia’s performance through the Global World’s 20 Largest Economies 2 Financial Crisis confirms its standing as one Real GDP Growth by Country 3 of the world’s most resilient economies. Resilience of the Economy to Economic Cycles 4 Unemployment Rates by Country 5 Australia’s Real Gross Value Added by Industry 6 Australia’s Real Gross Value Added – Growth by Industry 7 Gross Fixed Capital Formation as a Percentage of GDP 8 Inward Foreign Direct Investment Stocks by Country 9 Australia’s Exports of Goods and Services 10 Australia’s Exports of Education Services 11 The Prosperity Index – World Ranking by Country 12 Net Government Debt 13 Percentage of Nonperforming Bank Loans to Total Bank Loans 14 StrongEconomy
    • World’s 20 Largest Economies – 2010FPercentage share of total world nominal GDP in US$ Rest of World 19.17% 14. Mexico 1.61% 15. South Korea 1.60% 16. Netherlands 1.29% 1. USA 23.96% 17. Turkey 1.15% 18. Indonesia 1.09% 19. Switzerland 0.87% 20. Belgium 0.78% 8.39% 13. Australia 1.93% 2. China 8.69% 12. India 2.21% 11. Spain 2.31% 3. Japan 8.54% 10. Russia 2.44% 9. Canada 2.52% 8. Brazil 3.09% 7. Italy 3.43% 4. Germany 5.40% 6. UK 3.60% 5. France 4.32%GDP of the world’s 183 economies: US$61,767 billionGDP of Asia Pacific Economic Cooperation’s 21 member economies: US$34,483 billion (55.83%)F = ForecastSources: International Monetary Fund, World Economic Outlook Database, April 2010; AustradeAlthough Australia’s population is less than half a per cent of the global total, its economy ranks the 13th largest in the world, rivalling countries such asIndia, South Korea and Netherlands. Australia’s GDP is now estimated at around US$1.2 trillion, the fourth largest economy in the Asia-Pacific region. Section 1. Strong Economy 2
    • Real GDP Growth by Country – 2002 to 2010F Average Growth Rate Country 1998 to 2010 2002 2003 2004 2005 2006 2007 2008 2009 2010F China 9.7 9.1 10.0 10.1 10.4 11.6 13.0 9.6 9.1 10.5 India 7.0 4.6 6.9 7.9 9.2 9.8 9.4 6.4 5.7 9.4 Vietnam 6.9 7.1 7.3 7.8 8.4 8.2 8.5 6.2 5.3 6.5 UAE 5.4 2.6 11.9 9.7 8.2 8.7 6.1 5.1 -0.7 1.3 Singapore 5.0 4.2 3.8 9.2 7.6 8.7 8.2 1.4 -1.3 9.9 Korea 4.2 7.2 2.8 4.6 4.0 5.2 5.1 2.3 0.2 5.7 Philippines 4.2 4.4 4.9 6.4 5.0 5.3 7.1 3.8 1.1 6.0 Malaysia 4.1 5.4 5.8 6.8 5.3 5.8 6.2 4.6 -1.7 6.7 Taiwan 4.0 5.3 3.7 6.2 4.7 5.4 6.0 0.7 -1.9 7.7 Indonesia 3.5 4.5 4.8 5.0 5.7 5.5 6.3 6.0 4.5 6.0 Hong Kong 3.4 1.8 3.0 8.5 7.1 7.0 6.4 2.1 -2.8 6.0 Australia 3.3 3.9 3.2 3.6 3.2 2.6 4.7 2.4 1.3 3.0 Thailand 3.2 5.3 7.1 6.3 4.6 5.1 4.9 2.5 -2.2 7.0 Brazil 3.1 2.7 1.1 5.7 3.2 4.0 6.1 5.1 -0.2 7.1 Greece 3.0 3.4 5.9 4.6 2.2 4.5 4.5 2.0 -2.0 -2.0 Spain 2.7 2.7 3.1 3.3 3.6 4.0 3.6 0.9 -3.6 -0.4 Canada 2.7 2.9 1.9 3.1 3.0 2.9 2.5 0.5 -2.5 3.6 New Zealand 2.5 4.9 4.2 4.4 3.2 1.0 2.8 -0.1 -1.6 3.0 USA 2.4 1.8 2.5 3.6 3.1 2.7 2.1 0.4 -2.4 3.3 UK 2.0 2.1 2.8 3.0 2.2 2.9 2.6 0.5 -4.9 1.2 Netherlands 2.0 0.1 0.3 2.2 2.0 3.4 3.6 2.0 -4.0 1.3 Switzerland 1.8 0.4 -0.2 2.5 2.6 3.6 3.6 1.8 -1.5 1.5 France 1.7 1.1 1.1 2.3 1.9 2.4 2.3 0.1 -2.5 1.4 Germany 1.0 0.0 -0.2 1.2 0.7 3.2 2.5 1.2 -4.9 1.4 Italy 0.7 0.5 0.0 1.5 0.7 2.0 1.5 -1.3 -5.0 0.9 Japan 0.6 0.3 1.4 2.7 1.9 2.0 2.4 -1.2 -5.2 2.4 World Average1 2.6 2.0 2.7 4.0 3.4 3.9 3.9 1.8 -2.0 3.6F = Forecast; UAE = United Arab Emirates1. Based on market exchange ratesSources: International Monetary Fund, World Economic Outlook (WEO) Database, April 2009; WEO Update July 2009; AustradeIn the July 2010 Update of the International Monetary Fund’s (IMF) World Economic Outlook, the IMF has forecast that the Australian economy willgrow by 3.0 per cent in 2010 and 3.5 per cent in 2011, giving it a brighter outlook than that of the advanced economies as a whole. A timely response tothe financial crisis, a healthy banking sector, rigorous regulatory environment, flexible exchange rate and sustained demand from China for Australiancommodities helped to avoid the worst of the financial turbulence that other economies experienced. Section 1. Strong Economy 3
    • Resilience of the Economy to Economic Cycles – 2006 to 2010The higher the score the better1 Rank Country 2006 Score Country 2007 Score Country 2008 Score Country 2009 Score Country 2010 Score 1 Australia 7.39 Denmark 7.45 Australia 6.78 Qatar 6.16 Israel 7.13 2 USA 7.22 USA 6.90 Denmark 6.73 Norway 5.96 Australia 7.04 3 Denmark 7.16 Israel 6.82 Switzerland 6.43 Australia 5.83 India 6.82 4 Hong Kong 7.09 Austria 6.67 Israel 6.14 Chile 5.83 Qatar 6.82 5 India 6.84 Malaysia 6.64 Austria 6.00 Denmark 5.79 Malaysia 6.63 6 Israel 6.80 Switzerland 6.43 Norway 5.96 India 5.78 Chile 6.29 7 Ireland 6.68 Australia 6.38 Chile 5.89 Brazil 5.54 Switzerland 6.27 8 Norway 6.68 India 6.33 India 5.87 Israel 5.53 Norway 6.11 9 Chile 6.41 Hong Kong 6.33 Brazil 5.83 Switzerland 5.38 Taiwan 6.07 10 Canada 6.38 Singapore 6.19 Finland 5.80 China 5.05 China 6.02 11 Switzerland 6.34 China 6.17 Singapore 5.78 Malaysia 5.04 Poland 5.80 12 Malaysia 6.34 Norway 6.08 Sweden 5.66 Finland 5.00 Singapore 5.78 13 Japan 6.32 UK 6.02 Netherlands 5.66 Austria 4.98 Sweden 5.75 14 Qatar 6.31 Chile 6.00 Malaysia 5.66 Singapore 4.96 Indonesia 5.64 15 Singapore 6.30 Taiwan 5.79 Hong Kong 5.61 Hong Kong 4.94 South Korea 5.55 16 Estonia 6.19 Japan 5.79 Taiwan 5.52 Taiwan 4.91 Canada 5.55 17 Finland 6.02 Ireland 5.76 Czech Republic 5.41 South Africa 4.84 Brazil 5.51 18 Iceland 6.00 Luxembourg 5.73 Canada 5.36 Netherlands 4.83 Philippines 5.50 19 China 5.90 Estonia 5.72 Germany 5.34 Germany 4.79 Austria 5.46 20 Thailand 5.82 Netherlands 5.66 Slovenia 5.29 Sweden 4.77 Hong Kong 5.40 21 UK 5.82 Slovenia 5.66 USA 5.29 Philippines 4.73 Thailand 5.33 22 South Africa 5.75 Sweden 5.61 Estonia 5.27 Slovenia 4.63 Denmark 5.22 23 Sweden 5.72 Czech Republic 5.60 Jordan 5.15 Lithuania 4.60 Netherlands 5.20 24 Jordan 5.67 Jordan 5.50 China 5.15 Jordan 4.60 Germany 5.14 25 Taiwan 5.65 Iceland 5.44 Ireland 5.02 New Zealand 4.49 Turkey 4.87Surveyed question: Resilience of the economy to economic cycles is strong.1. IMD World Competitiveness Yearbook Executive Opinion Survey based on an index from 0 to 10. The IMD included 58 economies in the 2010 survey.Sources: IMD World Competitiveness Online 1995-2010 (Updated: May 2010); AustradeThe Australian economy has recorded 19 years of uninterrupted growth to 2010, despite two global downturns. The strength of the Australian economyis well recognised. The 2010 Institute for Management Development (IMD) World Competitiveness Yearbook rated Australia’s economy the second mostresilient in the world. For countries with populations greater than 20 million, Australia ranked first in 2009 and 2010, and has topped this category in eightof the previous nine years. Section 1. Strong Economy 4
    • Unemployment Rates by Country – 2007 to 2010 Unemployment Rate – Percentage of Labour Force Annual Latest Rate1 Country 2007 2008 2009 2010 Spain 8.3 11.3 18.0 20.1 Ireland 4.6 6.1 11.8 13.7 Turkey 10.3 11.0 14.1 12.0 Greece 8.3 7.7 9.5 11.7 Portugal 8.0 7.6 9.5 10.6 France 8.0 7.4 9.1 9.5 Sweden 6.0 6.2 8.3 9.5 USA 4.6 5.8 9.3 9.5 Belgium 7.5 7.0 7.9 8.6 Chile 7.1 7.8 10.8 8.5 Italy 5.9 6.7 7.8 8.4 Canada 6.0 6.1 8.3 8.0 UK 5.4 5.7 7.6 7.8 Germany 8.7 7.5 7.7 7.6 Brazil 9.3 7.9 8.1 7.0 Russia 6.1 6.4 8.4 6.8 New Zealand 3.7 4.2 6.1 6.8 Netherlands 4.5 3.9 4.9 5.5 Australia 4.4 4.2 5.6 5.3 Japan 3.9 4.0 5.1 5.3 China 4.0 4.2 4.3 4.2 South Korea 3.3 3.2 3.7 3.7 Switzerland 3.5 3.4 4.2 3.6 Norway 2.5 2.6 3.2 3.01. Latest unemployment rate for each country – annual rates not yet available.Sources: 2007 to 2009 data extracted on 18 August 2010 from OECD.Stat, and 2010 latest figures sourced from Bloomberg; AustradeAustralia’s unemployment rate has eased to just over 5 per cent after peaking at 5.8 per cent in the middle of 2009. Australia’s latest unemployment rateis almost half that of the Euro area and the United States. Australia is also ranked second globally in terms of economic resilience which in part reflectsthe openness of the economy and sustained economic reforms over recent decades. Over the past year, employment in Australia rose by a strong300,000. Section 1. Strong Economy 5
    • Australia’s Real Gross Value Added by Industry – 20101 Manufacturing 9.1% Finance/Insurance 10.8% Generated $A121 billion Mining 7.3% Professional/Scientific/ Technical Services 6.5% Agriculture/Forestry/Fishing 2.8% Healthcare/Social Assistance 6.3% Construction 7.5% Public Administration/Safety 5.5% Utilities 2.6% Transport/Postal/Warehousing 5.4% Other Services2 15.7% Wholesale Trade 4.9% Retail Trade 4.9% Information Media/Telecommunications 3.0% Education/Training 4.4% Rental/Hiring/Real Estate Services 3.3% Service Industries 80.8%1. Annual total to March 2010.2. Including Accommodation/Food Services, Administrative/Support Services, and Arts/Recreation Services.Sources: Australian Bureau of Statistics, cat. no. 5206.0, National Income, Expenditure and Product, Time Series Workbook (released 2 June 2010), Table 6; AustradeThe financial sector is the largest contributor to Australia’s national output, directly generating 10.8 per cent or A$121 billion of real gross value addedin 2010. This contribution is up from 8.9 per cent or A$53 billion two decades ago. Australia’s financial sector continues to grow more rapidly than mostother sectors of the economy, benefiting from significant structural reforms and strong and resilient economic growth over the past two decades.The financial services industry is a major driver of Australia’s economic growth, contributing almost four times that of agriculture, forestry and fishing(A$32 billion), and nearly 50 per cent more than mining (A$82 billion). The increasing significance of finance and insurance over the past two decadeshas also aided growth in related sectors such as information, media and telecommunications, and other business services. Section 1. Strong Economy 6
    • Australia’s Real Gross Value Added – Growth by Industry – 1999 to 20101 Construction 5.3 Administrative/Support Services 5.2Professional/Scientific/Technical Services 5.1 Financial/Insurance Services 4.7 Healthcare/Social Assistance 4.4 Retail Trade 4.1 Arts/Recreation Services 4.1 Information Media/Telecommunications 3.8 Transport/Postal/Warehousing 3.6 Agriculture/Forestry/Fishing 3.5 Wholesale Trade 3.1 Mining 2.7 Accommodation/Food Services 2.6 Public Administration/Safety 2.6 All Industry Average Growth: 3.3% Per Annum Rental/Hiring/Real Estate Services 2.2 Utilities 1.9 Education/Training 1.9 Manufacturing 0.9 0 1 2 3 4 5 6 7 Average Annual % Change1. Annual total to March each year.Sources: Australian Bureau of Statistics, cat. no. 5206.0, National Income, Expenditure and Product, Time Series Workbook, Table 6 (released 2 June 2010); AustradeAustralia’s finance and insurance sector has been one of the country’s highest performing industries, achieving an average annual growth rate of4.7 per cent a year between 1999 and 2010. This is well above the combined average for all industries (3.3 per cent) and reflects the strength ofAustralia’s service-based economy. Section 1. Strong Economy 7
    • Gross Fixed Capital Formation as a Percentage of GDP – 2008 29.4 29.3 28.8 30 24.9 24.2 23.9 25 23.1 22.7 22.6 22.2 22.1 22.1 21.9 21.8 21.7 21.7 21.3 20.9 21.1 20.9 20.9 20.8 20.6 20.6 20.4 19.9 19.5 19.4 19.3 20 19.0 17.9 16.8% of GDP 15 10 5 0 Switzerland EU27 total Austria Spain OECD total Czech Republic Poland Australia Iceland Luxembourg Finland Belgium Ireland Portugal France Netherlands Japan New Zealand Turkey Sweden Germany Denmark Greece Mexico Norway South Korea Canada Italy UK Slovak Republic Hungary USA Sources: OECD Factbook 2010: Economic, Environmental and Social Statistics (released 26 May 2010); AustradeThe share of total GDP devoted to investment in fixed assets is an important determinant of future economic growth. Higher capital investment tends toincrease productivity and contribute to higher GDP growth. Australia’s fixed capital investment as a percentage of GDP was 29.4 per cent in 2008, thehighest of all OECD countries. This rate is also well above the average of EU27 (21.1 per cent) and OECD (20.6 per cent). Section 1. Strong Economy 8
    • Inward Foreign Direct Investment Stocks by Country 1990 1995 2000 2005 2006 2007 2008 2009 2009 Country Inward FDI Stock as a Percentage of GDP (%) (US$ Billion) Switzerland 14.4 18.1 34.7 45.7 67.8 88.3 87.8 94.2 464 Netherlands 23.1 27.7 63.3 70.7 76.1 93.6 73.2 75.3 597 UK 20.6 17.6 30.4 36.9 46.7 44.4 36.8 51.7 1,125 Spain 12.7 17.5 26.9 34.0 37.4 40.6 39.1 45.9 671 France 7.9 12.2 29.4 41.5 48.8 48.6 32.3 42.8 1,133 Canada 19.4 20.9 29.3 30.1 29.3 36.3 29.5 39.3 525 Malaysia 23.4 32.3 56.2 32.2 34.3 41.2 33.1 39.0 75 Thailand 9.7 10.5 24.4 34.2 37.2 38.1 34.2 37.5 99 Australia 23.2 28.0 29.8 32.8 37.8 40.5 29.5 33.5 328 Brazil 8.5 6.2 19.0 20.6 20.3 22.7 17.6 25.5 401 USA 9.3 13.7 28.5 22.8 25.1 26.1 17.9 21.9 3,121 Germany 6.5 6.6 14.3 17.1 20.3 20.9 18.2 21.0 702 Russia – 1.4 12.4 23.6 27.0 38.2 12.7 20.3 252 Italy 5.3 5.8 11.0 12.6 15.8 17.2 14.8 18.6 394 Philippines 10.2 13.7 24.2 15.2 14.4 14.2 12.9 14.6 24 Greece 6.2 8.5 11.2 12.0 15.6 17.2 10.9 13.6 45 Indonesia 6.9 9.3 15.2 14.4 15.0 18.5 13.3 13.5 73 South Korea 2.0 1.8 7.1 12.4 12.5 11.4 10.2 13.3 111 India 0.5 1.5 3.5 5.1 7.5 8.8 9.6 12.9 164 Taiwan 5.9 5.7 6.0 11.8 13.3 12.4 11.3 12.7 48 China 5.1 13.4 16.2 12.2 11.0 9.7 8.7 10.1 473 Japan 0.3 0.6 1.1 2.2 2.5 3.0 4.2 3.9 200 World 9.8 11.4 23.3 25.4 29.1 32.5 25.4 30.7 17,743 Developed Economies 9.0 10.8 23.0 25.5 29.9 33.3 26.3 31.5 12,353 Developing Economies 13.6 14.6 25.0 25.2 26.9 30.0 24.4 29.1 4,893Sources: United Nations Conference in Trade and Development Database (www.unctad.org/fdistatistics), Annex Tables 7 and 3; AustradeAustralia’s Foreign Direct Investment (FDI) stocks rose almost 350 per cent to US$328 billion between 1990 and 2009. This represents a compoundannual growth rate of 8.2 per cent since 1990. As a percentage of GDP, FDI in Australia rose from 23.2 per cent in 1990 to 33.5 per cent in 2009. Section 1. Strong Economy 9
    • Australia’s Exports of Goods and Services (US$ Billion)1Financial year ending 30 June 240 43 Merchandise Goods Commercial Services 49 45 Compound Annual Growth Rate since 1990: 7.8% 200 39 188 176 172 160 31 144 US$ Billion 30 120 114 24 26 20 98 80 19 19 19 18 18 16 77 15 75 14 68 11 11 11 60 60 59 61 9 54 57 40 47 48 39 40 41 41 0 1991 2001 1995 2007 2003 2005 1997 2004 2006 2009 1994 1999 2002 1993 1998 1992 2010 1990 2008 1996 20001. Australia’s exports in A$ were converted to US$ values, using US$/A$ exchange rate at the end of June each year from the Reserve Bank of Australia Statistics.Sources: Australian Bureau of Statistics, cat. no. 5368.0, International Trade in Goods and Services, Australia, Table 1 (released 4 August 2010); AustradeAustralia’s annual export value of goods and services in US dollar terms fell 5.9 per cent to US$21 billion in 2009-10. Nevertheless, Australia has 7experienced strong export growth for 16 of the last 20 years, and export value has increased by a compound annual growth rate of around 8 per cent.The overall growth in the country’s external sector can be attributed to ongoing economic reform, Australia’s strong competitiveness, continued tradeopenness, and diversified export markets. Section 1. Strong Economy 10
    • Australia’s Exports of Education Services Share of 2009 Change 2007 2008 2009 Total 2008 to 09 (A$ Million) % Education Related Travel Services1 12,177 15,002 17,986 96.8 19.9 1. China 2,738 3,432 4,102 22.1 19.5 2. India 1,618 2,413 3,187 17.2 32.1 3. South Korea 964 1,082 1,117 6.0 3.2 4. Malaysia 670 756 856 4.6 13.2 5. Thailand 498 605 719 3.9 18.8 6. Vietnam 286 467 713 3.8 52.7 7. Nepal 173 380 614 3.3 61.6 8. Indonesia 487 525 576 3.1 9.7 9. Hong Kong 571 558 560 3.0 0.4 10. Brazil 268 365 425 2.3 16.4 Other countries 3,904 4,419 5,117 27.5 15.8 Other Educational Services2 383 495 556 3.0 12.3 Education Consultancy Services 132 124 115 0.6 -7.3 Correspondence Courses 22 25 24 0.1 -4.0 Services through Educational Institutions 104 203 250 1.3 23.2 Other Education Services 125 143 167 0.9 16.8 Royalties on Education Services 7 18 33 0.2 83.3 Total Education Related Services Exports 12,189 15,115 18,575 100.0 22.91. Includes international students on student visas only.2. Export income does not include income generated by the operations of offshore campuses of Australian institutions.Sources: Australian Education International, Research Snapshot, June 2009; AustradeInternational education activity contributed A$18.6 billion in export income to the Australian economy in 2009, up 22.9 per cent from 2008. Educationservices remain Australia’s fourth largest export, behind coal (A$39.4 billion), iron ore and concentrates (A$30.0 billion), and tourism (A$23.5 billion in2008-09). Of the total export income generated by education services, A$18 billion was from spending on fees and goods and services onshore byforeign students, with a further A$556 million from education consultancy and other services. Section 1. Strong Economy 11
    • The Prosperity Index1 – World Ranking by Country – 2009 1.0 0.922 0.920 0.919 0.908 0.917 0.895 0.893 0.892 0.880 0.885 0.875 0.854 0.9 0.828 0.805 0.793 0.767 0.764 0.8 0.729 0.720 0.723 0.697Scores (1 = the best, 0 = the worst) 0.7 0.581 0.569 0.546 0.6 0.547 0.537 0.501 0.473 0.5 0.422 0.420 0.4 0.3 0.2 0.1 0.0 Australia (6) Finland (1) Spain (19) Norway (5) Singapore (23) Philippines (55) Sweden (3) USA (9) China (75) Hong Kong (18) UAE (47) Switzerland (2) Netherlands (8) New Zealand (10) India (45) Ireland (11) Denmark (4) Japan (16) 7) Taiwan (24) South Korea (26) Indonesia (61) UK (12) Vietnam (77) Germany (14) Thailand (44) Italy (21) Canada (7) Malaysia (39) Brazil (41) France (11. The Prosperity Index ranks 104 nations according to nine building blocks of prosperity. A country’s position in the overall Prosperity Index is produced by equally weighting and averaging its nine sub-index scores. The scores are then ranked to produce the overall ranking. The Index measures prosperity across nine areas that have an established empirical relationship with either national wealth or wellbeing: economic fundamentals, entrepreneurship and innovation, democratic institutions, education, health, safety and security, governance, personal freedom, and social capital.Sources: The 2009 Legatum Prosperity Index Report; AustradeAustralia has been ranked sixth in the world and first in the Asia-Pacific region in the Legatum Institute’s 2009 Prosperity Index of more than 100countries. Countries were rated on the following: democratic institutions, economic fundamentals, education, entrepreneurship and innovation,governance, health, personal freedom, safety and security, and social capital. Australia achieved the following top ten rankings: personal freedom (4th),social capital (4th), democratic institutions (5th), education (6th), economic fundamentals (7th), and governance (10th). Section 1. Strong Economy 12
    • Net Government Debt (% of GDP) – 2010 140 121.6 116.0 120 100 91.1 82.2 77.2 80 74.5 71.6 % of GDP 68.6 66.2 60.5 57.5 60 47.8 46.0 40 39.2 32.2 20 5.4 3.3 3.1 0 Portugal2 Australia1 Spain2 France Netherlands Ireland Iceland Austria New Zealand Switzerland Canada Belgium Denmark USA Germany UK Japan Italy1. Does not reflect the latest federal government budget released 11 May 2010.2. Does not reflect additional deficit reduction plans announced 10 May 2010.Sources: IMF World Economic and Financial Surveys, Fiscal Monitor 14 May 2010, Table 3; AustradeAustralia’s net debt is estimated to be around 5 per cent of GDP, according to the IMF 2010 World Economic and Financial Surveys. The ratio is wellbelow the average of 69.9 per cent of GDP for advanced economies. The relatively low level of public sector debt reinforces Australia’s strong financialposition and sound economic credentials. Section 1. Strong Economy 13
    • Percentage of Nonperforming Bank Loans to Total Bank Loans – 2004 to 2009 2004 2005 2006 2007 2008 2009 Latest Average Thailand 11.9 9.1 8.4 7.9 5.7 NA Dec 8.6 Philippines1 14.4 10.0 7.5 5.8 4.5 4.6 Sep 7.8 Malaysia 11.7 9.6 8.5 6.5 4.8 3.8 Nov 7.5 China2 13.2 8.6 7.1 6.2 2.4 1.6 Dec 6.5 UAE3 12.5 8.3 6.3 2.9 2.5 4.6 Nov 6.2 Greece 7.0 6.3 5.4 4.5 5.0 7.2 Sep 5.9 Italy4 6.6 5.3 4.9 4.6 4.9 6.2 Jun 5.4 Indonesia5 4.5 7.6 6.1 4.1 3.2 3.8 Sep 4.9 India6 7.2 5.2 3.3 2.5 2.4 2.4 Mar 3.8 Germany 4.9 4.0 3.4 2.6 2.8 NA Dec 3.5 Brazil 2.9 3.5 3.5 3.0 3.1 4.5 Oct 3.4 France7 4.2 3.5 3.0 2.7 2.8 NA Dec 3.2 Singapore 5.0 3.8 2.8 1.5 1.7 2.3 Sep 2.9 Ireland8 0.8 0.7 0.7 0.8 2.6 7.5 Sep 2.2 USA9 0.8 0.7 0.8 1.4 2.9 5.4 Dec 2.0 Spain10 0.8 0.8 0.7 0.9 3.4 5.1 Dec 2.0 Japan11 2.9 1.8 1.5 1.4 1.6 1.8 Sep 1.8 Portugal12 2.0 1.5 1.3 1.5 1.9 2.8 Jun 1.8 UK 1.9 1.0 0.9 0.9 1.6 3.3 Jun 1.6 Hong Kong13 2.3 1.4 1.1 0.8 1.2 1.5 Sep 1.4 South Korea13 1.9 1.2 0.8 0.7 1.1 1.5 Sep 1.2 Netherlands 1.5 1.2 0.8 NA NA NA Dec 1.2 Canada 0.7 0.5 0.4 0.7 1.1 1.2 Sep 0.8 Switzerland 0.9 0.5 0.3 0.3 0.5 NA Dec 0.5 Australia14 0.2 0.2 0.2 0.2 0.8 1.1 Sep 0.5Note: Due to differences in national accounting, taxation, and supervisory regimes, the data is not strictly comparable across countries.1. The data excludes interbank loans. 2. Break in 2005; data started to cover all commercial banks. Previous years data covered “major commercial banks” (comprisingstate-owned commercial banks and joint stock commercial banks). 3. Data for national banks only. 4. Exposure to borrowers in a state of insolvency (even when not recog-nized in the court of law) plus exposure to borrowers in a temporary situation of difficulty. 5. Commercial banks. 6. Unless otherwise indicated, data refers to the end of thefiscal year, i.e., March of the indicated calendar year. 7. Gross doubtful debts. Break in series in 2006. 8. Covers all licensed banks (49 as of Q3 2009). 9. All FDIC-insuredinstitutions. 10. Doubtful exposures to other resident sectors over total lending to other resident sectors. 11. Unless otherwise indicated, data refers to the end of the fiscalyear, i.e., March of the next calendar year; for major banks. 12. For 2005-06 the figures are for the sample of institutions that are already complying with IFRS, accounting asof December 2004 for about 87 per cent of the usual aggregate considered. From 2007 onward, the sample of banking institutions under analysis was expanded to includethe institutions that adopted IFRS in 2006; On a consolidated basis. Nonperforming loans are defined as credit to customers overdue. Data for 2008 is preliminary. 13. Loansclassified as substandard, doubtful, and loss. 14. Impaired assets to total assets. Figures exclude loans in arrears that are covered by collateral.Sources: International Monetary Fund, Global Financial Stability Report, April 2010, Statistical Appendix, Table 24; Austrade.Australian banks have one of the lowest non-performing loans ratios of all 97 surveyed economies. Only 1.1 per cent of Australian bank loans are ‘non-performing’. This ratio reflects Australia’s strong financial system, sound regulatory framework and the resilience of the economy. Section 1. Strong Economy 14
    • SECTION 2Liquid MarketsAustralia’s financial markets are amongst Financial Development Index 2009 Global Ranking by Country 16 World’s 100 Largest Banks’ Credit Rating 17the largest, fastest growing and most Australia’s Financial Services Industry: Global Footprint 18sophisticated in Asia. Assets of Australia’s Financial Institutions 19 Global Significance of Australia’s Investment Fund Assets Pool 20 Australia’s Managed Funds Assets 21 Australian Investment Managers Asset Allocation 22 Global Pension Assets 23 World’s 25 Largest Sovereign Wealth Funds by 24 Assets Under Management Size of Key Stock Markets in the Asia-Pacific Region 25 International and Domestic Debt Securities 26 Real Estate Investment Trust Market Capitalisation 27 Asia-Pacific Hedge Fund Assets Under Management 28 Australian Residential Mortgage-Backed Security Issuance 29 World Insurance Markets 30 High Net Worth Individuals by Country 31 Worldwide Announced Mergers and Acquisitions by Target Nation 32 Liquid Markets
    • Financial Development Index 2009 Global Ranking by Country UK Australia USA Singapore Hong Kong Japan China India Overall Index (out of 55) 1 2 3 4 5 9 26 38 Financial Access 16 1 12 9 13 37 30 48 Non-Banking Financial Services 1 3 2 11 9 6 12 17 Banking Financial Services 2 5 20 11 1 3 10 39 Financial Markets 2 6 1 3 9 5 26 22 Financial Stability 37 9 38 5 3 34 23 46 Business Environment 12 11 10 2 9 15 40 48 Institutional Environment 15 14 11 1 10 17 35 48Sources: World Economic Forum, The Financial Development Report 2009 (released 8 October 2009); AustradeThe World Economic Forum’s The Financial Development Report 2009 has ranked Australia second of 55 of the world’s leading financial systems andcapital markets, ahead of the United States, Singapore and Hong Kong. Australia leads the Asia-Pacific region as a result of its solid performance inboth banking (5th in the world) and non-banking financial services (3rd in the world). The report stressed that the efficiency of Australia’s banks (a keycomponent of banking financial services) is a key strength. Section 2. Liquid Markets 16
    • World’s 100 Largest Banks’ Credit Rating 3,000 Australia’s four major banksAssets US$ Billion (as of 31 December 2009) 2,500 2,000 1,500 1,000 500 0 AAA AA AA- A+ A A- BBB+ BBB BBB- NR Sources: The chart was sourced from the Reserve Bank of Australia Financial Stability Report March 2009, page 25, Graph 38, and updated with the 2009 data of banks assets from The Banker 1000 World Banks 2010 and Standard and Poor’s Credit Ratings (downloaded 27 July 2010) from Bloomberg; Austrade Among the world’s 100 largest banks by assets, nine banks are rated AA or above – and four of these are Australian. Australian banks dealt with the Global Financial Crisis better than banks in many other countries. This can be attributed to Australia’s high prudential standards, and Australian banks focus on mainstream domestic activity and limited exposure to exotic derivatives. Section 2. Liquid Markets 17
    • Australia’s Financial Services Industry: Global Footprint 2010 UNITED KINGDOM CANADA IRELAND NETHERLANDS GERMANY LUXEMBOURG FRANCE SWITZERLAND MALTA SOUTH KOREA UNITED STATES OF AMERICA JAPAN UNITED ARAB EMIRATES CHINA OMAN INDIA TAIWAN HONG KONG CAYMAN ISLANDS THAILAND VIETNAM MALAYSIA PHILIPPINES SINGAPORE INDONESIA BRAZIL SAMOA FIJI SOUTH AFRICA NEW ZEALAND Banking Banking (Branch Office) Banking (Rep Office) ASIA PACIFIC EUROPE AFRICA & MIDDLE EAST AMERICAS Funds Management Property / Infrastructure Fund France South Africa China New Zealand Canada Financial Planning & Advisory Services Germany Africa Non-Specified Fiji Philippines Cayman Islands General Insurance Ireland Oman Hong Kong Singapore USA Health Insurance Luxembourg United Arab Emirates India Samoa Brazil Life Insurance Malta Middle East Non-Specified Indonesia Taiwan Non-Specified Investment Administration Netherlands Japan Thailand Mortgage Broking Services Switzerland Korea Vietnam Stock Broking Services United Kingdom Malaysia Non-SpecifiedSource: Based on survey responses from a sample of Financial Services Council membersAustralia’s financial services companies have rapidly expanded their operations around the globe. Australia has arguably the most efficient andcompetitive financial sector in the Asia-Pacific region. The range of Australia’s financial companies’ activities extends to North America, Europe andthroughout the Asia-Pacific region, and reflects Australia’s comparative strengths in funds management and investment banking. Section 2. Liquid Markets 18
    • Assets of Australia’s Financial Institutions (A$ Billion) 1995 to 2010 Authorised Deposit- Taking Institutions Funds Under Management (FUM) Other Collective Investment Investment Managers Financial (ADIs) Institutions (CIIs) Sourced from Institutions4 All Registered Life Offices Other Entities Financial Banks (other Other Financial and Managed Other than At the End of Systems (AFS)1 than RBA) ADIs2 Corporations Superannuation Funds3 Clls Overseas Total March 1995 914 431 26 91 229 55 29 6 47 March 2000 1,665 700 34 131 431 147 78 18 127 March 2005 2,900 1,324 48 163 636 235 191 34 270 March 2010 4,772 2,532 72 162 1,060 308 309 52 278 % of AFS Assets 100.0 53.1 1.5 3.4 22.2 6.5 6.5 1.1 5.8 % of GDP 376.3 199.7 5.7 12.7 83.6 24.3 24.3 4.1 21.9 CAGR % Since 1995 11.6 12.5 6.9 3.9 10.8 12.2 17.0 16.0 12.5RBA = Reserve Bank of Australia. CAGR = Compound annual growth rates.Note: The US$/A$ exchange rate was US$0.8523 as at 30 June 2010 (sourced from RBA statistics); the nominal value of Australia’s GDP in the year to31 March 2010 was A$1,268 billion.1. The sum may not add up due to rounding.2. The combined assets of building societies and credit unions.3. The combined assets of public unit trusts, cash management trusts, common funds and friendly societies.4. The combined assets of general insurance offices and securitisation vehicles.Sources: Reserve Bank of Australia Statistics, B01 Assets of Financial Institutions (downloaded 15 June 2010); Australian Bureau of Statistics, cat. no. 5206.0,National Income, Expenditure and Product, Times Series Workbook (released 2 June 2009), Table 3; AustradeAustralia’s large, expanding and mature financial services sector has assets of almost A$4.8 trillion, which is equivalent to around four times nominalGDP. This sector has benefited from almost two decades of stable economic growth, with favourable macroeconomic conditions and sound institutionalframeworks reflecting the benefits of wide ranging structural reforms and sound economic policies. Section 2. Liquid Markets 19
    • Global Significance of Australia’s Investment Fund Assets PoolInvestment Fund Assets1, US$, December Quarter 2009 $18bn $58bn $130bn $265bn $381bn Largest $661bn $861bn $870bn in Asia New Taiwan India South China Japan Singapore Hong Australia Zealand Korea Kong $1,979bn ASIA 2015 AUSTRALIA $1,199bn Australia’s $342bn Projected Growth Current $235bn Value 2000 $157bn 1995 1990 $11,121bn 4th Largest $1,806bn $2,294bn $565bn $661bn $729bn $784bn $861bn $861bn $870bn in the WorldCanada Japan UK Brazil Ireland Singapore Hong Kong Australia France Luxembourg USA GLOBALNote: Circles are not to scale. Data between countries is not strictly comparable.1. Refers to home-domiciled funds, except Hong Kong, South Korea and New Zealand, which include home- and foreign-domiciled funds. Fund of funds are not included. In this statistical release ‘investment fund’ refers to a publicly offered, open-end fund investing in transferable securities and money market funds. It is equivalent to ‘mutual fund’ in the US and ‘UCITS’ (Undertakings for the Collective Investment of Transferable Securities) in the European Fund and Asset Management Association‘s statistics on the European investment fund industry. Australia’s investment funds in the ICI survey only include consolidated assets of collective investment institutions.2. Standard & Poor’s Investment Consulting have assumed: A$1 = US$0.80.Sources: Investment Company Institute, Worldwide Mutual Fund Assets and Flows, December Quarter 2009; Hong Kong’s data, December 2009, sourced from Securities andFutures Commission, Fund Management Activities Survey 2009 (released July 2010); Singapore’s data sourced from the Monetary Authority of Singapore, 2009 SingaporeAsset Management Industry Survey; the projected figures of Australia’s investment fund assets were provided by Standard & Poor’s Investment Consulting; AustradeThe size of Australia’s investment fund assets pool and its prospects for substantial growth continue to attract global firms seeking to establish andexpand operations in Australia. The growth in assets has been sustained by the Australian Government’s mandatory retirement income scheme andfavourable tax treatment of superannuation. This, together with the ready availability of finance skills and expertise, strengthens Australia’s position as amajor funds management hub in the Asia-Pacific region. Section 2. Liquid Markets 20
    • Australia’s Managed Funds Assets (A$ Billion) – 1995 to 2010 FUNDS UNDER MANAGEMENT (FUM) TOTAL Collective Investment Institutions (CIIs) Consolidated Assets FUM of Investment Managers Sourced from Total Public Australian (less) other Superannuation Life Insurance Unit Entities other Investment Consolidated At the End of Funds Offices1 Trusts Other2 Total3 than Clls Overseas Managers Assets3 March 1995 119 110 36 19 284 29 6 0 319 March 2000 263 168 106 41 578 91 18 13 673 March 2005 448 187 186 48 870 251 34 60 1,095 March 2010 878 182 262 46 1,368 319 52 11 1,729 % of Total FUM 50.8 10.5 15.2 2.7 79.1 18.5 3.0 0.6 100.0 % of GDP 69.2 14.3 20.7 3.6 107.9 25.2 4.1 0.9 136.3 % CAGR Since 1995 14.2 3.4 14.1 6.2 11.1 17.3 16.0 N/A 11.9CAGR = Compound Annual Growth RateNote: The US$/A$ exchange rate was US$0.8523 as at 30 June 2010 (sourced from RBA statistics); the nominal value of Australia’s GDP in the year to 31 March 2010 wasA$1,268 billion.1. Figures include superannuation funds held in statutory funds for life insurance offices.2. The combined assets of cash management trusts, common funds and friendly societies.3. Total may not add up due to rounding.Sources: Australian Bureau of Statistics (ABS), cat. no. 5655.0 Managed Funds, Australia, Time Series Workbook (released 27 May 2010), Table 1. Managed Funds, Table8. Investment Managers; ABS, cat. no. 5206.0, National Income, Expenditure and Product, Times Series Workbook (released 2 June 2009), Table 3; AustradeTotal investment fund assets in Australia have increased more than five-fold since 1995, with a compound annual growth rate of 12 per cent.Consolidated assets under management are around A$1.7 trillion (US$1.5bn). Superannuation (pension) funds dominate the Australian investmentmanagement industry, representing around 50 per cent of the market. Since March 1995, superannuation funds under management have increasedby 14 per cent (compounded annually) to A$878 billion (US$750bn). The total market share of superannuation fund assets, including funds held byAustralia’s life insurance offices, represents more than 60 per cent of Australia’s total investment funds. Section 2. Liquid Markets 21
    • Australian Investment Managers Asset Allocation – % Share32 Australian Equity28 Overseas Equity & Fixed Interest2420 Other (including Cash, Currency/TAA)16 Australian Fixed Interest12 Property and Mortgage 8 4 Alternatives 0 Dec Mar Jun Sep Dec Mar Jun Sep Dec 07 08 08 08 08 09 09 09 09Source: Morningstar InvestorSupermarket, Market Wrap, December 2009, Data File, Worksheet 4; Austrade.The portfolio allocations of Australia’s investment managers continue to see significant exposures to global assets and to alternatives. Over 22 per centof fund manager assets are allocated to global markets, comprising 16.9 per cent to international shares and 5.7 per cent to international fixed interest in2009. Allocations to alternatives exceeded 5 per cent. Section 2. Liquid Markets 22
    • Global Pension Assets Total Assets Growth Rates (local currency) (US$ Billion) Market Share % As %of GDP 1-year % 10-year CAGR % End End End End End End (31/12/08- (31/12/99- Market 1999 2009e 1999 2009e 1999 2009e 31/12/09) 31/12/09) USA1 10,195 13,196 62.5 56.7 109 93 12.2 2.6 Japan 2,630 3,152 16.1 13.5 54 61 6.1 0.8 UK2 1,385 1,791 8.5 7.7 92 80 13.6 2.8 Canada 652 1,213 4.0 5.2 96 84 12.7 3.1 Australia 271 996 1.7 4.3 67 93 8.5 10.4 Netherlands 400 990 2.5 4.2 103 120 14.2 5.6 Switzerland 310 583 1.9 2.5 123 113 12.8 2.0 Germany 188 411 1.2 1.8 9 12 6.8 4.3 Brazil 70 392 0.4 1.7 12 22 54.3 18.3 South Africa 76 201 0.5 0.9 57 63 12.1 12.3 France 70 178 0.4 0.8 5 6 13.8 5.9 Ireland 49 102 0.3 0.4 54 43 12.2 3.8 Hong Kong 23 85 0.1 0.4 14 41 23.3 14.0 Total 16,318 23,290 100.0 100.0 76 70 15.6 6.61. Includes Individual Retirement Arrangements (IRAs)2. Excludes Personal and Stakeholder defined contribution (DC) assetsCAGR = Compound annual growth rates.e = Estimates.Sources: Towers Watson, 2010 Global Pension Asset Study January 2010; AustradeAustralia has the world’s fifth largest pension fund market, with total assets of around US$1 trillion under management. Australia has one of the mostdeveloped pension markets in the world, underpinned by its mandatory retirement income scheme. Section 2. Liquid Markets 23
    • World’s 25 Largest Sovereign Wealth Funds by Assets Under Management1 Rank Country Fund Name Assets (US$ Billion) 1 UAE – Abu Dhabi Abu Dhabi Investment Authority 627 2 Norway Government Pension Fund – Global 443 3 Saudi Arabia SAMA Foreign Holdings 415 4 China SAFE Investment Company2 347 5 China China Investment Corporation 289 6 Singapore Government of Singapore Investment Corporation 248 7 Hong Kong Hong Kong Monetary Authority Investment Portfolio 228 8 Kuwait Kuwait Investment Authority 203 9 China National Social Security Fund 147 10 Russia National Welfare Fund3 143 11 Singapore Temasek Holdings 133 12 Australia Future Fund, QIC and VFMC4 130 13 Libya Libyan Investment Authority 70 14 Qatar Qatar Investment Authority 65 15 Algeria Revenue Regulation Fund 55 16 Kazakhstan Kazakhstan National Fund 38 17 US – Alaska Alaska Permanent Fund 36 18 Ireland National Pensions Reserve Fund 33 19 South Korea Korea Investment Corporation 30 20 Brunei Brunei Investment Agency 30 21 France Strategic Investment Fund 28 22 Malaysia Khazanah Nasional 25 23 Iran Oil Stabilisation Fund 23 24 Chile Social and Economic Stabilization Fund 22 25 UAE – Dubai Investment Corporation of Dubai 201. All figures quoted are from official sources, or where the institutions concerned do not issue statistics of their assets, from other publicly available sources. Some of thesefigures are best estimates as market values change day to day. 2. This number is a best guess estimation. 3. This includes the oil stabilisation fund of Russia. 4. Australiannumber includes total assets under management of the Future Fund (US$59.1bn), Queensland Investment Corporation (QIC, A$51.6bn or US$44.0bn) and Victorian FundsManagement Corporation (VFMC, A$31.1bn or US$26.5bn). QIC has a number of funding sources with the majority sovereign in nature.Sources: Sovereign Wealth Fund Institute (Data updated June 2010); AustradeSovereign Wealth Funds (SWFs) have existed for decades, but their total size worldwide has increased dramatically over the past 10 years. Most of thegrowth has been the result of a surge in current account surpluses from exports of oil and other commodities, fiscal surpluses, accumulated publicsavings, large privatisation receipts or pension reserves. Australia’s SWFs, which include the Future Fund and State Government managed SWFs, areamong the largest in the world. Section 2. Liquid Markets 24
    • Size of Key Stock Markets in the Asia-Pacific Region Market Capitalisation of Floating Stocks (US$ Billion, 30 July 2010) 1,000 936 900 800 USA 12,206 Japan 2,495 700 647 UK 2,362 600 Canada 1,275 558 France 1,059US$ Billion 500 484 Switzerland 860 Germany 837 400 361 356 300 208 200 104 100 84 61 25 17 0 Australia China South Taiwan Hong India Singapore Malaysia Indonesia Thailand Philippines New Korea Kong Zealand Sources: Standard & Poor’s, Global Broad Market Index, July 2010; Austrade With 2,050 listed companies, the Australian stock market is currently the largest liquid stock market in the Asia Pacific ex-Japan at US$936 billion. The market capitalisation of floating stocks in Australia is more than double that of Hong Kong (US$361 billion) and more than four times larger than that of Singapore. Australia’s strong, liquid, transparent and efficient stock market further strengthens its position as a leading financial services centre. Section 2. Liquid Markets 25
    • International and Domestic Debt Securities – Amount Outstanding Residence of Issuer, US$ Billion 25 2,400 2,565 2,200 Domestic Securities (Dec 2009) International Securities (Mar 2010) 2,000 1,800 1,600 550 1,400US$ Billion USA 25,065 6,140 125 1,200 Japan 11,522 171 Germany 2,806 2,052 1,000 1,085 UK 1,559 3,665 800 874 France 3,156 1,814 30 Italy 3,688 1,098 600 Canada 1,300 578 603 400 5 25 52 47 200 8 116 22 37 218 100 98 183 180 55 10 30 0 China Australia South India Taiwan Malaysia Thailand Singapore Hong Indonesia Philippines New Korea Kong Zealand Sources: Bank for International Settlements, Quarterly Review, June 2010, Table 11 and Table 16A; Austrade Australia has US$1.4 trillion debt securities outstanding – the region’s second largest amount (ex Japan), and is a regional leader in the issuance of both international and domestic debt securities. Section 2. Liquid Markets 26
    • Real Estate Investment Trust (REIT) Market CapitalisationDecember 2009, US$ Billion USA 271.85 Australia 70.75 France 64.53 UK 37.18 Japan 29.43 Singapore 23.13 Canada 20.61 Netherlands 11.23 Hong Kong 9.52 Belgium 6.76 South Africa 3.40New Zealand 2.54 Turkey 1.89 Malaysia 1.54 Germany 0.71 South Korea 0.13 0 50 100 150 200 250 300 US$ BillionNote: Insufficient data for Germany, the Netherlands and TurkeySources: Ernst & Young, Global Real Estate Investment Trust Report 2010, Against All Odds, p.12; AustradeAustralia is recognised as having the world’s largest Real Estate Investment Trusts market outside the United States. Its total market capitalisation isestimated at more than US$70 billion, which is significantly larger than the total market capitalisation of the United Kingdom (US$37.2 billion) and morethan the combined value (US$63.8 billion) of Japan, Singapore, Hong Kong, Malaysia and South Korea. Section 2. Liquid Markets 27
    • Asia-Pacific Hedge Fund Assets Under ManagementDecember 2009, US$ Billion Other Asia3 $5.6 (4.2%) Japan $10.2 (7.7%) Hong Kong $31.1 (23.5%) UK1 $11.9 (9.0%) Singapore $17.6 (13.3%) Australia2 $29.3 (22.1%) USA1 $26.7 (20.2%)1. Deploying hedge fund strategies in Asian markets.2. Manager assets only, excluding fund of hedge funds and Australian investor allocations to offshore managers.3. Other countries deploying hedge fund strategies in Asian markets.Sources: Asiahedge; AustradeAustralia’s hedge fund assets under management reached US$29.3 billion in December 2009, the second largest market in the region. More than 80 percent of Australia’s hedge fund assets are deployed in markets outside the country – demonstrating the industry’s international sophistication. Section 2. Liquid Markets 28
    • Australian Residential Mortgage-Backed Security IssuanceFinancial year ending 30 June, A$ Billion 80 Domestic (non-AOFM) Offshore Purchases by AOFM 70 60 50A$ Billion 40 106 30 87 70 20 63 63 53 56 43 10 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010AOFM = The Australian Office of Financial Management, a specialised agency responsible for the management of Australian Government debt, the Government’s cashbalances and selected investments in financial assets.Sources: Reserve Bank of Australia; AustradeBetween June 2007 and March 2010 the Australian assets of residential mortgage-backed securities (RMBs) contracted 42 per cent, from A$204 billionto A$11 billion, as few primary issues were released and existing portfolios were in run-off. RMBS issuance reduced substantially following the on-set of 7the Global Financial Crisis because overseas sources of funding were no longer available. The primary market issuance of Australian RMBS reduced by89 per cent to $A7.8 billion in 2007-08. As global financial markets recover, the Australian market has begun to show signs of improvement and RMBSissuance recovered to A$12.4 billion in 2008-09, and rose again to A$16.6 billion in 2009-10. This will continue to be underpinned by the strength of theAustralian economy, improved residential property markets, the quality of mortgages and origination practices, and a robust institutional and regulatoryenvironment. Section 2. Liquid Markets 29
    • World Insurance Markets – 2009 Penetration: Density: World Premium Volume % Share of % of Per Capita Ranking1 Country US$ Billion World Market Country’s GDP US$ Americas 1 USA 1,239.7 28.03 8.0 3,710 9 Canada 98.8 2.43 7.4 2,944 15 Brazil 48.8 1.20 3.1 252 Europe 3 UK 309.2 7.61 12.9 4,579 4 France 283.1 6.96 10.3 4,269 5 Germany 238.4 5.86 7.0 2,878 6 Italy 169.4 4.17 7.8 2,729 8 Netherlands 108.1 2.66 13.6 6,555 11 Spain 82.8 2.04 5.7 1,802 16 Switzerland 48.5 1.19 9.8 6,258 17 Ireland 44.6 1.10 8.9 4,516 18 Belgium 40.5 1.00 8.0 3,494 Asia-Pacific 2 Japan 506.0 12.44 9.9 3,979 7 China 163.0 4.01 3.4 121 10 South Korea 92.0 2.26 10.4 1,890 12 India 65.1 1.60 5.2 54 13 Taiwan 63.6 1.57 16.8 2,752 14 Australia 60.3 1.48 6.4 2,833 24 Hong Kong 23.0 0.57 11.0 3,304 31 Singapore 14.2 0.35 6.8 2,558 33 Thailand 10.5 0.26 4.0 154 35 Malaysia 8.8 0.22 4.4 322 40 Indonesia 7.3 0.18 1.3 32 42 New Zealand 6.7 0.16 5.8 1,567 45 UAE 5.1 0.13 2.5 1,112 54 Philippines 2.4 0.06 1.5 26 Other Countries 328.6 10.52 NA NA World 4,066.1 100.00 7.0 5951. Countries are ranked by the US$ value of premium volume in 2009. NA = Not ApplicableSources: Swiss Re, Sigma No 2/2010, World Insurance in 2009, Tables III, VIII and IX; AustradeAustralia’s insurance market is the 14th largest in the world and the sixth largest in the Asia-Pacific region behind Japan, China, South Korea, India andTaiwan. The country’s mature, innovative and well-regulated insurance industry, together with its strong legal, accounting, education, human resource andIT capacities, underpin its position as a financial services hub in the region. Section 2. Liquid Markets 30
    • High Net Worth Individuals by Country 3,000 2,866 2008 2009 2,500 2,460Number of HNWIs (in thousands) 2,000 1,650 1,500 1,366 1,000 810 861 500 477 448 365 362 346 383 213 251 185 222 164 179 129 174 131 147 127 143 0 USA Japan Germany China UK France Canada Switzerland Italy Australia Brazil Spain 16.5% 20.8% 6.4% 31.0% 23.8% 10.8% 17.9% 19.7% 9.2% 34.4% 11.9% 12.5% HNWI Growth Rate % (2008-2009)1. High net worth individuals (HNWIs) are defined as those having investable assets of US$1 million or more, excluding primary residence, collectables and consumer durables.Sources: Capgemini/Merrill Lynch Wealth Management Bank of America Corporation, World Wealth Report 2010, page 6; Austrade The private banking industry in Australia has benefited from almost twenty years of sustained economic growth to become the third largest private wealth market in the Asia Pacific and the tenth largest in the world. In 2009, the HNWI population in Australia rose by 34.4 per cent to 1 73,600, making it the strongest rebound among the 12 countries with the largest numbers of HNWIs. Despite its relatively small population, Australia’s pool of affluent individuals is larger than that of Brazil (146,700), Russia (117,700), and India (126,700), and is 36 per cent of China’s total. Strategically, Australia offers a competitive regional location for providing wealth management services. Section 2. Liquid Markets 31
    • Worldwide Announced Mergers and Acquisitions by Target Nation 01 Jan 2010 – 30 Jun 2010 01 Jan 2010 – 30 Jun 2010 Target Region/ Rank Value Number of Deals Nation (US$ Billion) Market Share % No. Market Share % Worldwide1 1,065.0 100.0 19,230 100.0 Americas 523.4 49.1 5,595 29.1 USA 364.6 34.2 3,612 18.8 Canada 39.4 3.7 1,119 5.8 Mexico 47.1 4.4 113 0.6 Brazil 44.2 4.1 268 1.4 Chile 5.4 0.5 74 0.4 Western Europe 240.6 22.6 4,801 25.0 UK 70.2 6.6 1,179 6.1 Spain 36.0 3.4 453 2.4 France 26.9 2.5 619 3.2 Asia-Pacific2 231.5 21.7 6,121 31.8 Australasia 54.5 5.1 919 4.8 Australia 43.7 4.1 826 4.3 Papua New Guinea 8.8 0.8 5 0.0 Japan 31.5 3.0 1,114 5.8 North Asia 90.6 8.5 2,285 11.9 China 53.2 5.0 1,500 7.8 Hong Kong 23.5 2.2 350 1.8 South East Asia 25.3 2.4 1,168 6.1 Indonesia 6.1 0.6 258 1.3 Malaysia 5.8 0.5 348 1.8 South Asia 28.3 2.7 614 3.2 Central Asia 1.2 0.1 21 0.1 Other3 69.6 6.5 2,713 14.11. Totals are the sum of Americas, Western Europe, Asia-Pacific and others, and may not add up due to rounding.2. Includes Australasia, Japan, North Asia, South East Asia, South Asia and Central Asia. 3. Includes Eastern Europe, Middle East and Africa.Sources: Thomson Reuters, Mergers and Acquisitions Review, Financial Advisors, First Half 2010, Page 2; AustradeWorldwide Merger and Acquisition (M&A) activity has improved during the first half of 2010, as the global financial markets recover. The value ofworldwide M&A totalled US$1.1 trillion during the period, a 9.4 per cent increase from levels during the first half of 2009. In the first half of 2010,Australia’s volume in announced deals was US$44 billion. Excluding a single significant announced deal in first half 2009 (around US$58bn), Australia’svolume improved from US$32 billion. Overall, Australia’s M&A announced deals ranked the sixth largest in the world with a global market share of 4.1 percent, after the United States, the United Kingdom, China, Mexico and Brazil. Section 2. Liquid Markets 32
    • Image courtesy of I&I NSWSECTION 3Skilled WorkforceAustralia’s highly skilled and multilingual Employed Persons in Australia’s Financial and 34 Insurance Services Sectorworkforce ranks among the best in the world. Rising Productivity and Falling Labour Costs in Australia 35 Employed Persons in the Services Sector 36 Workforce Skill Base Comparisons 37 Selected Demographic Comparisons 38 Salary Survey of Financial Services Roles in Sydney 39 Australia’s Labour Force by Birthplace 40 Foreign-Born Labour Force as a Percentage of Labour Force 41 Finance and Insurance Employed Persons with 42 Post-school Qualifications Percentage of Employed Persons with Tertiary Education 43 by Industry Sector Tertiary-Level Graduates in Employment as a Percentage 44 of Total Employment International Students – Top 15 Source Countries and Fields 45 of Education Skilled Workforce
    • Employed Persons in Australia’s Financial and Insurance Services SectorTrend Terms 420 400 380 Number of employed persons (’000) 360 340 320 300 280 May 01 Nov 01 Nov 08 Nov 07 Nov 97 May 94 Nov 96 May 97 May 03 May 07 May 08 Nov 95 May 09 Nov 99 May 05 May 06 Nov 98 Nov 04 May 95 Nov 09 May 04 Nov 05 May 96 May 99 Nov 06 Nov 94 May 98 Nov 00 Nov 02 May 02 May 00 Nov 03 May 10Sources: Australian Bureau of Statistics, cat. no. 6291.0.55.003 - Labour Force, Australia, Detailed, Quarterly, May 2010 Table 04. Employed Persons by Industry (released17 June 2010); AustradeAustralia has 400,000 people employed in its large and expanding finance sector. This skilled, multilingual and relatively low cost workforce is one ofAustralia’s great strengths as a financial services centre in the Asian time zone. Excellent education and training facilities, a strong regulatory environment,sophisticated business infrastructure and a large skilled immigration intake enhance these workforce characteristics. Section 3. Skilled Workforce 34
    • Rising Productivity and Falling Labour Costs in Australia – 1994 to 2010Trend Terms 140 130 GDP per Hour Worked Market Sector Index 120Index (Sep 1994 = 100) 110 100 Real Unit of Labour Costs (Non-farm) Index 90 80 Mar-02 Sep-99 Mar-04 Sep-02 Mar-08 Sep-08 Mar-09 Sep-09 Mar-99 Mar-03 Mar-05 Sep-05 Mar-06 Sep-06 Sep-00 Sep-04 Mar-95 Sep-94 Mar-00 Sep-98 Mar-98 Mar-96 Sep-03 Sep-96 Sep-95 Mar-07 Sep-07 Mar-97 Mar-10 Sep-01 Sep-97 Mar-01Sources: Australian Bureau of Statistics, cat. no. 5206.0, Australian National Accounts: National Income, Expenditure and Product, Table 1. Key National AccountsAggregates, Time Series Workbook; AustradeAustralia has enjoyed strong and sustained labour productivity growth over the last two decades. This can, in part, be attributed to the country’s highlyeducated workforce, which is known for its strong work ethic and positive approach to change. In addition, real unit labour costs have fallen consistentlysince 2000. Section 3. Skilled Workforce 35
    • Employed Persons in the Services Sector – 2007Percentage of total civilian employment (OECD average: 70.1) 78.8 80 77.9 76.3 76.1 76.0 75.9 76.1 75.1 74.2 73.7 73.6 73.4 72.4 71.0 69.7 70 67.9 66.9 67.7 66.7 67.0 66.0 66.1 65.5 62.4 59.3 60 57.6 56.4 56.1 54.5 49.8 50 40 30 20 10 0 USA UK Netherlands Canada Belgium Denmark Iceland Switzerland New Zealand Finland Japan Germany Austria Spain Italy Hungary Mexico Sweden Norway Australia Ireland Greece Portugal Slovak Republic Czech Republic Poland Luxembourg France South Korea TurkeySources: Organisation for Economic Co-operation and Development, OECD in Figures 2009 Edition; AustradeAustralia’s economy is service-based, with over 75 per cent of the total workforce employed by the services sector. Other major economies with similarlevels of employment in services include the United States, the United Kingdom, France, Canada and the Netherlands. Section 3. Skilled Workforce 36
    • Workforce Skill Base Comparisons Australia China India Hong Kong Japan Singapore USA UK World Competitiveness Yearbook 2010 Rankinga in: Attracting and Retaining 3 16 8 23 13 2 10 39 University Education 7 49 22 23 36 1 10 28 Labour Productivity (PPP) 9 55 58 22 25 21 3 14 Management Education 18 46 13 27 40 2 8 29 Global Competitiveness Report 2009-10 Rankingb in: Secondary Enrolment Rate 1 89 107 73 24 17 43 36 Reliance on Professional Management 7 46 30 38 19 8 11 13 Quality of Scientific Research Institutions 10 35 25 34 15 12 2 4 Tertiary Enrolment Rate 13 80 100 66 32 29 6 30 UNDP’s Human Development Report 2009 Rankingc in: Human Development Index (HDI) 2 92 134 24 10 23 13 21Sources: (a) Institute for Management Development (IMD), Switzerland, IMD World Competitiveness Online 1995-2010 (Updated: May 2010, 58 economies); (b) WorldEconomic Forum, Switzerland and Harvard University, Global Competitiveness Report 2009-10 (133 economies); (c) The United Nations Development Programme(UNDP), Human Development Report 2009 (182 economies), Statistical Annex, Table H; AustradeInternational studies confirm the high skill level of Australia’s workforce, particularly for financial services. In many critical categories, such as UniversityEducation, Labour Productivity and Reliance on Professional Management, Australia’s workforce rates amongst the best in the world. This quality is animportant factor for global finance service firms deciding to set up or expand their operations in Australia and the Asia-Pacific region. Section 3. Skilled Workforce 37
    • Selected Demographic Comparisons1 – Mid Year 2009 (’000) Melbourne Sydney New York City London Hong Kong Singapore Population 3,996 4,504 8,364 7,754 7,004 4,988 Labour Force 2,114 2,379 3,994 4,052 3,695 3,030 Employed Persons – All Industries 1,979 2,223 3,609 3,676 3,504 2,906 Finance and Insurance 90 142 315 332 210 158 % of Total Employed Persons 4.5 6.4 8.7 9.0 6.0 5.4 Universities – Total Enrolled Students 179 251 446 426 102 53 % of Total Population 4.5 5.6 5.3 5.5 1.5 1.11. For New York City, the closest available figure for population, mid-2008 is used. The latest data available for students is from 2008. State-wide public and private institution students (studying in Australia) data was used for Sydney (New South Wales) and Melbourne (Victoria). For Singapore, data represents 2008 full-time enrolment. For London and Hong Kong, data represents 2008-09 academic year.Sources: AUSTRALIA: Australian Bureau of Statistics (ABS), cat. no. 3101.0, Australian Demographic Statistics, Dec 2009; ABS cat. no. 6291.0.55.001 Labour Force;ABS cat. no. 6291.0.55.003 E03_aug 94 – Employed Persons by Sex, Industry, Capital City-Balance of State, Hours Worked; Department of Education, Employment andWorkplace Relations; Austrade. USA: US Census Bureau, Population Division, Table 27: Incorporated Places over 100,000 or more Inhabitants in 2008 population; Stateof New York and U.S. Bureau of Labour Statistics, Quarterly Census of Employment and Wages; U.S. Department of Labour, Bureau of Labour Statistics, Status of theCivilian Labour Force. UK: Office of National Statistics (ONS), Statistical Bulletin, Population Estimates June 2010; ONS Time series Labour Market Statistics 18A RegionalLabour Market Summary; London Development Agency, Mayor of London, The Mayor’s Economic Development Strategy for London, Table 1: London Higher, HESA Factsheets, Student numbers in London 2008-09. HONG KONG: Census and Statistics Department, Hong Kong in Figures 2010 Edition, February 2010; Education Bureau.SINGAPORE: Ministry of Manpower (MOM), online Statistics, Labour Force; MOM Research and Statistics Department, Labour Market, Second Quarter 2009 Table 1.1;Statistics Singapore Ministry of Education, Education Factsheet 2009Australia has a larger population and labour force than that of Singapore and Hong Kong combined and there are significantly more people employedin financial services in Sydney and Melbourne combined than in either Singapore or Hong Kong. Similarly, there are many more students studying inuniversities in Australia than in other centres in the Asian time zone. Both Sydney and Melbourne have around five per cent of their population enrolled astertiary students, which is comparable to that of Greater London and New York City, and well above that of Hong Kong and Singapore. This student poolrepresents a pipeline of talent underpinning Australia’s strong, highly skilled, financial services labour force. Section 3. Skilled Workforce 38
    • Salary Survey of Financial Services Roles in Sydney – 2010 Role (Qualification) Experience From To Role (Qualification) Experience From To Banking and Financial Services (A$’000 Per Annum) Banking Operations (A$’000 Per Annum) Accounts Clerk 45 55 Corporate Actions Clerk 0-2 yrs 45 65 Assistant Accountant 45 65 Corporate Actions Manager 3-5 yrs 100 140 Business Analyst – CA/CPA 0-2 yrs 55 85 Derivatives Documentation Clerk 0-2 yrs 45 60 Business Analyst – CA/CPA 3-5 yrs 85 120 Derivatives Operations Manager 3-5 yrs 95 135 Financial Accountant – CA/CPA 0-2 yrs 55 75 Equities Clerk 0-2 yrs 45 60 Financial Accountant – CA/CPA 3-5 yrs 80 125 Equities Supervisor 3-5 yrs 75 100 Fund Accountant – CA/CPA 0-2 yrs 45 65 Fixed Income Clerk 0-2 yrs 45 60 Fund Accountant – CA/CPA 3-5 yrs 65 120 Fixed Income Operations Manager 6+yrs 120 160 Management Accountant – CA/CPA 0-2 yrs 50 75 Fund Administrator – Custody 0-2 yrs 40 55 Management Accountant – CA/CPA 3-5 yrs 80 120 Fund Administrator – Fund Management 0-2 yrs 40 55 Tax Accountant 0 -2 yrs 50 80 FX Clerk 0-2 yrs 45 55 Tax Accountant 3-5 yrs 80 120 FX Operations Manager 6+yrs 100 140 Legal – Financial Services1 Risk Management, Compliance and Audit Investment Banking 0-2 yrs 80 105 Compliance – Degree 0-2 yrs 55 80 Investment Banking 2-5 yrs 90 160 Compliance – Degree 3-5 yrs 80 120 Investment Banking 5-10 yrs 140 225 Credit Risk Analyst 0-2 yrs 55 80 Funds Management 0-2 yrs 65 100 Credit Risk Analyst 3-5 yrs 80 120 Funds Management 2 -5 yrs 90 150 Internal Auditor – CA/CPA 0-2 yrs 55 80 Funds Management 5-10 yrs 140 225 Internal Auditor – CA/CPA 3-5 yrs 80 120 Retail Banking 0-2 yrs 65 95 Market Risk – Degree 0-2 yrs 55 80 Retail Banking 2-5 yrs 90 150 Market Risk – Degree 3-5 yrs 90 140 Insurance 0-2 yrs 60 90 Operation Risks Manager 0-2 yrs 55 80 Insurance 2-5 yrs 75 140 Operation Risks Manager 3-5 yrs 80 120Figures above are basic salaries, inclusive of superannuation, but exclusive of benefits/bonuses, unless otherwise specified.Note: The US$/A$ exchange rate was US$0.8523 as of 30 June 2010 (sourced from Reserve Bank of Australia statistics).1. Post Qualification Experience.Sources: Robert Walters Salary Survey 2010, pages 186, 188, 198 and 200; AustradeSalary levels in Australia for skilled professionals are generally lower than those in comparable financial services centres around the world. The availabilityof a large, relatively low cost, highly skilled and multilingual domestic workforce reduces the need to import more expensive expatriates. In addition,expatriate remuneration in Australia is generally lower than in competing markets, including Tokyo, Hong Kong and Singapore. This reflects overall cost ofliving and quality of life considerations. Section 3. Skilled Workforce 39
    • Australia’s Labour Force by Birthplace – May 2010Total labour force as at May 2010: 11,664,100 Americas 1.3% North Africa & The Middle East 1.3% North West Europe 1.3% Sub-Saharan Africa 1.5% North East Asia 2.6% Southern & Eastern Europe 2.7% Southern & Central Asia 2.8% Australian Overseas Born Born 73.1% 26.9% Oceania & The Antarctic 3.7% South East Asia 3.8% UK & Ireland 6.0%Sources: Australian Bureau of Statistics, cat. no. 6105.0, Australian Labour Market Statistics, July 2010 (released 16 July 2010); AustradeMore than a quarter of Australia’s labour force (over 3.1 million), was born overseas, with substantial representation from European (1.2 million) and Asian(1.1 million) countries. This underlines Australia’s capacity to offer workforce solutions to those organisations requiring multilingual staff. Section 3. Skilled Workforce 40
    • Foreign-Born Labour Force as a Percentage of Labour Force – 2007 Luxembourg 46.5 Australia 25.8 Switzerland 25.4New Zealand 23.8 Canada 21.2 Spain 16.9 Austria 16.6 USA 16.3 Ireland 15.5 Sweden 13.8 Germany 13.6 UK 12.2 France 11.9 Netherlands 11.0 Belgium 10.9 Italy 9.1 Greece 8.7 Norway 8.3 Denmark 8.1 Portugal 8.0 Finland 3.1 South Korea1 2.1 Japan1 0.3 0 5 10 15 20 25 30 35 40 45 501. Foreign population instead of foreign-born population.Sources: Organisation for Economic Co-operation and Development, OECD in Figures 2009 Edition; AustradeAccording to OECD in Figures 2009, Australia’s overseas-born labour force as a percentage of total labour force (25.8 per cent) is ranked second afterLuxembourg among all OECD countries. Australia is the most culturally diverse country in the Asia-Pacific region and one of the most multiculturalcountries in the world. Section 3. Skilled Workforce 41
    • Finance and Insurance Employed Persons with Post-school Qualifications– May 2009Total employed persons in finance and insurance in Australia as at May 2009: 396,200 Postgraduate Degree 34,200 Graduate Diploma/ Graduate Certificate 9,700 Tertiary Qualifications 157,600 Bachelor Degree Other 113,700 136,800 Advanced Diploma/ Diploma Other 49,900 Post-school Qualifications 101,800 Certificate I, II, III & IV 51,900Sources: Australian Bureau of Statistics, cat. no. 6227.0, Education and Work, May 2009, page 19 (released 24 November 2009); AustradeAustralia’s financial services workforce is highly educated. In May 2009, around 65 per cent (or 259,400) of those employed in financial services had post-school qualifications ranging from vocational certificates through to postgraduate degree-level qualifications. Section 3. Skilled Workforce 42
    • Percentage of Employed Persons with Tertiary Education1 by Industry Sector– May 2009 Education/Training 62.0Professional/Scientific/Technical Services 54.9 Healthcare/Social Assistance 40.0 Financial/Insurance Services 39.8 Public Administration/Safety 39.0 Information Media/Telecommunications 38.4 Arts/Recreation Services 18.4 Electricity/Gas/Water/Waste Services 17.4 Mining 14.8 Rental/Hiring/Real Estate Services 13.9 Manufacturing 13.9 Administrative/Support Services 12.6 Transport/Postal/Warehousing 12.3 Wholesale Trade 11.9 Retail Trade 11.4 All Industry Average: 26.1% Accommodation/Food Services 10.4 Agriculture/Forestry/Fishing 9.3 Construction 6.2 0 10 20 30 40 50 60 701. In this statistical release, tertiary education refers to Bachelor Degree or higher.Sources: Australian Bureau of Statistics, cat. no. 6227.0, Education and Work, May 2009, page 19 (released 24 November 2009); AustradeThe finance and insurance industry is one of the country’s most educated sectors, with almost 40 per cent of people employed in the industry holding aBachelor Degree or higher. Section 3. Skilled Workforce 43
    • Tertiary-Level Graduates in Employment as a Percentageof Total Employment – 2007 24.7 52 Women Men 48 22.5 44 25.7 19.4 18.1 40 19.3 18.6 24.6 17.8 17.0 18.7 36 18.1 22.6 18.9 16.6 14.7 32 15.6 15.1 16.7Per Cent 16.8 28 15.3 27.3 10.6 24 10.5 22.7 12.2 21.9 21.7 20 19.7 11.1 18.8 18.6 19.1 18.9 9.0 8.3 17.1 17.1 17.8 6.5 9.1 16 16.4 15.8 15.9 10.4 15.5 14.1 13.5 12 12.6 11.9 11.3 12.2 11.6 9.3 8 8.2 8.4 8.5 7.0 6.6 4 4.7 0 USA UK Canada Japan New Zealand Finland Belgium Spain Switzerland Netherlands Denmark Iceland Germany Hungary Austria Mexico Italy Australia Ireland Norway Sweden Greece Poland Slovak Republic Portugal Czech Republic South Korea France Luxembourg TurkeySources: Organisation for Economic Co-operation and Development, Science, Technology and Industry Scoreboard 2009, Chapter 5; Austrade In addition to offering cultural and linguistic diversity, Australia’s 11 million-strong workforce is highly skilled and well-educated. Almost 38 per cent of those employed are tertiary-level graduates. This ratio is the seventh highest among 30 OECD countries, and above that of UK (35.8 per cent), France (31.0 per cent), Germany (28.1 per cent) and Italy (16.8 per cent). Section 3. Skilled Workforce 44
    • International Students1 – Top 15 Source Countries and Fields of Education– 2008 China Singapore Malaysia IndiaHong Kong Management and Commerce Indonesia Other Courses Vietnam USA North East Asia 66,281 37,087 South East Asia 47,591 45,556South Korea Other Regions 39,458 58,190 Sri Lanka All Regions – 2008 153,330 140,833 All Regions – 2007 140,600 132,499 Canada % Change 9.1 6.3 Thailand UAE Japan Taiwan 0 10,000 20,000 30,000 40,000 50,000 60,000 70,0001. Total number of onshore (223,508) and offshore students (70,655).Sources: Department of Education, Employment and Workplace Relations, Selected Higher Education Statistics 2008, Table 53 All Overseas Students by Country ofPermanent Home Residence and Broad Field of Education, Full Year 2008; AustradeAustralia is the ‘first choice’ education destination across the Asia-Pacific region, with around 300,000 overseas students now studying in Australia’stertiary institutions. Australia is now a hub for financial services education in the region, with over 50 per cent of overseas students in Australia studyingManagement and Commerce. Section 3. Skilled Workforce 45
    • SECTION 4Advanced InfrastructureAustralia’s technologically sophisticated and Global Prime Office Occupancy Costs 47competitively priced infrastructure adds to the Australia’s Businesses with Internet Access and Broadband 48 as Main Type of Internet Connectioncountry’s attractiveness. Asia-Pacific Financial Services ICT Spending 49 Economist Intelligence Unit Digital Economy Rankings 50 United Nations e-Government Survey 2010 51 – e-Participation Index Advanced Infrastructure
    • Global Prime Office Occupancy Costs1 – 2010 London West End 182.94 Hong Kong (Central) 153.20 Tokyo (Inner Central) 143.99 Mumbai 125.76 Paris Ile-de-France 113.23 London City 110.07 Dubai 108.92 São Paulo 100.00 New Delhi 96.90 Luxembourg City 81.84Hong Kong (Citywide) 80.27 Geneva 80.25 Milan 77.93 Abu Dhabi 72.71 Seoul 71.82 Frankfurt am Main 69.64 New York Midtown 64.51 Rome 63.45 Shanghai (Pudong) 60.14 Toronto (CBD) 59.86 Perth 59.29 Singapore 57.49 Sydney 53.29 Shanghai (Puxi) 52.96 Beijing 51.08 Ho Chi Minh City 48.56 Taipei 45.09 Brisbane 40.46 Melbourne 36.43 Bangalore 33.28 San Francisco 33.17 Adelaide 31.53 Los Angeles (CBD) 28.74 Manila 24.38 Bangkok 23.54 Jakarta 17.89 0 20 40 60 80 100 120 140 160 180 2001. Unless otherwise indicated, all data reflect office space in the central commercial district. The local rent data for American, European and Middle East markets is expressed in either gross or net terms depending on the prevailing local practice. All Asian markets are reported on a net floor basis, including all occupancy expenses. Prime gross effective rents are used for occupancy costs.Sources: CB Richard Ellis Global Research and Consulting, Global Office Rents, May 2010; AustradeThe cost of prime office space in Australia (using an average of all major cities) is among the most competitively priced in the world and comparesfavourably to other major regional and global financial services centres. The average cost of prime office space in Sydney is around 65 per cent lower thanthat of Hong Kong and Tokyo. Melbourne and Brisbane have even more competitively priced office costs, coming in at around 75 per cent less than rentalcosts in Hong Kong and Tokyo. Section 4. Advanced Infrastructure 47
    • Australia’s Businesses with Internet Access and Broadband as Main Type of Internet Connection1 – 2008-09 Financial/Insurance Services 100.0 Construction 100.0 Information Media/Telecommunications 99.2 Mining 98.7 Wholesale Trade 98.5 Other Services 98.0 Health Care/Social Assistance 97.9 Retail Trade 97.9Professional, Scientific/Technical Services 97.8 Accommodation/Food Services 97.5 Rental, Hiring/Real Estate Services 97.2 Manufacturing 97.2 Transport, Postal/Warehousing 97.0 Electricity, Gas, Water/Waste Services 96.0 Industry Average: 98.1 Arts/Recreation Services 95.8 Administrative/Support Services 95.6 93 94 95 96 97 98 99 100 Business with Internet access (%) 1. Estimated number of businesses in Australia was 713,000 in financial year 2008-09 (released 24 June, 2010); Austrade Sources: Australian Bureau of Statistics, cat. no. 8166.0 Summary of IT Use and Innovation in Australian Business, 2008–09; Austrade Australian finance companies are sophisticated users of ICT, which is driving productivity across the industry. Australian banks and finance firms continue to invest heavily in new technologies and applications, with 100 per cent of businesses having internet access and broadband as the main type of internet connection. Other sectors are also converting on this blanket level of coverage. Section 4. Advanced Infrastructure 48
    • Asia-Pacific Financial Services ICT Spending (US$ Million) Market Share CAGR % 2003 2004 2005 2006 2007 2008 2009 2010 2010 % Since 2003 Japan 22,350 25,232 24,620 26,175 25,986 27,597 28,827 30,006 41.4 4.3 China 6,191 8,834 10,211 12,408 14,197 16,651 18,965 20,990 28.9 19.1 Australia 3,754 4,434 4,576 4,934 5,298 5,574 5,795 6,035 8.3 7.0 South Korea 2,924 3,172 3,381 3,701 3,798 3,885 3,957 4,079 5.6 4.9 India 1,505 1,822 1,990 2,281 2,652 2,990 3,278 3,605 5.0 13.3 Taiwan 1,346 1,500 1,500 1,563 1,603 1,681 1,780 1,912 2.6 5.1 Singapore 912 1,022 1,042 1,154 1,200 1,268 1,322 1,386 1.9 6.2 Hong Kong 947 1,039 1,057 1,155 1,180 1,231 1,289 1,361 1.9 5.3 New Zealand 425 483 496 527 566 595 618 647 0.9 6.2 Malaysia 286 331 341 384 429 461 493 524 0.7 9.0 Thailand 219 273 301 359 399 431 464 501 0.7 12.5 Philippines 185 248 277 345 394 437 464 497 0.7 15.2 Indonesia 145 172 190 238 268 293 320 348 0.5 13.3 Vietnam 168 194 214 234 258 288 315 338 0.5 10.4 Pakistan 94 108 114 131 139 147 155 163 0.2 8.1 Bangladesh 53 59 62 65 71 78 85 92 0.1 8.2 Sri Lanka 37 45 48 59 63 68 73 79 0.1 11.5 Asia-Pacific 41,544 48,968 50,418 55,713 58,501 63,675 68,199 72,565 100.0 8.3CAGR = Compound Annual Growth Rate.Sources: World Information Technology and Services Alliance, Digital Planet 2008; AustradeAustralia’s financial services total ICT spending is the third largest in the Asia-Pacific region after Japan and China. Australia’s financial organisationscontinue to invest heavily in new technologies and applications. Total ICT spending is projected to exceed US$6 billion in 2010, with a regional marketshare of more than eight per cent. Section 4. Advanced Infrastructure 49
    • Economist Intelligence Unit Digital Economy Rankings – 20101 Social and Government Consumer Ranking Overall Business Cultural Legal Policy and and Business (Out of 70) Score Connectivity Environment Environment Environment Vision Adoption Category Weight 20% 15% 15% 10% 15% 25% 1 Sweden 8.49 8.20 8.13 8.53 8.25 8.90 8.75 2 Denmark 8.41 7.85 8.18 8.47 8.10 8.70 8.90 3 USA 8.41 7.35 7.85 9.00 8.70 9.25 8.60 4 Finland 8.36 8.00 8.30 8.47 8.35 8.00 8.85 5 Netherlands 8.36 8.05 8.05 8.07 8.45 8.25 9.00 6 Norway 8.24 7.95 7.95 8.00 8.30 8.05 8.90 7 Hong Kong 8.22 7.65 8.40 7.27 9.00 9.18 8.28 8 Singapore 8.22 7.35 8.63 7.33 8.70 9.13 8.48 9 Australia 8.21 7.35 8.24 8.53 8.50 8.85 8.18 10 New Zealand 8.07 6.80 8.17 8.60 8.45 8.50 8.29 11 Canada 8.05 7.15 8.33 7.87 7.95 8.75 8.35 12 Taiwan 7.99 7.00 7.95 8.40 8.15 8.55 8.15 13 South Korea 7.94 7.90 7.32 8.80 7.65 9.20 7.18 14 UK 7.89 7.65 7.40 7.73 8.10 8.55 8.00 16 Japan 7.85 7.70 7.16 7.80 7.43 8.75 8.04 18 Germany 7.80 7.60 7.82 8.00 8.05 7.40 7.98 20 France 7.67 6.80 7.54 7.60 7.85 8.20 8.10 27 Italy 6.92 6.45 6.32 7.60 8.45 6.55 6.88 32 UAE 6.25 6.80 7.27 5.47 5.10 6.20 6.18 36 Malaysia 5.93 4.35 7.36 5.47 6.88 6.65 5.80 49 Thailand 4.86 3.20 6.83 4.50 6.35 5.60 4.18 54 Philippines 4.47 2.60 6.35 4.27 4.85 5.20 4.38 56 China 4.28 2.65 6.36 5.40 5.20 4.60 3.11 58 India 4.11 2.15 6.27 4.67 5.60 5.10 2.88 65 Indonesia 3.60 2.60 6.04 3.60 4.20 3.88 2.551. The digital economy rankings model consists of over 100 separate quantitative and qualitative criteria, all but one of which are scored by the EIU’s regional analysts and editors, and organised into six primary categories. The 39 indicators and 82 sub-indicators are, in turn, weighted according to their assumed importance as influencing factors.Sources: Economist Intelligence Unit (EIU), Digital Economy Rankings 2010, Beyond E-readiness, Appendix 2: Category Scores (released June 2010); AustradeAustralia is one of the world’s most tech-savvy countries, with one of the fastest take-ups of new technology. Australia was ranked one of the top ten inthe world in the Economist Intelligence Unit’s Digital Economy Rankings 2010. Australia is a sophisticated market where ICT companies can successfullydevelop solutions with global applicability. The country is also the source of a number of distinctive technologies – especially in the areas of e-finance,e-health, and e-government. Section 4. Advanced Infrastructure 50
    • United Nations e-Government Survey 2010 – e-Participation Index Rank Country Index Value Rank Country Index Value Rank Country Index Value Rank Country Index Value 1 South Korea 1.000 26 Colombia 0.443 51 Belarus 0.243 76 Antigua & Barbuda 0.157 2 Australia 0.914 26 Ireland 0.443 51 Poland 0.243 76 Cameroon 0.157 3 Spain 0.829 28 Kyrgyzstan 0.429 53 Kenya 0.229 76 Congo 0.157 4 New Zealand 0.771 28 Mongolia 0.429 53 Kuwait 0.229 76 Ecuador 0.157 5 UK 0.771 30 Finland 0.414 55 Italy 0.214 76 Montenegro 0.157 6 Japan 0.757 30 Israel 0.414 55 Macedonia 0.214 76 Oman 0.157 7 USA 0.757 32 China 0.371 55 Turkey 0.214 82 Andorra 0.143 8 Canada 0.729 32 Mexico 0.371 58 Argentina 0.200 82 Grenada 0.143 9 Estonia 0.686 34 Chile 0.343 58 Bolivia 0.200 82 Sri Lanka 0.143 10 Singapore 0.686 34 Malta 0.343 58 Costa Rica 0.200 82 Venezuela 0.143 11 Bahrain 0.671 36 Guatemala 0.314 58 India 0.200 86 Albania 0.129 12 Malaysia 0.657 36 Hungary 0.314 58 Rep. of Moldova 0.200 86 Czech Republic 0.129 13 Denmark 0.643 36 Uzbekistan 0.314 58 Switzerland 0.200 86 Honduras 0.129 14 Germany 0.614 39 Bulgaria 0.300 64 Dominican Republic 0.186 86 Indonesia 0.129 15 France 0.600 39 Nicaragua 0.300 64 Philippines 0.186 86 Lao 0.129 16 Netherlands 0.600 39 Tunisia 0.300 64 Romania 0.186 86 Liechtenstein 0.129 17 Belgium 0.586 42 Brazil 0.286 64 South Africa 0.186 86 Morocco 0.129 18 Kazakhstan 0.557 42 Egypt 0.286 68 Azerbaijan 0.171 86 Qatar 0.129 19 Lithuania 0.529 42 Jordan 0.286 68 Brunei Darussalam 0.171 86 Russia 0.129 20 Slovenia 0.514 45 Latvia 0.271 68 Cape Verde 0.171 86 Trinidad & Tobago 0.129 21 Austria 0.500 45 Lebanon 0.271 68 Côte d’Ivoire 0.171 86 UAE 0.129 22 Norway 0.500 45 Portugal 0.271 68 Libya 0.171 97 Cambodia 0.114 23 Cyprus 0.486 48 Greece 0.257 68 Luxembourg 0.171 97 Cuba 0.114 24 Sweden 0.486 48 Ukraine 0.257 68 Pakistan 0.171 97 Mali 0.114 25 Croatia 0.457 48 Uruguay 0.257 68 Peru 0.171 97 Mauritania 0.114Sources: United Nations e-Government Survey 2010: Leveraging e-Government at a Time of Financial and Economic Crisis, Statistical Annex Page 124; AustradeAustralia ranks the second highest out of 1 countries in the e-Government Participation Index. The United Nations 2010 Survey found that citizens 79now benefit from more advanced e-service delivery, better access to information, more efficient government management and improved interactionswith governments, primarily as a result of increasing use by the public sector of information and communications technology. Section 4. Advanced Infrastructure 51
    • SECTION 5Stable EnvironmentAustralia is one of the most politically stable Risk of Political Instability 53countries in the world and provides a Index of Economic Freedom World Ranking 54regulatory climate that strongly supports Business Environment 55institutional growth. Global Real Estate Transparency Index 56 Key Indicators of Doing Business 57 Australia’s Financial Regulatory Framework 58 Stable Environment
    • Risk of Political Instability1The higher the score the better 2006 2007 2008 2009 2010 Rank Score Score Score Score Score 1 Finland 9.71 Austria 9.71 Luxembourg 9.64 Finland 9.90 Norway 9.36 2 Australia 9.68 Ireland 9.57 Switzerland 9.62 Australia 9.54 Luxembourg 9.25 3 Denmark 9.51 Luxembourg 9.55 Singapore 9.40 Denmark 9.49 Australia 9.24 4 Switzerland 9.44 Australia 9.47 Australia 9.38 Switzerland 9.33 Finland 9.20 5 Ireland 9.42 Denmark 9.44 Sweden 9.23 New Zealand 9.27 Denmark 9.11 6 Canada 9.32 Switzerland 9.30 Austria 9.20 Sweden 9.21 Austria 9.00 7 Luxembourg 9.30 New Zealand 9.30 Canada 9.09 Norway 9.07 Switzerland 8.93 8 Austria 9.25 Sweden 9.18 New Zealand 8.84 Luxembourg 9.02 Canada 8.90 9 Singapore 9.22 Finland 9.11 Iceland 8.83 Austria 8.98 Chile 8.86 10 Iceland 9.19 Singapore 9.08 Ireland 8.82 Chile 8.80 Singapore 8.78 11 France 9.11 Netherlands 8.95 Denmark 8.81 Singapore 8.64 Sweden 8.77 12 Chile 9.07 Germany 8.84 Netherlands 8.71 Netherlands 8.57 New Zealand 8.76 13 New Zealand 8.91 Norway 8.82 Norway 8.63 Canada 8.42 Qatar 8.68 14 Sweden 8.88 Canada 8.80 USA 8.54 Germany 8.33 Germany 8.49 15 USA 8.87 Iceland 8.72 Germany 8.48 USA 8.05 France 8.46 16 Norway 8.83 Chile 8.69 Finland 8.48 Hong Kong 7.71 USA 8.16 17 Germany 8.72 UK 8.67 UK 8.34 Brazil 7.69 Ireland 8.09 18 Netherlands 8.63 USA 8.56 Portugal 8.24 France 7.63 Netherlands 7.82 19 UK 8.54 Portugal 8.52 France 8.21 China 7.62 Hong Kong 7.49 20 Malaysia 8.40 Greece 8.52 Hong Kong 8.16 Ireland 7.60 UK 7.41Survey question: The risk of political instability is very low.1. IMD WCY Executive Opinion Survey based on an index from 0 to 10. The IMD included 58 economies in the 2010 survey.Sources: IMD World Competitiveness Online 1995-2010 (Updated: May 2010); AustradeAustralia was ranked one of the most politically stable countries in the world in 2010 and is the only country that has consistently ranked in the top fivesince 1999. Section 5. Stable Environment 53
    • Index of Economic Freedom World Ranking1 – 2009The higher the score the better the rating Hong Kong (1) 89.7 Singapore (2) 86.1 Australia (3) 82.6 New Zealand (4) 82.1 Ireland (5) 81.3 Top 10 Switzerland (6) 81.1 Ranking Canada (7) 80.4 USA (8) 78.0 Denmark (9) 77.9 Chile (10) 77.2 UK (11) 76.5Luxembourg (14) 75.4 Netherlands (15) 75.0 Japan (19) 72.9 Germany (23) 71.1 Taiwan (27) 70.4 South Korea (31) 69.9 Spain (36) 69.6 Other Key UAE (46) 67.3 Economies Malaysia (59) 64.8 France (64) 64.2 Thailand (66) 64.1 Italy (74) 62.7 Brazil (113) 55.6 Indonesia (114) 55.5 India (124) 53.8 China (140) 51.0 Vietnam (144) 49.8 0 10 20 30 40 50 60 70 80 90 1001. The 2010 Index of Economic Freedom covers 183 countries and measures 10 separate components of economic freedom (Business Freedom, Trade Freedom, Fiscal Freedom, Government Spending, Monetary Freedom, Investment Freedom, Financial Freedom, Property Rights, Freedom from Corruption and Labour Freedom). The 2010 Index is based primarily on data covering the period from July 2008 through June 2009. The number in brackets in the chart refers to the country’s world ranking.Sources: The Heritage Foundation and Dow Jones & Company, Inc., Washington D.C., 2010 Index of Economic Freedom; AustradeAustralia ranked third in the world for Economic Freedom, with a score of 82.6. The country’s overall score is well above the weighted averages of the Asia-Pacific region (53.8) and the world (56.7). The Wall Street Journal and The Heritage Foundation have stressed that Australia’s sound economic frameworkand well-implemented structural reforms have allowed the country to weather the Global Financial Crisis better than many other advanced economies.Underpinned by robust financial regulation, Australia’s banks have coped well with the financial turmoil. Monetary stability and openness to internationalbusiness continue to facilitate a competitive investment environment based on market principles. A strong rule of law protects property rights, andcorruption is perceived as minimal. Both foreign and domestically owned companies enjoy considerable flexibility under licensing and regulatory schemes. Section 5. Stable Environment 54
    • Business Environment Australia China Hong Kong Japan India Singapore USA UK World Competitiveness Yearbook 2010 Rankinga in: Ethical Practices 3 32 25 12 35 8 15 17 Risk Factors in the Financial System 4 43 15 25 10 2 50 55 Protectionism 7 46 11 31 32 13 39 30 Competition Legislation 7 34 29 12 39 10 24 27 Financial Institutions’ Transparency 7 56 17 23 11 2 49 47 Investment Risk1 9 35 21 18 54 19 12 15 Global Competitiveness Report 2009-10 Rankingb in: Soundness of Bank 3 66 5 84 25 8 108 126 Efficacy of Corporate Board 5 92 52 24 63 8 20 23 Judicial Independence 5 62 14 23 37 19 26 16 Regulation of Securities Exchanges 6 91 16 40 11 4 47 46 Effectiveness of Anti-Monopoly Policy 7 50 84 13 25 8 11 17 Reliance on Professional Management 7 46 38 19 30 8 11 13 Transparency International 2009 World RankingC in: Corruption Perception Index2 8 79 12 =17 84 3 19 =171. IMD sourced the data from Euromoney country credit-worthiness.2. The Corruption Perceptions Index (CPI) measures the perceived level of public-sector corruption in 180 countries and territories around the world. The CPI is a “survey of surveys”, based on 13 different expert and business surveys.Sources: (a) Institute for Management Development (IMD), Switzerland, World Competitiveness Yearbook 2010 (58 economies); (b) World Economic Forum, Switzerlandand Harvard University, Global Competitiveness Report 2009-10 (133 economies); (c) Transparency International Corruption Perceptions Index 2009 (180 economies);AustradeAustralia is one of the oldest and most stable democracies in the world and its political and legal institutions are recognised globally for their transparency,impartiality and robustness. The country provides a safe and secure environment for global financial services firms and multinational companies looking toinvest and establish operations. Section 5. Stable Environment 55
    • Global Real Estate Transparency Index – 20101 Rank Market Score Rank Market Score Rank Market Score 1 Australia 1.22 29 Greece 2.60 59 Oman 3.50 2 Canada 1.23 30 Slovakia 2.61 60 Morocco 3.58 3 UK 1.24 31 Russia Tier 1 Cities 2.64 61 Croatia 3.59 4 New Zealand 1.25 32 Romania 2.68 62 Egypt 3.62 4 Sweden 1.25 33 Taiwan 2.71 63 Saudi Arabia 3.66 High 6 USA 1.25 34 Chile 2.72 64 Qatar 3.70 7 Ireland 1.27 36 Turkey 2.90 66 Lebanon 3.78 8 France 1.28 37 UAE – Dubai 2.93 67 Panama 3.85 9 Netherlands 1.38 38 Brazil 2.95 68 Kuwait 3.90 Low 10 Germany 1.38 39 Thailand 3.02 70 Kazakhstan 3.93 Semi 14 Spain 1.58 40 Bulgaria 3.03 71 Colombia 3.96 15 Austria 1.71 41 India Tier 1 Cities 3.11 72 Peru 4.00 16 Singapore 1.73 42 South Korea 3.11 73 Pakistan 4.18 17 Norway 1.75 45 China Tier 1 Cities 3.14 74 Venezuela 4.18 Transparent 18 Hong Kong 1.76 46 Mexico 3.14 75 Tunisia 4.24 19 Portugal 1.82 48 Philippines 3.15 76 Vietnam 4.25 20 Switzerland 1.87 50 Bahrain 3.28 77 Dominican Republic 4.28 21 Italy 1.89 51 Argentina 3.30 78 Belarus 4.48 23 South Africa 2.09 56 UAE – Abu Dhabi 3.45 79 Syria 4.65 Opaque 25 Malaysia 2.30 57 Indonesia 3.46 80 Sudan 4.68 26 Japan 2.30 58 Jordon 3.46 81 Algeria 4.741. Jones Lang LaSalle’s Global Real Estate Transparency Index quantifies real estate market transparency across 81 markets worldwide. The Index is updated every two years and has been charting the steady progress in real estate transparency across the globe since 1999. The survey measures a country’s transparency based on five criteria: performance measurement, market fundamentals, listed vehicles, regulatory and legal issues and transaction processes.Sources: Jones Lang LaSalle, Real Estate Transparency Index Global Foresight Series 2010, Mapping the World of Transparency, Chart 5: Composite Index; AustradeAustralia’s property market is the most transparent in the world, with investors given comprehensive and regular access to data regarding rents, pricesand valuations, the Jones Lang LaSalle 2010 Global Transparency Index has reported. Rising levels of transparency are associated with rising levels offoreign direct investment, the report notes – a powerful incentive for encouraging the free flow of information and the fair and consistent application oflocal property laws. The report also suggests those markets recording better transparency rates will record greater growth and recovery than closed-offmarkets. Section 5. Stable Environment 56
    • Key Indicators of Doing Business – 2010 STARTING A BUSINESS CLOSING A BUSINESS ENFORCING CONTRACTS EMPLOYING WORKERS Procedures Duration Time1 Recovery Rate2 Procedures Time Difficulty of Difficulty of Firing Costs4 Economy (number) (days) (years) (cents in dollar) (number) (days) Hiring Index Firing Index (weeks of (0-100)3 (0-100)3 salary) New Zealand 1 1 1.3 76.2 30 216 11 10 0 Canada 1 5 0.8 88.7 36 570 11 0 28 Australia 2 2 1.0 78.8 28 395 0 0 4 Singapore 3 3 0.8 91.3 21 150 0 0 4 Hong Kong 3 6 1.1 79.8 24 280 0 0 10 France 5 7 1.9 44.7 29 331 67 30 32 USA 6 6 1.5 76.7 32 300 0 0 0 Netherlands 6 10 1.1 82.7 25 514 17 70 17 Italy 6 10 1.8 56.6 40 1,210 33 40 11 UK 6 13 1.0 84.2 30 399 11 0 22 Switzerland 6 20 3.0 46.8 31 417 0 0 13 Taiwan 6 23 1.9 80.9 47 510 78 40 91 Thailand 7 32 2.7 42.4 35 479 33 0 54 South Korea 8 14 1.5 80.5 35 230 44 30 91 UAE 8 15 5.1 10.2 49 537 0 0 84 Japan 8 23 0.6 92.5 30 360 11 30 4 Malaysia 9 11 2.3 38.6 30 585 0 30 75 Germany 9 18 1.2 52.2 30 394 33 40 69 Indonesia 9 60 5.5 13.7 39 570 61 60 108 Spain 10 47 1.0 73.2 39 515 78 30 56 Vietnam 11 50 5.0 18.0 34 295 11 40 87 India 13 30 7.0 15.1 46 1,420 0 70 56 China 14 38 1.7 35.3 34 406 11 50 91 Philippines 15 52 5.7 4.4 37 842 56 30 91 Brazil 16 120 4.0 1 7.1 45 616 78 0 461. Time is recorded in calendar years. 2. The recovery rate is recorded as cents on the dollar recovered by claimants – creditors, tax authorities and employees – throughbankruptcy proceedings. 3. Each index assigns values between 0 and 100, with higher values representing more rigid labour regulations. 4. The redundancy cost indicatormeasures the cost of advance notice requirements, severance payments and penalties due when terminating a redundant worker.Sources: World Bank Group, Doing Business 2010; AustradeAustralia has been ranked as one of the most business-friendly economies in the world, offering a business environment that is both stable and flexible.The country has a robust regulatory framework that offers security and integrity, while promoting efficiency through the avoidance of time consumingbusiness processes. Section 5. Stable Environment 57
    • Australia’s Financial Regulatory Framework TREASURER Reserve Bank Australian Prudential Australian Securities and of Australia Regulation Authority Investments Commission (RBA) (APRA) (ASIC) Payment Systems Board ■ Monetary Policy ■ Prudential regulation of: ■ Market integrity ■ Systemic stability – Deposit-taking institutions ■ Consumer protection ■ Payments systems regulation – Life and general insurance ■ Corporations – Superannuation funds COUNCIL OF FINANCIAL REGULATORSNote: Membership of the Council of Financial Regulators also includes the Commonwealth Treasury.Source: KPMG 1998 Financial Institutions Performance SurveyAustralia’s financial regulatory environment is viewed as a model by many other jurisdictions around the world. Reforms in recent years have led to asystem that is both best practice in its approach and pro-business in its outlook. Supervision of the financial sector is organised along functional ratherthan institutional lines, with oversight by statutory bodies with operational independence from the government. Section 5. Stable Environment 58
    • SECTION 6High Quality of LifeAustralia’s highly desirable quality of life Worldwide Quality of Life Index 60provides a strong drawcard for skilled Worldwide Cost of Living Index 61professionals and global companies looking Human Development Index 62to establish regional headquarters. Growth in GDP Per Capita 63 Health and Environment – Pollution Problems 64 High Quality of Life
    • Worldwide Quality of Life Index1The higher the score the better 2006 2007 2008 2009 2010 Rank Score Score Score Score Score 1 Austria 9.58 Austria 9.71 Iceland 9.72 Switzerland 9.70 Austria 9.81 2 Iceland 9.41 Iceland 9.56 Switzerland 9.71 Austria 9.57 Norway 9.59 3 Switzerland 9.41 Switzerland 9.45 Austria 9.64 Norway 9.56 Switzerland 9.52 4 Denmark 9.36 Norway 9.25 Australia 9.28 Denmark 9.36 Australia 9.26 5 Norway 9.34 Australia 9.24 Canada 9.27 Canada 9.21 Luxembourg 9.24 6 Australia 9.22 Luxembourg 9.21 Luxembourg 9.21 Australia 9.20 Denmark 9.16 7 Canada 9.15 New Zealand 9.10 Norway 9.16 Sweden 9.20 Canada 9.15 8 Luxembourg 8.89 Denmark 9.08 Sweden 9.08 Luxembourg 9.13 Netherlands 9.10 9 Belgium 8.83 Canada 8.96 Denmark 8.98 Finland 9.07 Sweden 8.89 10 Germany 8.73 Singapore 8.96 Netherlands 8.91 Germany 9.05 Germany 8.78 11 Finland 8.73 Netherlands 8.74 New Zealand 8.91 Netherlands 8.94 Belgium 8.78 12 New Zealand 8.71 Sweden 8.65 Germany 8.89 New Zealand 8.88 New Zealand 8.78 13 Sweden 8.58 Germany 8.54 Singapore 8.89 Belgium 8.79 France 8.77 14 Netherlands 8.42 Finland 8.49 Belgium 8.71 Singapore 8.45 Iceland 8.61 15 Ireland 8.32 Belgium 8.47 USA 8.53 France 8.26 Finland 8.46 16 Singapore 8.30 Ireland 8.00 Ireland 8.39 USA 8.18 Singapore 8.23 17 USA 8.29 USA 7.90 France 8.17 Qatar 8.13 Malaysia 7.98 18 France 8.20 Spain 7.85 Finland 8.12 Ireland 8.05 USA 7.94 19 Hong Kong 7.52 France 7.73 Spain 7.71 Spain 7.69 Ireland 7.73 20 Spain 7.47 Czech Republic 7.31 Czech Republic 7.59 UK 7.68 Qatar 7.73 21 Malaysia 7.41 Israel 7.21 Malaysia 7.43 Malaysia 7.52 Spain 7.50 22 UK 7.14 Malaysia 7.06 UK 7.16 Czech Republic 7.32 UK 7.37 23 Qatar 7.13 Chile 7.03 Israel 6.91 Israel 7.24 Czech Republic 7.33 24 Czech Republic 7.06 Italy 6.97 Japan 6.90 Japan 7.05 Israel 7.13 25 Chile 7.04 UK 6.95 Italy 6.86 Slovenia 6.92 Japan 6.94Survey question: Quality of life is high.1. IMD WCY Executive Opinion Survey based on an index from 0 to 10. The IMD included 58 economies in the 2010 survey.Sources: IMD World Competitiveness Online 1995-2010 (Updated: May 2010); AustradeAustralia’s political and economic advantages are complemented by a welcoming attitude and excellent quality of life. In 2010, Australia’s quality of lifewas ranked fourth in the world. With one of the highest standards of living in the world, Australia offers a relatively unspoilt environment, and enviableclimate. Australian cities are regularly judged to be among the most liveable in the world by a range of international surveys. In the Economist IntelligenceUnit Liveability Ranking 2010, four of Australia’s mainland capital cities were ranked in the top ten liveable cities in the world. In Mercer Human ResourceConsulting’s Quality of Living Survey 2010, Sydney, Melbourne and Perth were ranked among the top 25 cities in the world in which to live. Section 6. High Quality of Life 60
    • Worldwide Cost of Living Index Premium Fixed Premium Fixed Unleaded Broadband Unleaded Broadband Gasoline (Residential) Gasoline (Residential) Cost of 3-Room (95 Ron) Tariffs Cost of 3-Room (95 Ron) Tariffs Living Apartment Prices Monthly Living Apartment Prices Monthly Rank1 Index2 Monthly Rent3 per litre Fee Rank1 Index2 Monthly Rent3 per litre Fee (US$, 2009) (US$, 2009) 1 Japan 131.5 1,791 NA 37.4 27 Croatia 77.5 900 1.44 20.7 2 Hong Kong 108.7 4,066 1.81 12.8 28 Taiwan 77.0 1,307 0.82 11.2 3 Switzerland 107.2 1,778 1.39 32.7 29 Portugal 76.3 1,085 1.72 29.0 4 Denmark 105.0 1,817 1.78 29.1 30 USA 75.7 3,122 0.65 20.0 5 Russia 98.4 2,079 0.64 13.3 31 Czech Republic 74.6 928 1.43 43.3 6 Singapore 98.0 2,942 1.14 16.7 32 Brazil 74.1 1,039 NA 28.0 7 Norway 94.2 1,870 1.89 51.0 33 Estonia 73.8 523 1.28 27.8 8 Italy 94.1 1,706 2.02 28.8 34 UK 73.5 2,144 1.55 23.8 9 Venezuela 93.3 2,079 0.05 31.3 35 Sweden 72.3 1,477 1.59 35.5 10 Israel 91.9 1,438 1.51 6.7 36 Ukraine 71.9 758 NA 7.2 11 Finland 90.5 1,556 1.78 39.0 37 Lithuania 71.7 628 1.42 15.2 12 Austria 89.3 1,268 1.45 36.1 38 Slovenia 70.5 1,281 1.46 21.7 13 China 88.4 994 0.49 17.6 39 Malaysia 69.2 327 0.50 19.0 14 Ireland 87.4 2,157 1.53 36.4 40 Canada 68.7 1,477 0.91 24.8 15 Greece 85.9 837 1.40 23.9 41 Thailand 68.6 549 1.09 18.8 16 France 85.9 1,772 1.68 36.1 42 Bulgaria 68.1 771 1.22 14.8 17 Netherlands 85.7 1,477 1.87 36.2 43 Australia 67.4 1,229 1.08 26.0 18 Slovak Republic 84.8 889 1.55 28.6 44 India 67.0 595 NA 5.2 19 Spain 82.2 1,536 1.39 28.8 45 Indonesia 66.9 954 0.59 20.8 20 Luxembourg 82.1 1,190 1.44 42.0 46 Romania 66.5 928 1.20 7.2 21 Belgium 81.6 2,288 1.83 29.0 47 Hungary 66.4 1,190 1.41 30.3 22 Kazakhstan 81.5 848 0.68 12.8 48 Argentina 65.7 497 0.97 31.2 23 South Korea 80.6 2,602 1.40 25.3 49 Poland 65.6 981 1.32 13.7 24 Jordan 79.8 NA 0.86 30.4 50 Colombia 65.0 994 1.28 34.8 25 Turkey 79.7 1,504 2.02 18.2 51 Peru 64.6 405 1.53 36.5 26 Germany 78.2 1,325 2.05 43.4 52 Philippines 63.8 575 0.98 21.51. Rank is based on the cost of living index 2. Index of a basket of goods and services in major cities, including housing (New York City = 100)3. Rents are based on unfurnished apartments built after 1980, with an average comfort customary in the locality and near the city centre.Sources: IMD World Competitiveness Online 1995-2010 (Updated: May 2010); AustradeWhen issues of cost and quality of life are considered together, Australia stands out as one of the world most desirable places for expatriates and theirfamilies to live and work. Section 6. High Quality of Life 61
    • Human Development Index (HDI) Top 40 HDI Rankings Other HDI Rankings Rank Country Index Rank Country Index Rank Country Index 1 Norway 0.971 21 UK 0.947 41 Poland 0.880 2 Australia 0.970 22 Germany 0.947 43 Hungary 0.879 3 Iceland 0.969 23 Singapore 0.944 44 Chile 0.878 4 Canada 0.966 24 Hong Kong 0.944 53 Mexico 0.854 5 Ireland 0.965 25 Greece 0.942 61 Bulgaria 0.840 6 Netherlands 0.964 26 South Korea 0.937 66 Malaysia 0.829 7 Sweden 0.963 27 Israel 0.935 71 Russia 0.817 8 France 0.961 28 Andorra 0.934 75 Brazil 0.813 9 Switzerland 0.960 29 Slovenia 0.929 78 Peru 0.806 10 Japan 0.960 30 Brunei 0.920 79 Turkey 0.806 11 Luxembourg 0.960 31 Kuwait 0.916 87 Thailand 0.783 12 Finland 0.959 32 Cyprus 0.914 92 China 0.772 13 USA 0.956 33 Qatar 0.910 102 Sri Lanka 0.759 14 Austria 0.955 34 Portugal 0.909 105 Philippines 0.751 15 Spain 0.955 35 UAE 0.903 116 Vietnam 0.725 16 Denmark 0.955 36 Czech Republic 0.903 129 South Africa 0.683 17 Belgium 0.953 37 Barbados 0.903 134 India 0.612 18 Italy 0.951 38 Malta 0.902 137 Cambodia 0.593 19 Liechtenstein 0.951 39 Bahrain 0.895 138 Myanmar 0.586 20 New Zealand 0.950 40 Estonia 0.883 141 Pakistan 0.572Sources: The United Nations Development Programme, Human Development Report 2009, HDR 2009 Statistical Tables, Table G: Human Development Index Trends;AustradeAustralia has the second best quality of life in the world, according to the United Nations Development Program’s Human Development Report 2009. ThisIndex is a comparative measure of life expectancy, literacy, education and standards of living across 182 countries. The superior ranking of Australia in theHDI, combined with the country’s mild climate, low pollution levels, easy access to healthcare and relatively low cost of living, is a powerful drawcard forskilled professionals and their families. Section 6. High Quality of Life 62
    • Growth in GDP Per Capita (Current Price, US$) – 2000 to 2010110,000 GDP per Capita in 2000 GDP per Capita US$ Growth since 2000100,000 90,000 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 Japan (62) Italy (22) Thailand (89) Qatar (2) Switzerland (4) Denmark (6) Netherlands (8) Austria (9) Singapore (20) Hong Kong (50) Norway (3) Australia (5) South Korea (39) USA (27) UAE (7) Indonesia (97) UK (31) Malaysia (72) China (76) Philippines (123) India (134) New Zealand (19) Ireland (10) Spain (21) Greece (18) Luxembourg (1) France (16) Brazil (51) Taiwan (73) Canada (11) Germany (17)Note: The number in brackets refers to the country’s world ranking for US$ growth in nominal GDP per capita (out of 183 economies) since 2000.Sources: International Monetary Fund, World Economic Outlook Database, April 2010; AustradeAustralia’s impressive rise in income per capita reflects the wealth creation that has flowed from nearly two decades of uninterrupted economic growth.Continued improvement in the country’s high standard of living, and its enviable quality of life, make Australia one of the most attractive locations in theAsia-Pacific region. Section 6. High Quality of Life 63
    • Health and Environment – Pollution Problems – 2010The higher the score the better Rank Country Score Rank Country Score Rank Country Score 1 Iceland 9.12 21 Hungary 6.49 41 Thailand 4.80 2 Austria 8.62 22 Portugal 6.20 42 Kazakhstan 4.78 3 Finland 8.51 23 Spain 6.16 43 Slovenia 4.73 4 Sweden 8.07 24 USA 6.02 44 Italy 4.71 5 Denmark 8.03 25 Estonia 5.93 45 Russia 4.69 6 Switzerland 8.02 26 Belgium 5.82 46 South Africa 4.57 7 Ireland 7.87 27 Czech Republic 5.76 47 Bulgaria 4.44 8 Singapore 7.80 28 Lithuania 5.76 48 Brazil 4.35 9 Norway 7.67 29 Taiwan 5.61 49 India 4.19 10 Germany 7.61 30 Greece 5.55 50 Venezuela 4.17 11 Australia 7.42 31 Qatar 5.53 51 Indonesia 4.15 12 New Zealand 7.39 32 Croatia 5.51 52 Romania 3.82 13 Luxembourg 7.06 33 Turkey 5.51 53 Hong Kong 3.67 14 Netherlands 6.83 34 Jordan 5.48 54 Mexico 3.65 15 Japan 6.77 35 Slovak Republic 5.46 55 Philippines 3.60 16 Canada 6.74 36 Ukraine 5.15 56 Colombia 3.34 17 Malaysia 6.69 37 South Korea 5.12 57 Peru 2.97 18 UK 6.67 38 Argentina 5.02 58 China 2.86 19 Israel 6.64 39 Chile 4.91 20 France 6.52 40 Poland 4.90Survey question: Pollution problems do not seriously affect your economy.1. IMD WCY Executive Opinion Survey based on an index from 0 to 10. The IMD included 58 economies in the 2010 survey.Sources: IMD World Competitiveness Online 1995-2010 (Updated: May 2010); AustradeAustralia’s ranking in Pollution Problems confirms Australia’s desirability as one of the world’s most attractive locations. Australia does not suffer the samedegree of pollution problems as those experienced in much of the rest of the world. Section 6. High Quality of Life 64
    • About the Australian Trade CommissionThe Australian Trade Commission – Austrade – is the Australian Government’s trade and investment development agency.Through Austrade’s global network of more than 100 locations in over 55 countries, we assist Australian companies to succeed ininternational business and attract productive foreign direct investment into Australia.Austrade is the first point-of-contact for all investment inquiries. Working in partnership with business and government, Austrade canprovide your company with the information needed to establish or expand a business in Australia.Austrade can also help by connecting you with the right industry and government contacts as well as providing information oninvestment regulations and government assistance programs.For more information visit www.austrade.gov.au/invest orcall 13 28 78 within Australia or +61 2 9392 2035 from outside Australia.
    • 10-11-27