Home Articles End of the Tyranny of Distance? Going global in the digital age.

End of the Tyranny of Distance? Going global in the digital age.

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The world is getting much smaller, which is a particularly good thing for Australia, writes Austrade’s Chief Economist Tim Harcourt.

For me, it all started with yabbies.

When I first joined the Australian Trade Commission (Austrade) I met a remarkable woman called Mary Nenke from Kukerin, a wheat-belt town in Western Australia.

Mary, a mother of six from a large local farming area, had been hit by drought. But like all good rural Australians, Mary was resilient and innovative. She noticed that the yabbies she caught in the local billabong could be prepared and sold as a specialist delicacy as a sideline to the farm. When the drought threatened her farm and those of her neighbours, she managed to get together all the local drought stricken families to set up a collective yabbying business (which now is defined by the ABS as ‘Aquaculture’).

Mary had intended to sell the yabbies locally, but then she grew ambitious and decided to sell them to Perth. She’s also heard some talk on the ABC about the internet or World Wide Web. She set up a web page and, low-and-behold, she received hits not just from Perth but from Singapore, Hong Kong, the USA — and eventually all over the world.

Mary, thanks to the web, became an ‘accidental exporter’, and she went on to become Rural Business Woman of the Year, a WA Exporter of the Year finalist, and on to fame and fortune (she even put one of her sons on the TV show ‘The farmer wants a wife’!).

Mary’s example of using the web to market her brand globally (even if at first by accident) wasn’t an isolated example. Exporters were early adopters of the web and e-business. Even in the early days, around 1997, 70 percent of exporters were using the internet compared to 28 percent of non-exporters. Why? Because, like all forms of innovation, exporters tend to be first out of the blocks. Exporters on average, pay better wages, provide more secure employment, invest in education and training and bring in new products and services faster than non-exporters. After all, they have more to gain, as they are looking at a global market.

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Austrade itself, when I joined, was going through the motions of the information age project (initiated, I understand, by Paul Twomey himself) and was sending me and my colleagues to Silicon Valley on a regular basis. The Trade Commission was taking advantage of the new economy tools and advances in technology to help clients. Much of it proved invaluable — especially when certain shocks to the global economy like terrorist attacks and epidemics made travel difficult for clients.

But now we have the next phase of the digital revolution with broadband, which moves us beyond the mere setting up of websites. So “you ain’t seen nothin’ yet!”

As Treasury Secretary Ken Henry recently said in a speech, the Australian economy is in a major structural transition in response to the four large, long-term forces – namely: population ageing, climate change adaption, the information and technology revolution and the rise of China and India as global economic powers.

And Australian exporters will be great beneficiaries of this once-in-a-generation investment in digital infrastructure. After all, as our Argentinean colleagues tell me, it takes two to tango. And with our customers, clients and potential investors already on broadband, our exporters and investors have to be too.

I was just in Seoul and they’re totally switched on as are most of our major trading partners in Asia and in the rest of the OECD. We’ll be able to engage with the world at great speed as the next phase of the digital revolution ramps up.

How has it affected Austrade’s own work? We’ve set up industry portals for trade promotion, our industry groups run webinars to communicate with international partners (rather than just relying on conferences) and we’ve had unprecedented interest in our social media networking sites and our multimedia content. Austrade can better interact with our clients now with these initiatives and according to our senior ICT advisor for ICT, Divya Raghavan, our efforts were recognised at the 2009 Broadband summit in Auckland as a good example of Web 2.0 engagement by government.

One thing that stands out in our experience is the potential gains on hand to diverse groups of exporters. For example, the high-value education export sector will be able to deliver services in-market. Architectural firms and builders will be able to share large files easily and cheaply and our retail sector will be less constrained by geography in selling their wares to the world (like Naked wines auctioning Australian wines in the UK via Twitter).

Just as in the yabby example, many exporters from around Australia will be able to take advantage of broadband. This will especially help regional Australia. It will help break down the cost of doing business within Australia and between Australia and the rest of the world. It will help accelerate Australia’s comparative advantage in exporting professional services in areas like architecture, finance, education, healthcare and logistics. It will enable us to unleash our creativity on the rest of the world in a way we’ve never seen before. It will enable investors to take advantage of the great opportunities we have here with our strong links with the Asia Pacific and the emerging economies.

I may have been talking Yabbies in the case of Kukerin, but for Australian exporters overall, the digital revolution through broadband will ensure that the world will really become their oyster.

Tim Harcourt is Chief Economist of the Australian Trade Commission (Austrade) and the author of The Airport Economist.

If this subject interests you, register for Anthill’s Global Growth by Design evening seminar and networking event in Melbourne.

Use the promo code ANTHILL when prompted for a hefty discount. Only $45 per person.

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