Investment in Australia
Australia’s economy has outperformed its peers for more than two decades and has proven its appeal to North American investors. At the end of 2016, foreign direct investment from the US into Australia was valued at AUD$195 billion (the largest of any country), while FDI from Canada into Australia was valued at AUD$29 billion.
In 2016, two way investment stock between Australia and Canada was worth over A$85 billion while two-way trade in goods and services was A$6.37 billion. Canadian investment in Australia was valued at A$42.6 billion, ranking it as Australia’s 12th largest investment source, an 11.4 per cent increase over 2015. Approximately 90 Australian companies have an established presence in Canada in sectors such as resources and energy, education, finance, travel services and retail.
In recent years, major Canadian investment in Australia has largely focused on infrastructure, resources and agribusiness projects, often through institutional investors such as public pension funds. However, there is growing interest from Canadian investors in high-growth knowledge-based sectors, such as fintech, medtech, and the mining, equipment and technology services (METS) area.
Over the past decade, two-way investment stock between Australia and the US increased by approximately 130 per cent and, by the end of 2016, stood at A$1.47 trillion.
Investment from the US into Australia has represented around a quarter of all foreign direct investment into Australia for over three decades. In 2017, the total cumulative US investment in Australia was approximately A$860 billion.
The US has been the largest destination of outbound Australian investment for many years, with total cumulative Australian investment in the United States estimated to be A$617 billion. There are more than 400 Australian parent companies with 1,500 individual entities in the US.
This two-way investment demonstrates a deep relationship between countries that have a great deal in common. Secure property rights and procedural fairness mean that Australia’s economic relationship with the US spans access to capital, technological diffusion and knowledge transfers. In each of these domains, the United States is Australia’s most valuable partner.
Indispensable Economic Partners Report
Produced by the United States Studies Centre at the University of Sydney
(USSC) with support from the American Chamber of Commerce in Australia
Indispensable Economic Partners report
is a comprehensive analysis of the investment relationship between
Australia and the US, its largest direct investor.
Image source: Indispensable economic partners: The US-Australia investment relationship Report - Two way investment