12 November 2020

Key Insights

New Zealand – There is intense public discussion regarding a progressive lifting of border restrictions to allow trans-Tasman travel. Phase 1 (travel from New Zealand to New South Wales and the Northern Territories without quarantine) has commenced. The country has moved to Level 1 COVID-19 restrictions.

New Zealand – Key activity and confidence indicators suggest a swift return to pre- Covid-19 conditions in New Zealand. Austrade in New Zealand continues to receive increased levels of enquiry from Australian exporters. Trade and Investment Queensland (TIQ) will establish a presence in New Zealand from November 2020 as an initial six month pilot. 

The Cook Islands – The Cook Islands ratified the PACER Plus regional trade agreement in mid-October. This means the agreement will come into force on December 14. PACER Plus aims to support Pacific island countries and encourage regional trade. Opportunities for Australian businesses will increase over time. Austrade is working with the Office of the Pacific in DFAT, Pacific Trade Invest and business chambers to develop a business-engagement strategy.

Papua New Guinea – The government’s national electrification project – which is supported by Australia, New Zealand, Japan and the US – continues to provide opportunities for Australian companies. This includes contributing to supply chain and technical solution requirements. Austrade is working with multiple energy and engineering companies to help various consortia to bid for work.

Papua New Guinea –The risks and challenges for Australian companies continue, especially with restricted access to foreign exchange. A further downturn of approximately 20% in the transport, accommodation and mining sectors is anticipated. The construction, oil and gas sectors have been less impacted as a result of global commodity prices.

The Pacific – Pacific islands report close to zero occupancy rates in resorts and hotels, and the cruise industry is closed. All air traffic has either ceased or is available only on an ‘essential use’ basis. There is widespread discussion about extending the proposed trans-Tasman ‘bubble’ to include some Pacific Island nations. 

Vanuatu – Freight costs have increased substantially, with the cost of sea freight increasing by 30%, and of air freight costs increasing by 150–300%.

Market opportunities

New Zealand

  • Austrade has recorded a substantial increase in enquiries as a result of COVID-19. The increase appears to be driven by the anticipated lifting of border restrictions as part of trans-Tasman ‘bubble’ and the view that New Zealand is a safe/known market. Enquiries typically relate to defence/advanced manufacturing, agri-foods and health.
  • The new Trade and Investment Queensland (TIQ) post in Auckland will focus initially on five areas: food and agribusiness; health and wellness; infrastructure and construction; knowledge and innovation; and investment.
  • Austrade is also receiving direct enquiries from Australian state government agencies and ministries – including Tasmania, Queensland and ACT. The focus of enquiries is the potential to open a new market and explore partnership opportunities.

Papua New Guinea

  • Australian engineering companies engaged in a A$10 billion road infrastructure program are seeking partnerships with Australian roads companies. The geography in PNG is challenging and will require new technologies and equipment. Long-term maintenance programs are attached to the initial capital projects, providing ongoing security. The project is financed by the Asian Development Bank.
  • The Asian Development Bank (ADB) is to finance a Greenfield 4G mobile telecommunications network through Fiji’s Amalgamated Telecom Holdings (ATH) subsidy, ATH International Venture Pte. Limited (ATHIV). The new network is designed to enhance mobile, broadband and internet services, and create new opportunities for job creation and socioeconomic growth. According to ADB, Papua New Guinea is the Pacific’s largest-and-least-developed telecommunications market, since only 11% of the population have internet access.
  • The Ok Tedi mine is resuming operations after a six-week closure due to the COVID-19. Recommencement of operations is welcome news to the state and landowners with a K150million dividend paid last week. Meanwhile, Oil Search Ltd reported an 85% decline in half-year core profit, due to a slump in oil and gas prices as the coronavirus outbreak slowed economic activity and demand worldwide.
  • Newcrest’s Lihir mine has awarded has awarded the Engineering, Procurement and Construction Management (EPCM) services contract to Australian services company Worley.

The Pacific Islands

  • Fiji - The Australian Government has partnered with the Fiji Ministry of Health to improve access to medicines. The agreement aims to improve procurement & supply chains for medicines and consumables. This could open opportunities for Australian med-tech industries.
  • Fiji - The Business Partnerships Platform (BPP) is holding a new round of invitations for business ideas that could have a social impact. Austrade will help DFAT promote the round. Applications close on 8 December 2020.
  • The Pacific - The COVID0-19-induced economic downturn across the region means new borrowing and debt funding for infrastructure by Pacific Island governments is extremely limited. As a result, new funding and contracting models will be required.
  • Samoa - There is a temporary ban on the importation of all avian and ratite meat – such as ostrich meat. The ban includes meat products, by-products, eggs, egg products, live birds, and animal reproductive materials from Australia. The aim is to prevent the potential spread of the avian influenza virus.

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