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Aussie exporters set sights on Latin America

Latin America is the most favoured destination for new orders in the coming year as exporter confidence for increased sales hits record high, according to the 2010 DHL Export Barometer.

Australian exporters have set their sights on the emerging economies of Latin America, Asia and Africa for new export sales over the next 12 months, the 2010 DHL Export Barometer suggested.

The annual survey of Australian exporters also found that the high exchange rate and Global Financial Crisis contributed to lower-than-expected sales in the past 12 months; but it’s not all bad news: a record number of exporters are confident of increasing sales in the next three months.

According to DHL Express senior vice president, Oceania, Gary Edstein, the results show Australian exporters’ resilience and nimbleness in targeting emerging economies early to boost flagging profits.

“While only 19 per cent of businesses exported to Central and South America in the past 12 months, almost two thirds of those surveyed (63 per cent) expect to increase their orders to the region in the next year,” he said.

“Australian exporters tend to be very proactive and are always looking for new trade partners to diversify their opportunities. This adaptability is crucial to weather-proofing exporters against fluctuating global markets and for business continuity in uncertain times.”

Austrade chief economist, Tim Harcourt, said Brazil has joined Asia as a key engine of growth in the global economy and this is attracting the focus of Australian exporters and investors.

“Brazil has strong macroeconomic management under the administration of President Lula and approximately 20 million additional middle class Brazilians are expanding their purchasing power at home and abroad, making it an attractive destination for Australian exporters,” he said.

Other key export growth regions for the coming year are South East Asia (62 per cent), China (61 per cent), Africa (59 per cent) and India (59 per cent).

The Middle East was the most favoured destination for Australian exporters last year, but has dropped to tenth place this year.

“The construction boom in the Middle East has slowed, particularly in United Arab Emirates. In addition, the impact of the GFC on global financial services, travel and tourism – particularly in Europe, UK and USA, has especially affected hubs for financial services and transport like Dubai,” said Harcourt.

Unsurprisingly the soaring exchange rate and Global Financial Crisis hit Australian exporters hard in the past 12 months. In 2009, 60 per cent of exporters predicted that their export orders would increase in the year however, only 38 per cent recorded an actual rise.

Despite this, exporters are optimistic for the future with 53 per cent forecasting an increase in orders in the next three months and 69 per cent in the next 12 months, equalling the highest recorded confidence in the survey’s eight-year history.

“In 2009, world trade contracted by the largest amount in 70 years and Australia was the only industrialised country to achieve positive export volumes; a remarkable achievement by Australian exporters,” Harcourt said.

These results show that exporters are looking beyond the recent global financial turmoil and just getting on with business. The exchange rate is now their biggest concern, although exporters are learning to compete overseas even with a high dollar.”

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