Column from the Premier of Tasmania: Tasmania’s Place in China

Tasmanian Premier Lara Giddings discusses the integral role China and Asia can play in the economic future and prosperity of Tasmania, following her inaugural visit to China in September.

On first impressions Tasmania would appear to be, quite literally, a world apart from China and the broader Asian region.
One is the fastest growing region on the planet, the other is Australia’s smallest state with a population equivalent to a single suburb of Beijing.
However, my recent trade mission to China, Vietnam and Hong Kong has shown just how much Tasmania has to offer in what has been described as the ‘Asian century’.
Tasmania’s relationship with China has been forged on an initial foundation of trade and investment to the point where China is now Tasmania’s biggest export destination
Last year Tasmania’s merchandise exports to this country totalled $778 million, almost a quarter of total overseas exports, with the main commodities being iron ore, zinc, woodchips, abalone, aluminium and tin ore.tasmania_aquaculture_web
China is also an important market for Tasmanian wool, rock lobster, Atlantic salmon and wine. Europe’s leading wine publication ‘The Drinks Business’ recently ranked Tasmania as second only to China as the best wine investment location in the world.

*Pictured right: Aquaculture forms a substantial amount of Tasmanian exports to China.

My mindset is not about what China can do for Tasmania, but how we can work together for mutual gain.
It is clear that while Tasmania can reap the benefits of the Asian century, we can also contribute a lot to the development of this region across a range of areas.
Tasmania may be small but we have the cleanest air on the planet, pristine wilderness areas, high quality produce and world-class investment opportunities in agriculture, renewable energy and mining.
A highlight of my recent trade mission was the agreement between our State-owned Hydro Tasmania and Guohua Energy which will see Guohua buy a 75 percent stake in the $400 million Musselroe Wind Farm project in Northern Tasmania.
This is clear evidence that Tasmania welcomes Chinese investment.
Tasmania has a natural competitive advantage in renewable energy production and research.
With Tasmania’s entire post-World War Two industrialisation built off the back of hydro power, we are uniquely positioned to partner with China in its quest for sustainable growth.
There is an all too common perception that somehow China’s rapid industrialisation has little regard for environmental issues – yet China is the world’s largest investor and producer of renewable technology.
My Government is determined to embrace the Asian Century, and we recognise that our future lies in building on the strong foundations that have already been laid.
Tasmania is the only Australian State to commission its own White Paper on its place in the Asian century, which will build on the work currently being done at a national level under Prime Minister Julia Gillard.
tasmania_natural_beauty_webThe early work we have done suggests Tasmania’s economic future lies in meeting the needs of the growing Asian middle class.
These are the future consumers for Tasmanian wines, dairy, tourism, education and other high quality services and products.

*Pictured left: Island State: Tasmania hopes to capitalise on its natural wilderness in attracting Chinese tourism.
But it is important to recognise that Tasmania’s relationship with China is not just about making profit from exporting to each other.

Just as the recent episode of Australia’s economic expansion has been driven by a resources boom, I believe that the next phase of growth will be driven by a rural commodities boom as Asia’s burgeoning middle class increases its demand for nutrition.

Our rapidly expanding dairy industry highlights the growing confidence in our rural industries with around $500 million of private investment currently on the books.
In a dry country like Australia, one of our key advantages is reliable water. Tasmania makes up just 1 percent of Australia’s landmass but we have 12 percent of its fresh water.
We are seeking to make the most of that advantage by doubling the amount of irrigated land through a $400 million investment in major irrigation schemes.
While Tasmania’s relative isolation has in the past been seen as a weakness, our proximity to Antarctica and the Southern Ocean has made us a hub for Antarctic exploration and research.
This research capability, underpinned by the University of Tasmania and the roll-out of the superfast National Broadband Network also makes Tasmania an ideal destination for international students.
It is that sense of escape and mystery which also makes Tasmania an attractive tourism destination.
For all these reasons and more Tasmania is ideally positioned to benefit and contribute to the rise of the Asian century.
But none of this is preordained. We live in a world where skills and capital investment are highly mobile.
I have no expectation vast riches will magically flow to Tasmania as a result of China’s rapid development.
As I see Tasmanians entering our school system it is difficult to imagine the sort of jobs they will be undertaking 20 years from now.
But what I do know is that those jobs will most likely be part of Tasmania in the Asian Century.
Whether it’s providing financial or educational services to China via virtual technology powered by high speed broadband, direct connections bringing tourists from Beijing or Shanghai, or encouraging their investment in our industries, we need to build a stronger bridge to our Asian neighbours.
Tasmania is a small place in Asia – but we can make a big impact. 
*Tasmanian Premier, Lara Giddings, recently led the state’s first trade mission to China.
Facts and Figures:Tasmanian exports to China
Total export value to China
2011-2012:  $735 million (23% of total exports)
2010-2011:  $565 million (17.8% of total exports)
2009-2010:  $457 million (15.3% of exports)
Major exports in 2011-2012:

  • Meat: $4 million
  • Seafoods: $31 million
  • Iron ores: $340 million
  • Lead ores: $22 million
  • Hides and skins: $12 million
  • Forestry products: (logs, sawn timber) $56 million
  • Wool: $13 million
  • Aluminium alloys: $88 million
  • Zinc alloys: $112 million
  • Unassembled motor vehicles for transport of goods: $10 million
  • Other: $19 million
  • Students: Students enrolled at Tasmanian institutions as at August 2012:  1,628    (total for country is 136,372)
*Source: Tasmanian Department of Economic Development

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