The epidemic and geopolitics have hindered the expansion plans of an Australian company in Asia. China, which has long been a source of demand in almost every industry and product area, has also become a risk. What can Australian businesses achieve in Asia? Diversify. It’s important not to disregard the rest of Asia.
Japan and Korea are two of Asia’s wealthiest countries. Consumers in these countries are continuing to shift to healthier, higher-quality options, and they’re becoming more open to new, novel, and foreign brands. South Korea’s wine market is expected to rise at a rate of over 6% per year through 2025, a trend that is anticipated to accelerate as people’s preferences for and knowledge with wine grow.
In terms of economics and trade, Asia’s global cities—Singapore, Hong Kong, and Macau—punch much above their weight. Singaporeans are Asia’s most affluent consumers. The rules are clear, consumers are interested, and growth is strong and consistent. Coffee demand in Singapore is growing at a rate of 5-7 percent each year. The food and beverage sector in Hong Kong is expected to develop at a rate of approximately 11% each year until 2025.
Taiwan, a cosmopolitan, prosperous, and open market, is hard at work negotiating new trade agreements and making itself a more inviting country to sell to and do business in. Australia and Taiwan recently signed a new agricultural commodities cooperation agreement, which includes investment and technology exchanges. There will undoubtedly be more deals encompassing a wider range of sectors and products. Australian brands that enter now are pushing on an open door and will reap the benefits of being first; in a few years, the push will likely turn into a rush.
Malaysia, which is larger than Taiwan and has earnings comparable to those in China, benefits from its close proximity to Singapore, the widespread use of English, and fast-growing incomes. Over the next five years, beer consumption will rise by more than 40%, while meat and dairy consumption will rise by more than 30%.
Indonesia, Asia’s third most populous country, is developing at a comparable rate, with consumers seeking modern conveniences, novel foods, high-quality beverages, and much more that Australia has to offer.
Consumer incomes are rising in these and other Asian markets, increasing demand for much of what Australian companies excel at producing—high-quality meat, coffee, wine, juices, soft drinks, healthy and organic items, and so on.
Although China will continue to be a major source of Asian demand and sales for Australian businesses, the case for diversification—and the unexplored prospects available—is compelling. Diversifying into other attractive Asian markets will help Australia Inc to reap the benefits while avoiding risks, seizing hitherto untapped opportunities, and generating balanced and sustainable growth in the area.