Australian businesses need cost cuts; India, China seek new import sources.

MELBOURNE: Australian Trade Minister Craig Emerson today suggested slashing of costs for Australian businesses to help them compete globally, as a new report said that nations like China and India are looking for alternative suppliers within Asia for imports.

Emerson said the government should cut "unnecessary or overbearing regulations" for businesses to provide the best possible chance for success in Asia.

"We support the view that we need to do everything we can to boost the competitiveness of Australian business and that's in partnership with the businesses themselves," Emerson was qouted by 'The Austrlaian' report today.

"Where we can remove unnecessary or overbearing regulations, that's certainly a way of lifting competitiveness. So too is the investment that we are contemplating in skills in this country," he said

Business Council of Australia's report which is to be released today, has warned China, India and other Asian economies are moving away from Australian businesses and looking out suppliers from within Asia for imports such as resources and energy because of the high cost of doing business in Australia.

BCA has analysed advises that Australian industries competing in Asia face major challenges, as productivity has been flattening for many years.

"China, India and other resource and energy importers are seeking alternative suppliers - putting pressure on Australia," the analysis states.

Emerson said businesses in North and South America, Europe and Africa want to win new markets in Asia. At the same time, Australian industries face new competition from within Asia. "Both these challenges are directly concerned with the competitiveness of Australia's industries. If we are not sufficiently competitive, we risk missing out on opportunities and losing ground in our existing markets," he added.

Emerson said rather than focusing solely on the larger Asian powerhouses, Australia should also look to invest in smaller economies such as Vietnam and Indonesia.

In the report, commissioned from Boston Consulting, the BCA warned that a fall in national competitiveness would make it more difficult to find buyers for Australian goods and services and warned that on measures of competitiveness, Australia was ranking in the middle as compared to Canada, the US, Singapore and Japan.

Source : economictimes.indiatimes.com