Department of State Development

South Australia and China relationship

The Government of South Australia has been effectively engaging with China through a long-term partnership with Shandong Province, which celebrated its 30th anniversary in 2016.

The Government’s vision is ‘to strengthen the State’s partnership with China and enhance and deepen our long-term engagement in areas encompassing investment, trade and business, education, sport, culture, the arts, sciences, and the exchange of people, skills and ideas’.

China is South Australia’s highest export partner with an export value of $2.2 billion (in the 12 months to March 2017).

China market

China is embracing a new model of economic growth under President Xi Jinping, with attention being placed on structural reforms and environmental protection.

China is transitioning from a period of uninhibited investment expansion to a modern, advanced economy with heavy investment in upgrading the quality of education, innovation, research and development.

A stronger focus will be placed on quality urbanisation, environmental initiatives to include the establishment of a green development fund and the promotion of clean production.

The signing of the China Australia Free Trade Agreement, which entered into force in December 2015, is set to transform the relationship between Australia and China. More than 86% of Australia’s goods exports to China will enter duty free (worth more than $90 billion). Once the Agreement is fully implemented and tariff cuts are phased in, 96% of Australian goods will enter China duty free.

ChAFTA also opens up a range of new opportunities for South Australian service providers with enhanced market access for financial services companies, law firms, professional services suppliers, education services exporters, as well as health, aged care, hospitality, construction and manufacturing businesses.

Australia celebrated the 45th anniversary of its diplomatic relationship with China in December 2017.

The signing of the China Australia Free Trade Agreement (ChAFTA), which entered into force in December 2015, is set to transform the relationship between Australia and China. More than 86 per cent of Australia’s goods exports to China will enter duty free (worth more than $90 billion). Once the Agreement is fully implemented and tariff cuts are phased in, 96 per cent of Australian goods will enter China duty free.

China has become the largest trading partner with Australia and the largest export market for South Australia, representing 19.5 per cent of the total of South Australia’s export destinations. 

ChAFTA also opens a range of new opportunities for South Australian service providers with enhanced market access for financial services companies, law firms, professional services suppliers, education services exporters, as well as health, aged care, hospitality, construction and manufacturing businesses.

China is also a source market for international students, accounting for 40 per cent of South Australia’s international student population – growing by 10.1 per cent in the year to October 2017.

International visitor numbers from China were up by 58 per cent in the year ending September 2017, compared to an increase of 12 per cent nationally.

To guide South Australia’s engagement with China the South Australian Government regularly  reviews social and economic development trends in China to ensure the approach to market is targeted and focused.

For more than 32 years, South Australia has enjoyed a Sister-State relationship with Shandong Province in the People’s Republic of China.

In addition to Shandong, the South Australian Government has established new relationships with Shanxi, Shanghai and Guangdong Provinces, and are exploring new cooperative opportunities.

Memorandums of Understanding have been signed with the following Chinese Government organisations, including

  • Foreign and Overseas Chinese Affairs Office of Shanxi Provincial People’s Government
  • Shanghai Municipal Commission of Commerce (SCOFCOM)

South Australian trade representatives are strategically located in Jinan, the capital of Shandong Province, Shanghai and Hong Kong, embedded within Austrade offices. A dedicated China team is based in Adelaide, South Australia to support the states exporters to identify and explore opportunities in the greater China market.

China is embracing a new model of economic growth under President Xi Jinping, with attention being placed on structural reforms and transition of economic drivers from traditional to new economies. 

President Xi Jinping set out his vision for China’s future at the 19th National Congress of the Chinese Communist Party and outlined his vision for China going forward, including initiatives such as the One Belt One Road policy (BRI), supply-side reform (closing inefficient industry) (economic transformation of old drivers with the new ones) and the Made in China 2025 strategy. Recently, there has been a drive to increase imports to satisfy domestic demand for foreign goods and services.

China is transitioning from a period of uninhibited investment expansion to a modern, advanced economy with heavy investment in upgrading the quality of education, innovation, research and development.

A stronger focus will be placed on quality urbanisation, environmental initiatives to include the establishment of a green development fund and the promotion of clean production.

South Australian businesses have products of exceptional quality, and the sophisticated consumer market in China has recognised this.

South Australia can broaden its exports beyond its successful commodities such as iron, copper, and energy resources as well as food and wine – to a more diverse relationship incorporating value-added goods and services. South Australia has a lot to offer in areas like pharmaceuticals, education, tourism, healthcare, information technology and architecture.


Sector opportunities

 

Agribusiness, food and wine

South Australian agribusiness, food and wine companies are well placed to take advantage of China’s growing exposure to international travel and cuisine. China’s food safety concerns also provide opportunities within this key sector.

Resources and energy

With South Australia’s mineral resources sector boasting impressive figures in copper resources and production, uranium and gold, major Chinese corporations are keen to further invest in the State.

Health, aged and disability care

Driven by a rapidly ageing population, the health, aged care and disability sectors are all high growth areas for China. South Australia is well positioned to offer support as a partner in the development of this sector. 

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Services for liveability

There is significant potential of supported clusters of business and industry to drive innovation and collaboration, with South Australia concentrating on water treatment and management, waste management and recycling, modelling and simulation and architectural and design services in China.

Tourism, arts and culture

There are significant opportunities to promote South Australia as a tourism destination in Shandong Province and leverage the expertise and reputation of South Australia’s flagship cultural institutions to support the exchange of business ideas and techniques and commercial opportunities.

Education

There is the potential of South Australian education and training institutions to provide opportunities to the Chinese, with China being the top source country for international students to the State.


Success stories

  • Beston Global Food Company has formed a partnership with the Dashang Group in Liaoning Province to expand Beston’s investment in premium closed-loop food products.
  • Barossa Valley winery, Seppeltsfield, signed a yearly contract to supply 1.5 million litres of wine to the Nanshan Group from Shandong.
  • In Shanghai, a contract was signed to supply South Australia food and wine, such as Tomich Wines, to Shanghai based supermarket chain RT-MART in an aisle dedicated to South Australia.
  • Children’s theatre company, Windmill Theatre, took its award-winning production of ‘Grug’ on a seven week tour of Shanghai and has been invited back to present the sequel, ‘Grug and the Rainbow’.

     

Want to know more?

A dedicated team is on hand to support businesses looking to export to China.

Quentin Bai 
Director
Phone +61 8 8303 2130
Mobile +61 466 023 690
Email quentin.bai@sa.gov.au