A region in the midst of enormous change, presenting new opportunities.
Victoria has long and rich relationships with the UK and Europe built on a history of migration and well-established cultural ties.
With this strong foundation, Victoria values its modern and multifaceted relationships with the region covering trade and investment, research collaboration and economic partnerships across a host of sectors. Victoria has been represented in the UK by an Agent-General since 1868 and maintains a Victorian Government Trade and Investment (VGTI) office in London.
Victoria has also maintained offices in Frankfurt since 1982 and Tel Aviv since 2017. In a demonstration of Victoria’s strengthening relationships with the member states of the European Union, in 2023, Victoria opened a VGTI office for Europe in Paris.
Market snapshot
The UK and Europe region is in the midst of enormous change bringing with it exciting new investment, trade and partnering opportunities for Victorian goods and services across a range of industries. Sustainability and climate change have emerged as key drivers of consumer choice and business success in the region.
Victoria values its long-standing, multifaceted relationships with the UK, the EU and its 27 Member States covering trade and investment, research collaboration as well as strong people-to-people and cultural ties.
The UK and EU are major two-way trading partners for Victoria. Two-way trade in FY2022-23 totalled $2.6 billion with the UK and $19.7 billion with the 27 countries of the EU.
Australia-United Kingdom Free Trade Agreement
The Australia-United Kingdom Free Trade Agreement (A-UKFTA) entered into force on 31 May 2023. A-UKFTA is a comprehensive and modern FTA that facilitates increased trade in goods and services between Australia and the UK, as well as supports two-way investment and increased mobility between the two countries.
With over 99 per cent of Australian goods exported to the UK now entering tariff-free, the agreement opens up new export opportunities for Victorian businesses, including in the agriculture sector. Read about the potential benefits of A-UKFTA for your business by visiting the Department of Foreign Affairs and Trade (DFAT), and for specific information on tariffs, visit the DFAT tariff portal.
Australia and the UK have also signed agreements on fintech, space and cleantech in addition to entering into the AUKUS defence partnership with the United States.
Doing Business with the UK: A Guide for Victorian Companies
Developed in partnership with Global Victoria, The Australian British Chamber of Commerce and the UK’s Department for Business and Trade, Doing Business with the UK: A Guide for Victorian Companies was designed specifically to assist Victorian companies seeking to expand their horizons and explore new opportunities by exporting to or investing in the United Kingdom.
Explore more about what the Guide offers and download a free copy.
Doing Business with the Netherlands: A Guide for Victorian Companies
Developed in partnership with the Netherlands Chamber of Commerce Australia (NCCA), the Netherlands Foreign Investment Agency (NFIA) and KPMG, Doing Business with the Netherlands: A Guide for Victorian Companies provides Victorian companies with unique insights into the Netherlands and useful tips along their export journey.
Explore more about what the Guide offers and download a free copy.
Technology and Bio-Medical opportunities with Israel
With Victoria being home to the largest Israel-born community in Australia, the state shares deep economic links with Israel, especially within the technology and bio-medical sectors.
Israel’s technology ecosystem is highly regarded globally for its innovative spirit, strong entrepreneurship culture and deep talent pool. It is continuously ranked in the top 5 world-leading technology ecosystems (eg.4th on the Global Innovation Index and 5th on the Global Startup Ecosystem Report). Israel is a leader in the OECD for its GDP spend on R&D per capita, as well as several engineers and startups per capita.
United Kingdom and Europe Insights Winter 2024
Victoria-Germany – Market Snapshot
As the world’s fourth largest, the German economy is highly developed and robust.
Germany boasts one of the most robust and dynamic economies in the world, characterised by a high degree of innovation, efficiency, and productivity. As the largest economy in Europe and the fourth largest globally, Germany's economic landscape is underpinned by a strong industrial base, a highly skilled workforce, and a commitment to research and development.
The country is renowned for its advanced manufacturing sector, particularly in the automotive and machinery industries, which are globally competitive and contribute significantly to export revenues. Additionally, Germany's economic stability is supported by a diversified economic structure, including a vibrant services sector that encompasses finance, healthcare, and information technology.
Sectoral strengths further delineate Germany's economic strengths. The automotive industry is a cornerstone, with major companies such as Volkswagen, BMW, and Daimler leading in both traditional and electric vehicle markets. The machinery and equipment sector is equally prominent, known for producing high-quality, precision-engineered products that are integral to various global industries.
Germany also excels in chemical production, with companies such as BASF and Bayer at the forefront of innovation. Furthermore, the renewable energy sector is rapidly growing, bolstered by strong government support and technological advancements, positioning Germany as a leader in sustainable energy solutions. This combination of sectoral strengths not only fuels economic growth but also enhances Germany's resilience in the face of global economic challenges.
Victoria’s economic relationship with Germany is strong
Victoria values its long-standing, multifaceted relationship with Germany covering trade and investment, research collaboration as well as strong people-to-people and cultural ties.
Victoria’s trade and investment relationship with Germany is significant and with an already strong base, there are growing opportunities to further grow our bilateral economic relationship in the future.
With two-way merchandise trade valued at $6.2 billion in 2022-23, Germany is not only Victoria’s largest two-way trading partner in the European Union but also the State’s sixth-largest trading partner globally.
Victorian firms benefit from access to Germany’s vast market and technological expertise. Victorian exports to Germany totalled $481 million in FY2022-23 led by the following top exports: oil-seeds and oleaginous fruits worth $161.8 million; pharmaceutical products (excluding medicaments) totalling $89.1 million; and specialised machinery and parts worth $32.2 million.
Over the FY2022-23, the value of Victorian merchandise exports to Germany grew by 9 percent ($38 million), largely due to a $27 million increase in pharmaceutical product exports.
Imports from Germany into the State totalled $5.8 billion led by passenger motor vehicles ($1.1 billion); agricultural machinery and parts ($571.1 million) and tractors ($164.2 million).
With Victoria’s diversified economy, strategic location and world-class universities and research institutions, the State is an attractive destination for German investment, particularly in sectors including renewable energy, transportation and warehousing and biotechnology. Over the five-year period between FY2018 and 2023, Germany was the sixth largest source market of foreign direct investment (FDI) into Victoria, worth $1.53 billion and has created over 900 jobs.
Major German businesses operating in Victoria include BayWa, BioNTech and DHL with historic investors also including Siemens, Allianz and Deutsche Bahn. Opportunities for further German investment into the State is also visible in renewable energy, biotech and advanced manufacturing.
This dynamic economic relationship with Germany is underpinned by the fact that 25,365 Victorian residents were born in Germany according to the 2021 Census. Furthermore, Victoria welcomes a significant number of international visitors from Germany every year (totalling 54,700 in 2023 approximately double the number of the previous year).
Victoria and Germany: A collaborative partnership
The Victorian Government maintains close working relationships with the Embassy of Germany in Canberra, the Honorary Consulate of Germany in Melbourne and Germany Trade and Invest (GTAI) — the international economic promotion agency of the Federal Republic of Germany.
The Victorian Government also works closely with the German-Australian Chamber of Industry and Commerce (AHK Australien) with its Melbourne office based at International Chamber House, to foster further connections and international business opportunities.
Germany’s second-largest metropolitan region, Frankfurt Rhein-Main established a representational office in Australia in April 2024 through a partnership with the German-Australian Chamber of Industry and Commerce.
The region, which contains the global financial hub of Frankfurt, has a population of 5.8 million people and ranks as the European Union’s fourth-largest region by GDP.
Global Victoria looks forward to working closely with Frankfurt Rhein-Main to grow their Australian presence.
Victoria’s enhanced presence in Europe, under the leadership of Victoria’s Commissioner for Europe, the Middle East, Türkiye and Africa, Gönül Serbest and through the newly established Victorian Trade and Investment office for Europe in Paris, leads the State’s engagement with Germany and is supported by an investment office in Frankfurt.
The new office is enhancing the State’s engagement across the region and supporting Victorian companies to expand to the dynamic European market, including Germany.
Since opening in 2023, the Paris office has delivered several trade missions to Europe, including Formnext in Frankfurt.
Recent activities
Global Victoria was delighted to host Martin Kent, His Majesty’s Trade Commissioner for Asia Pacific on Friday.
With an introduction by Global Victoria’s Ema Lawrence, Martin gave a comprehensive overview of the new UK Government’s trade priorities with the region and their implications for Victoria.
With the Australia-UK Free Trade Agreement now in force, we look forward to working with Martin and his UK in Australia team to further strengthen Victoria’s dynamic trade and investment relationship with the United Kingdom.
Many thanks to our event partners, Steph Lysaght, the British Consul General in Melbourne and Matthew Joyce from the Australian British Chamber of Commerce .
Previous regional insights
Key industries of opportunity for Victorian exporters
Technology
Western Europe accounts for approximately one in every five technology dollars spent worldwide.
The UK is a key priority market identified by Victorian tech companies, and Global Victoria’s annual trade mission to London Tech Week (LTW) has been highly successful helping many Victorian tech companies expand their exports to the region.
Victoria’s growing strengths in Fintech can be leveraged in the UK by the UK-Australia FinTech Bridge.
For Europe, especially Germany and France, Industry 4.0, the use of digital technologies in the manufacturing process, is creating many opportunities for Victorian businesses in technology to export their innovation to the region.
For Israel, its AgTech industry is vast with over 280 active Agtech companies and more than 200 exporters of agricultural goods.
Food and beverage
Opportunities exist for Victorian companies that produce red meat, processed food and counter-seasonal produce. The UK has grown to be the largest market by volume and value for Australian wine. Sales of Victorian wine continue to increase as part of this growth.
There is also strong consumer demand for plant-based proteins and sustainable sourced foods in the region.
Defence
The AUKUS agreement announced in 2021 will build on the long-standing trilateral ties between Australia, the U.S. and the UK, and presents exciting opportunities for Victorian defence businesses.
With many recent Australian Defence Force (ADF) capital acquisition projects awarded to UK or European companies, Victorian companies can leverage these major projects to partner with international primes and enter their global supply chains.
Life sciences and healthcare
Europe has the highest spend per capita on healthcare.
The NHS is the largest single publicly funded health provider in the world, constituting a significant marketplace for suppliers. Health systems in the UK and Europe are seeking innovation, efficiency and cost savings. The wellness and fitness industry is growing rapidly.
Major Victorian pharmaceutical companies have a significant presence in Europe. Opportunities for medicinal cannabis exports to the region are being explored as an emerging opportunity.
Israel’s public healthcare system is advanced by international standards. Israel spends 7.5 per cent of its Gross Domestic Product (GDP) on the public healthcare system, providing universal healthcare coverage to its entire population via four health management organisations and a network of hospitals, community clinics, and specialised doctors. Israeli healthcare facilities are modern and open to adopt new, cost-effective technologies and procedures.
Israel’s healthcare technology market is estimated at $6.2 billion, of which devices account for $2.4 billion and pharma $3.8 billion. Imports make up over 65 per cent of the device market and about 60 per cent of the pharma market.
Top medical device imports are surgical instruments and other medical electronics, lab reagents, diagnostic equipment, and catheters. Top pharma imports include medicaments in measured doses for retail sale, antisera and blood fractions and immunology products
Beauty, wellness and personal care products
This is a large and growing sector across the region. The environmental impact of products, including ingredients, packaging and transportation has become a significant focus for skincare products, especially in the UK.
Europe is the world’s largest cosmetics market, worth $130 billion in 2019. Opportunities for Victorian companies exist for niche, premium, or organic brands that have a focus on simple, clean and pure ingredients.
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