Regional insights

The staging of an Australian Football League (AFL) regular season game in Shanghai provides a platform to promote Victoria’s globally competitive sports ecosystem.

The most recent game, held on 2 June 2019 between St Kilda and Port Adelaide, was the third match ever played outside Australia and New Zealand for premiership points and the first to involve a Victorian club. The game attracted a crowd of approximately 10,000 people and a television audience of 3.9 million (of which 3.7 million were Chinese viewers).

In support of the China game, St Kilda ran a five-day corporate program for more than 60 companies, around half of which were Victorian, while the AFL hosted a Gala Dinner that was attended by 550 Australian and Chinese guests and showcased Victorian products.

The AFL’s involvement in China is just the tip of the sports iceberg. Victoria is well placed to help China achieve its plan to grow its sports industry to one per cent of GDP by 2020.

In 2019, Global Victoria has worked to build the relationships and connections necessary for Victoria’s sports industry to develop relations with China by:

• supporting the National Basketball League’s newest franchise, the South East Melbourne Phoenix to complete a preseason tour of China. In May, the Phoenix played its first ever competitive games against the Jiangsu Dragons and Shanghai Sharks in Nanjing and Shanghai, respectively
• assisting the Victorian Racing Club to launch its International Fashions on the Field project in Shanghai, showcasing Victoria’s high-quality fashion and entertainment to drive greater international attendance at the Melbourne Cup Carnival
• signing a Letter of Intent with the Shanghai Administration of Sport agreeing to work together to foster collaboration and cooperation, including exploring opportunities to organise inbound and outbound sports trade missions to create new export opportunities for Victorian firms.

In 2020, there are many exciting potential sports events that will further Victoria and China cooperation, including collaborations in tennis and cricket.

In April 2019, The Victorian Premier joined joined the Governor of Jiangsu Province, Wu Zhenglong, in Nanjing at a ceremony to mark Victoria’s oldest and most enduring sister-state relationship that has been the cornerstone of Victoria’s Chinese engagement for many years.

Over four decades since 1979, Victoria and Jiangsu have worked together successfully in a range of sectors, including science, technology and innovation, creative arts, and education, and has seen:

• almost 52,000 tourists from Jiangsu visit Victoria in 2018, which is up nearly 42 per cent since 2014
• 138 Victorian students taking part in intensive language study in Jiangsu Province thanks to the Victorian Government’s Hamer Scholarships Program, which is about boosting cultural ties and knowledge
• the Southeast University-Monash University Joint Graduate School at Suzhou having 647 graduates from the school since opening in 2012, with 633 currently studying on campus
• over 50 Jiangsu and Victorian workers involved in workforce training and development thanks to the Victoria-Jiangsu Health Collaboration Agreement
• more than 900 medical professionals taking part in reciprocal visits for training and clinical exchanges.

As part of the anniversary, Victoria and Jiangsu will participate in an artist-in-residency program. This will provide the opportunity for a Victorian artist to travel to Jiangsu, to create an artwork to be gifted to our sister-state, with Victoria hosting an artist from Jiangsu.

The landmark agreement recognises the close relationship between Victoria and China and is the result of dedicated engagement at all levels of government, including four visits to China by the Victorian Premier and follows the decision by the Australia-China Belt and Road Initiative (ACBRI) – a not-for-profit organisation which provides a coordination point for Australian companies seeking opportunities under the Belt and Road Initiative –  to establish their headquarters in Melbourne.  .

Agreed in October 2018, the Memorandum of Understanding (MoU) is a high-level document that provides a framework for future cooperation, including:

• dialogues and exchanges
• joint research
• knowledge sharing
• capacity building.

The Victorian Government has worked to ensure the Belt and Road Initiative was open to Victorian businesses.

The MoU builds on Victoria’s already strong relationship with China, and will ensure we are best placed to capitalise on the investment opportunities possible through the Belt and Road initiative, meaning more trade, jobs and investment for Victoria.

Fast facts about the MoU

• The MoU does not bind Victoria to any specific project or initiative.
• The Victorian Government will consider both Victoria’s and the national interest before agreeing to any specific activity.
• The MoU is not legally binding and this is specified in the MoU.
• The MoU will provide support for Victorian businesses to unlock significant trade and investment opportunities in China.

Download and read the Memorandum of Understanding
PDF, 149.5 KB

If you're a Victorian business interested in pursuing opportunities generated by the Belt and Road Initiative, send an email to Victoria’s Regional Specialist for China, and Belt and Road specialist Jason Fitts.

Victoria's China Strategy provides a plan to:

• support economic growth in Victoria and in China
• deepen our understanding of each others' people and culture.

It set four ambitious ten-year targets from 2016 to 2026, across trade, investment, visitors and students.

The 2018 progress report highlights the achievements and successes since the initial strategy was launched.

In the first 2 years, 2 of the 4 key targets have already been exceeded. Victoria has received more investment and more postgraduate students from China than the established targets. We're on track to surpass all targets by 2026.

The progress report also highlights the strength of our cultural ties and people-to-people links, showcasing:

• our shared success in education, government and cultural collaboration
• how we are achieving our vision of becoming Australia's gateway to Asia.

Download a read Victoria's China Strategy

Download and read the China Strategy Progress Report 2018

In May 2017, the Victorian Premier joined more than 90 world leaders in Beijing for the Belt and Road Forum.

Opened by Chinese President Xi Jinping, the Forum hosted the United Nations Secretary-General Antonio Guterres and President of the World Bank Jim Yong Kin, as well as the heads of state from countries including Argentina, Italy, Greece, Russa, Indonesia, Sri Lanka and Pakistan.

Participating in a key international panel discussion, Victoria's Premier highlighted the state's leadership and achievements with its engagement with China and promoted Victoria’s infrastructure, transport and investment agenda.

The Victorian Government is committed to working to build the government-to-government relations to facilitate the development of people-to-people links and mutually beneficial commercial partnerships.

China’s Belt and Road Initiative was identified in the Victoria Government’s China Strategy as an area where Victorian businesses could provide services to Chinese customers. On 25 October 2018, the Victorian Premier and Chinese Ambassador finalised a Memorandum of Understanding (MoU) between Victoria and China on the Belt and Road Initiative.

Victoria is the first and only Australian state to reach an agreement on the Belt and Road Initiative with the Chinese government and marks an important step forward in China’s and Victoria’s relationship.

The Chinese Government’s plans to create a “Greater Bay Area” (GBA) in Hong Kong, Macau and nine cities in Guangdong, including Shenzhen and Guangzhou, offering opportunities to Victorian businesses positioned to benefit from growth in southern China.

The GBA aims to create a science and technology hub to rival the world’s innovative bay cities such as Tokyo, New York, Melbourne and San Francisco. Parts of the region are already technology centres and the GBA is expected to intensify connections, competition and capital to further drive innovation and development.

Infrastructure projects are already under construction to strengthen connections within the GBA:

• a 55 kilometre-long Hong Kong–Macau–Zhuhai bridge, expected to open in 2018, will reduce travel time between the three cities from four hours to thirty minutes;
• a fast train link connecting Guangzhou, Shenzhen and Hong Kong will be completed in 2018; and
• a bridge and tunnel connecting Shenzhen and Zhongshan is expected to open in 2021.

The GBA will build on the strengths of Hong Kong’s financial and professional services sectors, Shenzhen’s high-tech manufacturing and innovation skills, and the manufacturing strengths of Dongguan and Guangzhou. The GBA is expected to free up the flow of people, logistics, capital and information across the region and by 2020 become a world-class cluster of cities.

Opportunities in the GBA

The GBA’s will be one of the world’s largest economic regions:

• In 2017, the combined GDP of the 11 cities in the GBA reached US$1.4 trillion, or 12 percent of China’s economy.
• The GBA’s eleven cities have a total population of nearly 67 million.

There are likely to be opportunities in science and technological development, particularly in health/life sciences and medtech, as well as increased opportunities to sell premium food and beverage products as incomes continue to increase. There are also likely to be opportunities in education and training, and logistics, all of which are strengths of Victorian companies.

The Victorian Government has built strong government to government relationships in the GBA which will help Victorian companies to develop trade and investment opportunities. The Victorian Government businesses office in Hong Kong is focussed on assisting Victorian businesses looking to expand into the area.

The Chinese International Import Expo which will run from 5 to 10 November 2018 in Shanghai will mark a change in China’s trade policy with immense implications for Victoria. The Forum was announced at the May 2017 Belt and Road Forum in Beijing by President Xi Jinping which was attended by the Victorian Premier.

The Import Expo is the first step by the Chinese Government to shift its trade strategy from export promotion and trade surpluses to achieving “balanced trade” by importing hundreds of billions of dollars worth of goods and services over the next 10 years.  The Chinese Government also aims to reduce tariffs and streamline quarantine and customs processes. Victoria currently exports $6.3 billion worth of goods to China and imports $18.7 billion. Exports of Victorian services such as education and tourism to China are also substantial.

The Chinese Government’s new trade strategy aims to obtain high technology equipment to develop high technology industries and a sophisticated service sector in China, and to supply consumption goods and services such as food, tourism and education to meet the demands of China’s growing middle class. These are sectors where Victoria has strong existing exports and potential for growth.

International trade institutions and rules will be a topic of discussion at the Forum which will  bring together trade ministers from many of the world’s major trading countries.

Chinese buyers, international exporters and national trade ministers are registering to attend the Forum. Austrade has announced that Australia will have a stand in the national pavilion and that Commonwealth Trade Minister will attend. The Forum will host an area for businesses and a separate pavilion for national stands. Victorian Government representatives will attend the Forum to support Victorian businesses looking to export goods and services to China.

In 2017 it became clear that although various agencies of the Chinese Government, including the Chinese Ministry of Commerce, would restrict Chinese outward investment, these restrictions would not apply to the science and technology research sector. This enables Chinese businesses to continue to develop their innovation capabilities by investing in overseas leaders in innovation. Chinese science and technology parks, a major focal point for government and private capital for investment, have appeared on the investment landscape in Victoria.

• The Suzhou High Technology Town has established the Jiangsu Victoria Innovation Center in Melbourne with Victorian partners;
• Investments by technology interests from Shandong, Tianjin and Shenzhen are under discussion with Victorian partners.

Areas of interest for Chinese science and technology investors include Victoria’s medtech, new materials, agricultural technology, and new energy industries.
The potential benefits of such investments for Victoria are substantial as they can provide:

• A source of capital for research and start up enterprises;
• Collaborative science and research partners;
• Links with likely substantial generators of intellectual property (IP) in the future;
• Better links to markets for Victorian products and services.

The China Victorian Government Trade and Investment office network is working to identify Chinese investors likely to invest in Victoria using models of engagement most advantageous to the development of Victoria’s science and technology industry.