Financial services exports could add billions

Research commissioned by the Investment and Financial Services Association (IFSA) has suggested policy and legislative changes encouraging the export of Australian financial services have the potential to add billions of dollars to the value of the Australian economy.

The Later Economics study titled “Other People’s Money” argues that exports of finance and insurance industry services are currently comparatively modest, ranking just 27th out of the 35 industries comprising the Australian economy.

“This is a weak export record, especially compared with similar industries overseas which already export a high proportion of funds management services, such as the United Kingdom and Ireland,” it said. “This lack of export performance stands out all the more starkly compared with its strong domestic growth.”

Commenting on the research report, IFSA chief executive Richard Gilbert said the Australian financial services industry’s current performance was certainly not in keeping with the nation’s export capacity.

“That is something we are keen to work with the Government to improve,” he said.

“Australian fund managers increasingly handle the Australian portfolio investments of non-residents, but missing so far in the development of our industry is the widespread management of global funds,” he said. “Given the rapid increase in cross-border flows, we need to reduce friction wherever possible to ensure the smooth flow of funds in and out of Australia.”