“The question is: how can we use the different elements of Western Australia where you have a comparative advantage to create and reinforce mutual advantage across sectors?” he said.
Mr Donelly was joined by a panel of leaders from several sectors to discuss ways of building the international competitiveness of West Australian industry.
Keynote speaker and CBH Group Chief Executive Officer, Jimmy Wilson, emphasised the significant opportunities open to Australia in the grain growing industry.
“We are very well positioned in Australia to play into South East Asia, North Asia, India…there are over three billion people in that area," he said.
However, Mr Wilson also drew attention to the increasing threat of competition in export markets.
“Black Sea countries have now passed 100 million tonnes of exports into our contestable markets. As a result, the wheat price has halved in real terms since 1990,” he said.
In order to compete, Mr Wilson said, Australian growers have to focus on cost and productivity improvements.
“Twenty-five per cent of our growers can grow at a lower cost than the average grower in Russia and the Ukraine. One of the opportunities we have is to get all growers to be as efficient as that top 25 per cent," he said.
“We need to leverage the information and understand how that top 25 per cent of growers are doing it and give that information to some of the others.”
In the panel discussion, StudyPerth Executive Director, Phil Payne, drew attention to the opportunities for growth in the higher education sector.
“International education is responsible for $45 billion in export revenue for the Australian economy, so it is big business for Australia,” Mr Payne said.
“It is also big business for Western Australia, but it is nowhere near as big as it should be. We have 55,000 international students studying in Western Australia from 146 different countries and it is responsible for about 1.9 billion dollars of export revenue.
“However, over the last ten years when national enrolments in international education have increased by almost 40 per cent, the enrolments in Western Australia have increased by just over four per cent. This means that western Australia has got a market share of about 5.9.
"If we had our demographic share it would be about 10.9 and if it was based on GDP it would be 14.9 per cent so whatever way you look at it, Western Australia is not performing anywhere near as well as it should be in international education.”
Legend Media Group Chair, Bronwyn Barnes, highlighted similar opportunities for Western Australia in the international arts and media space.
“China is now the largest film market in the world. China is currently building 2100 cinema screens a month, which means they are essentially replicating the entire Australian cinema industry every six weeks,” she said.
“You are starting to see China become more enthusiastic about film product from countries outside the US. We see that as a two-edged opportunity. It is a chance to deliver under coproductions and a chance to further tap into the enormous market potential in China.”
Taking a wider perspective, Mr Donelly spoke about Western Australia’s potential for growth.
“Western Australia has some great natural advantages in terms of resources and scale and natural proximity to the growing Asian middle class. There will be three billion people in the Asian economy within the next 20 to 30 years. That is incredible potential for Western Australia.”
Mr Donelly cautioned against taking these advantages for granted.
“I think the diversification strategy the government has recently announced is a really good thing. It means you can continue to make the most of some of the natural advantages in some of those really big industries but also develop a little bit of resilience if something goes wrong in one of those industries," he said.
"If the Chinese economy faulters iron ore will go through the floor so it really is important to have other opportunities available.”
Mr Wilson also highlighted the importance of diversification and cross-sector collaboration.
“There is a risk of going backwards on trade that we have to be wary of. Going forward we need to make sure we support our biggest export industries but equally we need to get into tourism,” he said.
Further on this point, Mr Payne discussed the ways tourism and the higher education sector can benefit from each other.
“Victoria runs a ‘graduation season’ where the family and friends of international students are encouraged to come to Melbourne to celebrate a range of events and activities. They spend more in that week or two than the Melbourne Cup and Spring Carnival combined. It is a very lucrative area for the Victorian economy,” he said.
Mr Payne spoke about the value of replicating this approach with a ‘welcome season’ for friends and relatives of international students.
The panel also spoke about how government can foster export growth.
Reflecting on the early success of her company attracting international interest, Ms Barnes said that “what hooked it from a business perspective was absolutely the support of the Western Australian government. That we had the WA government standing alongside us to say ‘we will welcome you to come and work in Western Australia: what can we do to help you come here?’
Ms Barnes said that “there is a real opportunity for the state to take a more coordinated, long term, strategic approach to supporting the creative industry in Perth. There is a market there so it would make sense to see some investment in that area.”
Using the seafood market as an example, Mr Donelly spoke about the significant opportunities presented by free trade agreements.
“When tariffs on rock lobster were at 15 per cent the industry sold basically nothing. Last year tariffs went down to three per cent and we sold more $600 million worth of seafood and this year tariffs have gone to zero and we are on track to go well above $600 million by the end of this year,” he said.