Mr Tim Pallas MP – travel report – Canada and the United States of America, 7 to 21 July 2024

*The above costs are not final and complete

Purpose of travel

This mission promoted Victoria as a stable, well-governed jurisdiction to key North American stakeholders, and provided the opportunity to promote Victoria’s economic credentials, strengthen trade and investment relationships, and engage with government counterparts to advance Victoria’s international engagement priorities.

Travel was undertaken to Canada and the United States (US) to:

• Meet with government ministers in Canada’s Ontario Province and the US State of Connecticut to promote Victoria as an investment destination, collaboration partner, and to gain insights into economic policy approaches and interventions.
• Meet with a range of Canadian and US companies to promote Victoria as an investment destination.
• Gain insight into the changing global economic and geo-political climate, capital markets and investment markets.
• Meet with large existing and prospective investors in bonds issued by Treasury Corporation of Victoria (TCV) to promote issuance by TCV; gain insight into global fixed income issuance strategies and investor appetite; and support effective and efficient delivery of the state’s funding requirements.

Benefits of travel to the State of Victoria

Canada

Canada is an increasingly important source of foreign direct investment in Victoria with two-way merchandise trade valued at $1 billion in 2022-23. Canada is the eighth largest source market of foreign direct investment (FDI) in Victoria.

The benefits of travel to Canada included:

Toronto

• Meetings with Canadian firms McCain Foods, Pliteq and Hydrostor, provided an opportunity to discuss:
  • McCain’s existing manufacturing operations in Victoria and new business developments.
  • Pliteq’s new business entry to Victoria.
  • Hydrostor’s long-duration energy storage technology and interest in investing in Victoria.

• Undertaking discussions with Moog Defence and Aerospace (based in upstate New York) centred on their existing Australian operations in Victoria and partnership and growth opportunities. Moog is eager to expand manufacturing operations in Victoria.
• Visiting Xanadu Quantum Technologies provided an opportunity to discuss development and use cases for quantum computing technology; inspect Xanadu’s micro-processor manufacturing and assembly operations; and discuss their interest in the Australian market.
• Visiting the MaRS (Medical and Related Sciences) Discovery precinct provided an opportunity to evaluate the support provided to the Toronto start-up sector, and capture insights and learnings for Victoria.
• Meeting with Ontario’s Minister for Economic Development and Minister for Finance provided an opportunity to discuss the province’s approach to industry policy and investment attraction, and economic trends and fiscal strategy. Toronto is the third largest city in North America and presents opportunities for Victoria given the shared characteristics.
• Meeting with the Ontario Financing Authority, as part of the meeting with the Minister for Finance, also provided an opportunity to discuss the province’s debt issuance strategy and its approach to investor diversification.
• Meetings with Brookfield Asset Management, Canadian Pension Plan Investment Board (CPPIB), Healthcare of Ontario Pension Plan (HOOPP), Ontario Municipal Employees Retirement System (OMERS), Ontario Teacher’s Pension Plan (OTPP) and Royal Bank of Canada (RBC) provided an opportunity to understand developing trends in asset management and debt capital markets, and to hear of Canadian pension funds’ ongoing interest in investing in Victorian infrastructure and bonds issued by TCV. Insights were shared on environmental, social and governance (ESG) issues relating to both investment and debt issuance

United States of America

The US is Victoria’s largest source of foreign direct investment valued at $3.34 billion in 2023-24 according to fDi Markets – and second largest trading partner, with total two-way merchandise trade in 2022-23 valued at $17.3 billion. Victoria’s trade and investment relationship is supported by the Australia-United States Free Trade Agreement and diplomatic partnerships including the Quad and AUKUS. The US is also the largest bond market in the world.

The benefits of travel to the US included:

New York

• Visiting Salesforce, a global US tech company, headquartered in New York, provided an opportunity to better understand the applicability and practical use cases for artificial intelligence, and the potential for significant AI-related investment in Australia.
• Meeting with IND Technology, a Victorian-based technology business, now exporting to the US, provided an opportunity to understand IND’s business growth in North America, new business development opportunities including in the US, Victoria and other markets, and insights for Victoria’s trade facilitation services.
• Discussing geo-political and economic developments with the Australian Consul-General in New York, and further opportunities for in-market collaboration in the US.
• Meetings with ratings agencies Moody’s, Standard and Poor’s and Fitch Ratings provided an opportunity to reinforce Victoria’s progress against its fiscal strategy, in support of current credit ratings. Standard and Poor’s also provided an update on their global macroeconomic outlook.
• Meetings with Alphabet/Sixth Street, JP Morgan, Macquarie Asset Management and Blackstone provided an opportunity to understand recent trends with respect to artificial intelligence deployment; ESG investing; to receive updates on the US economy, geopolitics, and the global macroeconomy.
• Additionally, the meeting with JP Morgan provided an opportunity to update investors in TCV bonds on the state’s fiscal strategy and issuance activities and understand appetite from investors for TCV issuance in both Australian dollars and other currencies.

Connecticut

• Meeting with the Treasurer of the State of Connecticut and business leaders in Hartford and New London provided an opportunity to promote Victoria’s defence sector credentials and explore policy interventions that may have applicability in Victoria.
• Site visits to the Connecticut Center for Advanced Technology and Grasso Tech provided insights into how industry-led short-form training is supporting development of key industries and firms, specifically submarine and defence component manufacturing.

Boston

• Meeting with Ginkgo Bioworks, a contract synthetic biology company, at their headquarters and research facilities in Boston provided an opportunity to discuss the company’s interest in the Asia Pacific and Australian markets, including potential investment.
• Visiting Lockheed Martin Energy’s Labs near Boston provided the opportunity to inspect their long-duration energy storage development and manufacturing and to discuss their interest in investing in Australia and Victoria.
• Meetings with Wellington Investment Management and State Street provided further elaboration of the look ahead for the American and global economies.

Next steps/Follow up

Canada

• Continue to work with McCain Foods, Pliteq and Hydrostor regarding their operations and business development and investment opportunities in Victoria.
• Facilitate further quantum computing collaborations between Victorian and Canadian organisations.
• Consider further collaboration opportunities to provide support for Victorian companies to expand into Canada and the broader North American market.
• Consider key insights from Ontario as part of Victoria’s economic and industry policies’ development and investment attraction efforts.
• Consider key insights and strategic choices of Canadian investors in the context of Victorian investment funds.
• Follow-up meetings with Ontario Financing Authority in relation to debt issuance and investor relations strategy.
• Follow up meetings with prospective investors regarding opportunities to invest in TCV bonds.

United States of America

• Continue to work with Moog Defence, Salesforce, Ginkgo Bioworks and Lockheed Martin regarding their operations and business development and investment opportunities in Victoria.
• Continue to engage with IND Technology on how the Victorian Government can support the company’s growth.
• Facilitate further artificial intelligence collaboration and investment opportunities and assess the overall set of opportunities for the establishment of an AI Centre of Excellence in Victoria.
• Deepen collaboration with the State of Connecticut, specifically related to defence, aerospace and submarine building and related supply chains.
• Reflect key insights from industry-led training approaches in Victoria’s training system.
• Follow up meetings with prospective investors regarding opportunities to invest in TCV bonds.
• Reflect key insights from economic outlook presentations and capital markets discussions in Victoria’s economic forecasting, economic policy set and funding activities.
• Explore further opportunities in key sectors for government and the broader economy ahead of the Economic Growth Statement later in the year.