The Hon Martin Pakula MP - travel report - China, 27 May - 3 June 2019

*The above costs are not final and complete

Purpose of travel

The purpose of my travel to China was to meet with a number of significant government and business stakeholders and leaders in Hong Kong, Nanjing and Shanghai that cut across all my portfolio areas. During this visit, I took part in activities that celebrated the 40th year anniversary of Victoria's longest standing sister-state relationship with Jiangsu province and also led a Victorian delegation of 16 sports and sports technology companies visiting China to coincide with the Federal Government's Festival of Australia activities across the country.

Benefits of travel to the State of Victoria

China stands as Victoria's largest two-way trading partner with the relationship continually evolving and strengthening. The engagements undertaken throughout my program allowed me to establish new connections in market and build on already established friendships and partnerships. It also allowed me to promote doing business with Victoria, to Chinese business leaders and champion the interests of Victorian exporters on a global stage.

Hong Kong

In Hong Kong I met with the senior executives from the Hong Kong Jockey Club to discuss the quarantine restrictions on horses entering Australia from Hong Kong and the potential for an increase in the number of Victorian race meetings simulcast locally in Hong Kong. The meeting also allowed me to understand more about the club's new racecourse and training facility at Conghua in mainland China and opportunities for Victorian firms to support the growth of the industry.

I also met with representatives from Monash University in Hong Kong, to learn about the Monash Technology Transformation Institute (MTTI) in Shenzhen. The recent partnership Monash University has sealed is a $100 million, 10-year deal to use Chinese venture capital investment to develop its research and bring new products, mainly pharmaceuticals and medical devices, to China's multi-billion-dollar consumer market. The Institute is a new not-for-profit research institute focused on research and development (R&D) activities in the Pingshan District of Shenzhen Municipality. I will continue to track the progress of this landmark partnership and further explore how it supports the economic and employment uplift potential in the Monash Technology Precinct in Melbourne.

In Hong Kong I attended the AustCham Australia China Business Awards to acknowledge the success of Australian and Chinese businesses. I presented the award for Sustainability, Diversity and Social Responsibility to Melbourne born business Swisse, and was also encouraged to witness the Melbourne Symphony Orchestra take the award for Business Innovation, Creative Industries and the Digital Economy. Importantly, this event was hosted by the Chief Executive of Hong Kong, Ms Carrie Lam who afforded me the opportunity to meet and discuss opportunities for how Victorian businesses can participate in developments in the Greater Bay Area of China.

Nanjing

My visit to Nanjing was to commemorate the 40th anniversary of sister-state relations with Jiangsu province. The visit coincided with a friendly basketball match between the National Basketball League's (NBL) newest franchise, South East Melbourne Phoenix who played their first competitive game against the Jiangsu Dragons. During the game, I met with the Director-General of the Jiangsu Provincial Sport Bureau to explore how sport can form a strong platform to further strengthen the Victoria - China friendship. During the game, I was also interviewed by the Yangtse Evening Post with a daily circulation of 300,000; and Jiangsu TV with a monthly reach of 590 million viewers who reported on the game and the Victorian trade mission.

Prior to the game, I, together with representatives from the NBL and South East Melbourne Phoenix, were hosted by the Deputy Director-General of the Jiangsu Provincial Sport Bureau, to discuss collaborative opportunities between Victoria and Jiangsu.

Whilst in Jiangsu, I also met with Nanjing headquartered Chinese conglomerate Suning, who has vast and diverse business interests across several industries including innovation, e-commerce and sport, to discuss ways in which Victoria and Suning may be able to partner and provide more opportunities for Victorian businesses to access the China market. This builds off the existing relationship in which Suning has participated in a number of Victorian inbound trade missions and subsequently imported a number of Victorian products across food and beverage categories. I also encouraged Suning to consider Victoria as a location, should it consider opening an Australia New Zealand office to source more products from the region.

Shanghai

I met with executives of the Zhangjiang Hi-Tech Park to learn about their recent activities and developments and share insights and experiences in relation to the development of priority precincts. We established that areas of focus between the two jurisdictions should focus on biotech and medical technologies; and artificial intelligence.  

I met with the Director General of the Shanghai Sports Administration and jointly witnessed the signing of a Letter of Intent on Sports Exchange between Shanghai and Victoria. The agreement will see the Shanghai Administration of Sports and Global Victoria work in partnership to enhance economic and cultural ties through the sports exchanges, trade missions and assistance in growing the sports sectors for the benefit of both jurisdictions.  

I led a Victorian trade delegation of 21 delegates representing 16 organisations who participated in a Sports and Sports Technology trade mission from 27 May to 2 June 2019. The companies that participated in the mission had expertise in event management, stadium design, performance, injury management and technology. Each member of the delegation gained at least two qualified leads. Examples of key outcomes to date include:

• A company with expertise in developing learning programs for physical education has secured a contract to develop a curriculum for soccer, which will be running in kindergartens in Shanghai. They are also in negotiation with international schools in Beijing to deliver physical education workshops for teachers using their unique methodology.
• A company with expertise in the design and construction of elite hybrid/natural grass has found the China market very receptive of their product, sees excellent long-term potential and are currently in negotiations for a local partner to establish a joint venture. 
• A sports tech company focussing on events, education and e-commerce, has secured additional partnerships and has also generated further business by scoping sports technology conferences to be delivered in China.

Based on the evaluations received to date from participating Victorian companies, immediate outcomes have been valued at $70,000 and anticipated export sales of $10,370,000 over the next 24 months. Note that export sales traditionally take 12-24 months to be fully realised post mission.

I delivered the opening address at the AustCham Shanghai Sports Summit in Shanghai and also joined participants at the networking event. My address to over 100 stakeholders highlighted Melbourne's strength as a world class sporting city that continues to attract the world's top athletes, providing a great ecosystem for growth and development in the sports technology sector. The event was attended by senior Chinese stakeholders involved in the sports sector in Shanghai, demonstrating the potential collaboration opportunities for both China and Victoria in the sector.

I delivered the keynote speech at the Global Victoria Doing Business in China Seminar which was attended by over 150 guests. The event provided an opportunity for Victorian businesses to hear first-hand industry insights from high profile speakers from China and Australia, on how to grow their business in one of the world's largest economies.

Key speakers included the Hon John Brumby AO, former Premier of Victoria and National President of the Australia China Business Council; Mr Andrew Bassat, St Kilda Football Club President and Co-Founder of Seek; various notable businesses engaging with China including the AFL and Swisse and a number of Global Victoria's key partners including Austrade and AustCham Shanghai.

Following the seminar, the Governor of Victoria and I co-hosted the Friends of Victoria business networking event for around 150 guests including Victorian business members of AustCham Shanghai, Victorian alumni, members of the Victorian trade delegation and key Shanghai stakeholders.

The seminar was followed by a friendly basketball game between South East Melbourne Phoenix and the Shanghai Sharks, held at Jiao Tong University, that was well-attended. Both this game and the game in Nanjing continued the NBL's strong program of engagement it has been cultivating with the Chinese Basketball Association (CBA) over the past five years, given the significant commercial opportunities it sees in Chinese basketball. Both games were televised by China's PPTV and promoted on the NBL's and Phoenix's digital channels.

I launched the Victorian Racing Club's (VRC) International Engagement program in China aimed at increasing visitation from China to the Melbourne Cup Carnival, developing sponsorship prospects and showcasing Victoria's fashion sector in China. The event, which also incorporated the launch of the Fashions on the Field campaign for China, was attended by 46 Chinese media outlet companies who have so far generated 100 media clippings and articles appearing across multiple Chinese print and digital platforms, including Shanghai City TV, which has a reach of 250 million viewers.

I participated in a number of AFL focused events including: the St Kilda Chairman's Breakfast and AFL Gala Dinner supporting the third AFL match ever played outside of Australia for premiership points; and the first involving a Victorian club.

The AFL Gala Dinner was attended by 550 Australian and Chinese guests and showcased Victorian food and beverage products including, Bulla Dairy Foods ice cream and Four Pillars Gin.

The St Kilda versus Port Adelaide game attracted a crowd of approximately 10,000 people and a TV audience of 3.9 million (3.7 million Chinese viewers), a 10 per cent increase on 2018, according to the AFL.
 
The St Kilda Football Club has made a three-year commitment to playing in the Shanghai round. To explore business opportunities, it ran a five-day corporate program for more than 60 businesses, around half of which were Victorian including Lion Dairy & Drinks Australia, which launched its Victorian-made Farmers Union yoghurt brand into Shanghai.  

Next Steps / Follow Up

• The department will continue to work closely with all Victorian businesses that participated as a sports trade mission delegate. As an immediate follow up, Global Victoria is inviting up to 15 executives from the global sports industry to Melbourne to further develop trade opportunities with Victorian companies during a Melbourne Sports Technology Week in August 2019 to be delivered in partnership with the Australian Sports Technology Network and Victorian company Vumero. The Melbourne Sports Technology Week program will include business matching activities, pitching sessions from Victorian companies, masterclasses by leading sports tech companies and attendance at the Vumero's Australia Sports Analytics and Technology Conference.
• The department will continue to work with the AFL (including St Kilda Football Club), NBL and VRC as they continue to drive their China engagement strategies and develop new networks and audience engagement.
• The Victorian Government Trade Investment (VGTI) office in Shanghai will work with the Shanghai Sports Administration to develop a plan for delivering on the direction of the Letter of Intent. This will include opportunities to share experiences around best practice in the delivery of sports activities, community engagement and trade.
• Build on connections established in Hong Kong to deliberately target trade opportunities in the growing market of the Greater Bay Area.
• The Victorian Government will continue to engage with Jiangsu province around a series of activities to acknowledge and celebrate the long standing 40th anniversary of the sister-state relationship.