China made a weighty soft power foray into this country with the state visit of Premier Li Keqiang but Australian innovators and entrepreneurs must get off their collective backsides into gear to take advantage of the warm fuzzies emanating from the trip.
Premier Li’s five-day visit, the first by a Chinese premier in 11 years, included attending an AFL footy game ahead of the Port Adelaide and Gold Coast clash to take place in Shanghai in May.
“We think Australia’s small fry compared to other countries, but that (five day visit) is a big commitment from a senior leader,” says Helen Sawczak, National CEO of the Australia China Business Council.
Premier Li’s trip here comes when the global power structure is wide open following the election of President Donald Trump and his subsequent destruction of the Trans Pacific Partnership trade deal of which Australia was to have been a signatory.
With the TPP no more, China has been keen to help broker its own Regional Comprehensive Economic Partnership which would see the creation of a 16 member trading bloc that would include all 10 members of the Association of South East Asian Nations (ASEAN) along with Australia, New Zealand, Japan, Korea, India and China.
That is 3.4 billion people and 30 per cent of global GDP.
While the RCEP is the big picture, Premier Li’s visit also saw the furthering of some purely Sino-Australian tech initiatives that included both countries agreeing to stump up $6 million each over three years to the next funding round for six Joint Research Centres, under the existing Australia-China Science and Research Fund.
The funding will focus on advanced manufacturing, resources and energy, medical technologies and pharmaceuticals.
Just before Premier Li’s visit here, China said it would not push ahead with tougher, cross border e-commerce regulations, a major boost for local companies that sell to China through online channels.
However, Australia’s attempt at hooking into the massive Chinese technology market could all come to naught unless local entrepreneurs, finance people and researchers get their heads around how China works and begin some heavy engagement with our northern neighbour.
“What we have got here is an opportunity which is Australia’s to lose,” says Andrea Myles, a self-confessed ‘China geek’ who is CEO of the China Australia Millennial Project (CAMP) and has just led a five day innovation study tour into China with a group 100 business-tech keen millennials.
“The mindset in China is far more innovative than it is in Australia,” says Ms Myles.
“We look like a sleepy little town, but we think we are up there with the big dogs. But we are not.”
She believes Australia’s startup and innovation community is ‘asleep at the wheel’ when it comes to the China opportunity.
“Our startup community has very little understanding of the Chinese context. It doesn’t know how to connect with China, it is reticent to bring on Chinese co-founders and it’s is reticent to seek Chinese capital. It just doesn’t know how to do it.”
On the plus side, Ms Myles the Chinese view of Australia is essentially positive with this country associated with ‘happiness and health’, a perception which has seen local health pill makers Swisse and Blackmores make inroads into China.
Australia is also viewed by Chinese as ‘green, clean and safe’ according to Ms Myles who believes we should push our capabilities in food, medicine and clean technology.
Ms Myles’ tour finished in a Shanghai jazz bar after a whirlwind expedition of rapid growth Chinese outfits including the famed Alibaba e-commerce giant.
The study tour was the beginning of a 100-day program that will see Chinese and Australian teams create ventures that will be appraised in June by a panel that includes a group of eight Chinese investors.
“These teams will design and build new businesses together around 15 different industries that we’ve determined will determine the future of the China/Australia business relationship,” said Ms Myles.
“The way we determine those is we took a look at what is in Australia’s national interest and China’s five year plan and the overlap is what is going to characterise the next 20 plus year stretch of innovation and entrepreneurship.”
Premier Li and Australian Prime Minister Malcolm Turnbull were party to a discussion on technology, innovation and commercialisation at a business summit involving the Australia China Business Council last Friday.
“R&D spending is huge in China right now,” says Ms Sawczak, who believes Australia needs to bring China in closer on the conception of good ideas here.
“We need deeper exchange with respect to that and that means not just companies but also universities.”
Ms Sawczack cautions that China entrepreneurship operates at very high speed and Australian need to be ready for the extra pace.
“Things happen in China very quickly. If there are opportunities they tend to embrace them very quickly.”