ACBC Green Channel. Net Zero – Faster, Together.

It’s a well-known fact that Australia has some terrific credentials in science, technology and innovation. Australia’s tech start-up community has evolved in the last 10 years to see local heroes such as Atlassian, Canva and AirWallex achieve success in global markets.

However, when it comes to commercialisation, it is the European and US markets that have been the focus for investors and innovators. Yet, we know that the Asian markets offer the most potential for future growth. So why is there not a greater focus on the Asian markets?

In this month’s note we provide some ACBC Green Channel perspectives and observations on why we should be looking more close to home.

The market at present

Local venture capital (VC) firms, such as Sydney-based Blackbird Ventures, have grown their capital under management through significant returns from early start-up investments in companies such as Canva. Australia’s venture capital market is still small globally, but the start-up sector is maturing. As a recent start-up funding report by Folklore Ventures shows, investment into Australian start-ups surpassed $10 billion in 2021. Investor appetites are shifting from FinTech and SAAS to CleanTech and Environmental solutions. The future looks bright for Australia’s impact entrepreneurs.

However, the Folklore Venture report also reveals Australia’s blind spot. Data highlights that the majority of investor interest is still domestic market focussed. Maybe born of our Anglo-origins, there is a distinct lack of Asian capital in the market. 80% of larger, later-stage VC investments, (PE and M&A) comes from US and European markets.

This, despite the fact that our neighbouring Asian markets are growing dynamically with global capital seeking investment opportunities in the region. Of note also is the fact that in the lead up to, and following, the coming into effect of the Regional Comprehensive Economic Partnership (RCEP) at the beginning of this year (of which Australia and China are members), the flow of investments between many of the Asian participating countries has increased.

Despite Australia’s strong Trade relationship with Asia, Australia’s Department of Foreign Affairs and Trade reports that less than 10% of Australia’s outbound investment is going into Asia.

Half of that outbound investment (only 5% of total) is going into China – our $250B trading partner!

Of particular interest from Chinese Ministry of Commerce data, inbound investment to China into 2021 was powered by strong investment in services & technology.

China’s VC market also continued to expand, seeing a 50% YOY growth in 2021 compared to the previous year, to now be valued at US$130 billion.

Looking ahead – through a Green Channel lens

The disconnect between how Australia and how many in other parts of the world view the “Asia opportunity”, is stark.  The new and emerging challenges for business in the region are clear, but at the same time, the opportunities in the region continue to grow.

China is no longer just about plastic toys and cheap exports. Its cities, universities and industrial bases are in a major transition. Entire industries are undergoing massive decarbonisation. And it is the new entrepreneurial class that is driving this dynamic, multi-sector, industrial & consumer market to its Net Zero future.

ACBC’s Green Channel initiative has been formulated to help Australian companies understand not only the nature of the changes that are occurring right now but to actively support and facilitate commercial and business opportunities in those areas that make sense to do so. To join our Green Channel Insights, please subscribe here.

New Partnerships. New Activations:

To support our Members, ACBC’s Green Channel has entered into a number of new partnerships to address this knowledge gap and highlight the new opportunities. Over the next few months, we will be releasing more details on our new programs and outcomes.

Contact us if you want to participate in our Green Channel programs.

1. CEO – Green Channel Business Roundtables

Kicking off in December last year, our program of CEO Business Leadership Roundtables will continue to bring together Australian and Chinese companies to discuss opportunities for collaboration on Climate Change.  We’ll be doing this at a senior business level with further high-level dialogues, and also at our Branch level with dialogues at a sister state/territory and province level.

2. “Collaborations on Climate” – Green Channel White Paper

Green Channel Foundation Partner, King & Wood Mallesons, is supporting the program by authoring insights and observations in an inaugural White Paper on “Collaborations on Climate” with our Members. KWM’s Global Research team is currently talking with Australian and Chinese businesses to document successful Case Studies.

Contact us if you would like the KWM Green Channel team to consider your business for this.

3. Green Channel Benchmark Survey

This month we launch our inaugural Green Channel Member survey which will provide us with baseline information to measure awareness and progress in the year ahead.

Please Click Here to participate in the survey. (Closes March 31)

4. Green Channel – ANU “Decarbonisation” Roundtables

ACBC is hosting a series of roundtable events across Australia in 2022 with the Australian National University. Attended by distinguished Academics and Industry leaders, these roundtables are an opportunity to discuss the implications of decarbonisation for Australia and China, helping to identify future economic opportunities under fast-developing policy settings. Please Click Here to join our Green Channel events notification database.

5. Green Channel – Impact Summit

ACBC has entered into a formal partnership agreement with NSW Chapter Member, ImpactX. ACBC Green Channel will be a Presenting Partner at their Hainan & Sydney events in 2022.

The Haikou ImpactX summit in July runs over three days (20-22 July) and includes curated workshops and events and an international line-up of leading Climate Impact speakers, including:

• China’s Special Advisor on Climate Change
• Hainan Province’s Director the Department of Ecology and Environment
• President of the World Business Council for Sustainable Development
• CEO of World Energy Council
• Chief Economist, Asian Infrastructure Investment Bank

To participate in ACBC’s Green Channel Hainan activities, please contact us here.

Net Zero Faster, Together

ACBC’s Green Channel has been established with the specific purpose of improving Australian businesses’ understanding of the opportunities for collaboration on initiatives to address the Climate Challenge and to facilitate the accelerated uptake of projects.

We invite you to participate in our ACBC Green Channel program in any of the following ways:

• As a Member, and you can contribute with market knowledge and networks – Contact Green Channel Working Group
• As a Member, is you would like to attend the ACBC Green Channel ImpactX Summit – Contact ACBC’s Green Channel Secretariat
• Not a Member, but keen to contribute – Contact ACBC to join as a Branch Member
• A Member and want to step up as Green Channel Foundation Partner – Contact ACBC’s Green Channel Foundation Partners Program Secretariat

Thank you for your continued support as an ACBC Member.

We look forward to sharing with you our future Green Channel developments.

Anthony Coles, ACBC National Board Member. Chair, Net Zero Working Group (WeChat  +61401434545)