February 19, 2016

The NAB ACRI Australia-China Business Index: Barriers to business engagement.

This excerpt from the NAB ACRI Australia-China Business Index examines barriers to engagement between Australian and Chinese businesses.

The first-ever report comparing attitudes of Chinese and Australian business leaders towards bilateral engagement was conducted by NAB and the Australia-China Relations Institute (ACRI) at the University of Technology Sydney.

This excerpt from the report synopsis examines what is inhibiting further bilateral engagement.

A domestic focus is a bigger barrier to increased engagement for Australian firms.

acri graph


In Australia, the biggest impediment to higher engagement with China is having a domestic focus. Other key impediments for engaged firms include the lack of transparency of the Chinese legal system and protection of their intellectual property (IP). The China-Australia FTA is not a game-changer for these impediments.

More small firms saw the protection of their IP and inadequate resources to enter the market as significant barriers. Large firms were more concerned about the regulatory environment, bureaucracy and payment/ settlement issues, while medium sized firms saw corruption as a bigger inhibitor.

For firms with no engagement, the biggest impediment outside of having a purely domestic focus was their lack of knowledge of the Chinese market.

More small firms with no engagement also identified their limited knowledge of the Chinese market, corruption and competition as important factors, while more large firms said the regulatory environment was too complex.

In contrast, for engaged Chinese firms having a domestic focus ranks much lower as a barrier to increased engagement. Instead they nominate concerns about institutional, language and cultural barriers, too much competition, and the complexity of the regulatory environment (including foreign investment laws).

For Chinese firms with no engagement, the biggest impediment outside of having a domestic focus was concerns around institutional, language and cultural barriers and limited knowledge of the Australian market.

Source: NAB ACRI Key bilateral insights from the inaugural Australia-China Business Engagement Index Synopsis. Pages 2 and 4

Read the full index findings here.