Australia a strategic ‘Treasure Island’ for Investment

With the world grappling with heightened geopolitical uncertainty, economic volatility, and a US President seemingly intent on a global trade war, this present a strategic opportunity for Australia—if policymakers and business leaders are able to seize the moment.

This perspective is echoed by members of the Abundium Multinational Business Council, which  brings together  leaders of the foreign-owned business sector operating in Australia. A sector that generates the nation approximately $1.3 trillion in economic activity.

These  business leaders have a unique perspective on the opportunity for Australia in this time of global uncertainty. On a daily basis they are working and negotiating with colleagues and stakeholders around the world, whilst simultaneously making critical business decisions based on local realities.

A Strategic ‘Treasure Island’ for Investment 

Multinational CEOs believe that Australia potentially stands to benefit from global disruption, but success will require proactive economic and policy decisions. Several factors strengthen Australia’s investment appeal:

• A lower Australian dollar enhances export competitiveness and attracts foreign capital.
• Our  trade deficit with the US has seen Australia on the lighter scale of Trump’s threatened tariffs.
• Geographic proximity and trade partnership with high-growth Asian markets remains a strategic advantage.
• Australia serves as a low-risk, high-relevance test market for global products and services.
• Strong governance, legal frameworks, and political stability bolster investor confidence.

This outlook is not without challenges. Trade tensions between major economies increase the likelihood of new disruptions to global supply chains, while a weaker Australian dollar raises the cost of imports and pressures local revenues and profits from a global headquarters perspective.

The promise of stronger returns for foreign capital investment in the US is also a threat. Pro-business policy settings, increasingly competitive corporate tax rates, productivity levels far beyond Australia’s, and a strong economic outlook with a rising US dollar in a market 16x larger than ours makes for a strong US business case to foreign investors.

Australia’s economic reliance on China also remains a key consideration. However, a shift towards diversified supply chains is already underway. Many global companies have been pursuing a ‘China+1’ strategy, investing in nations such as Vietnam, the Philippines, India, and Malaysia to enhance supply chain resilience. This presents an opportunity for Australia to position itself as a regional anchor for investment and trade.

Growth Is Not Optional 

For multinational businesses, standing still in 2025 is not an option. Over recent years, they have focused on cost optimisation and margin preservation—leaving little room for further cuts. The imperative now is investment and expansion, leveraging global expertise, innovation and brand power combined with local savvy and drive to navigate the economic turbulence.

A potential escalation in US-China trade tensions may accelerate a shift in investment across the Asia-Pacific region. Australia’s stable economic and legal environment makes it an attractive destination for companies seeking to diversify operations away from China, positioning the nation as a strategic ‘treasure island’ in the global investment landscape.

Policy Priorities for Australia’s Economic Trajectory 

While multinational leaders see strong investment potential in Australia, they emphasise the need for forward-thinking policy decisions to sustain economic momentum. Key priorities include:

• Interest Rate Relief: Lowering interest rates is essential to stimulating economic growth, easing cost-of-living pressures, and encouraging business investment. Addressing supply-side constraints and moderating demand will be crucial in enabling the Reserve Bank to act.
• Innovation and Technology Investment: The federal government must take cues from the US, where strategic investments in AI and emerging technologies have driven productivity gains over the past two decades.
• Regulatory and Tax Reform: Simplifying regulatory frameworks and ensuring a globally competitive tax environment will be critical to attracting long-term investment. Australia is currently ranked a low 32nd in the world on corporate tax competitiveness.
• Labour Market and Population Growth Strategies: With GDP growth stagnating and migration levels declining, policies that support skilled migration and workforce productivity will be vital.

With a new government to be in power from May, addressing these economic imperatives should be central to whichever party wins office. Business leaders representing foreign-owned enterprises are calling for policy certainty that supports investment and long-term growth.

Confidence in 2025, But Urgency Required 

Encouragingly, multinational business leaders remain optimistic.  The vast majority (85%) expect top line growth in 2025, with only 6% predicting a decline. This confidence is underpinned by expectations of easing interest rates, consumer spending recovery, and access to global capital.

Yet, optimism must translate into action. Australia is in a rare position to leverage its economic stability and regional standing to attract investment amid global uncertainty. Failure to do so risks losing capital to more aggressive markets like the US, putting long-term growth at stake.

Bipartisan support is needed to implement policies that lower inflation, stabilise the currency, and foster business innovation. If executed correctly, Australia can emerge from this period of volatility not just unscathed, but stronger—an essential anchor in an unsettled global economy.

Written by Rich Hirst.
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