In a speech to the Korea-Australia Finance Forum held on Tuesday, FSC chief executive John Brogden said the free trade agreement is a good outcome for services generally, but the financial services sector in particular.
Mr Brogden said lower barriers to trade will “enable Australia to focus on the sectors where we have a comparative advantage, increase trade in these and drive economic growth”.
He said it will also place Australia in closer proximity to growing markets and therefore provide a substantial opportunity for Australia to grow its financial services exports.
“Financial services in Asia are undeveloped,” said Mr Brogden.
“While it has 60 per cent of the world's population, it has just 13 per cent of global funds under management.”
He also said Australian and Korean investors will have access to a greater range of financial services products.
“For Korean consumers in pension funds this means access to Australia’s expertise in equities and infrastructure,” he said.
“While Australia’s market for financial services is already one of the most open and well regulated in the world, free trade agreements provide the opportunity to broaden the range of products available to Australian consumers.”
Mr Brogden also believes the free-trade agreements, particularly bilateral ones, help raise Australia’s profile in the partner country.
He said the agreement “improves on previous bilateral free-trade agreements with other countries and builds opportunity for further enhancements”.
“The size of Australia’s superannuation system is already larger than the capitalisation of the Australian Securities Exchange,” said Mr Brogden.
“While Australia’s market for financial services is already one of the most open and well regulated in the world, free trade agreements provide the opportunity to broaden the range of products available to Australian consumers.”
Mr Brogden said the greatest barriers to trade in financial services are not technical and legal, however, but those relating to culture and relationships.
He said the Korea-Australia Finance Forum is an example of the “kind of relationship building both industries need to do if we are to turn the free trade agreement into greater financial services trade and investment”.
