Migration levels are increasing across the world. According to the Brookings Institution, the number of international migrants has rose from 75 million in 1960 to close to 250 million today.
A paper by the institute suggests that the migrant diaspora around the world presents opportunities for many developing countries. Their diasporas could provide business networks, sources of knowledge and capital.
For a country like Australia with a large migrant population, this also presents opportunities which Australian businesses should be alerted to and make use of. As the report notes, “the existence of strong business networks between countries is an important stepping stone to overcome non-tariff trade barriers or other market failures hindering cross-border trade and investment”.
The Brookings research states that migrants residing abroad can play a crucial role in lowering the costs of doing business in between their home and current countries. Evidence shows that migrants play an important role in fostering trade through the creation of networks. For Australian businesses marketing products and services overseas, migrants can help to overcome communication and language barriers. Migrants are also more likely to have knowledge of the regulatory environment in both countries, which is crucial for establishing bilateral business dealings.
Human interaction is critical for the transmission of knowledge and technologies. The Brookings paper notes that migrants can play a crucial role as carriers of knowledge across borders. Brookings cites an example as the very successful wine industry in South Africa. The industry was originally established by French Huguenot refugees expelled from France by King Louis XIV. These migrants brought with them production and merchandising know-how and developed the now highly-sought-after varieties of South African wines.
Australia has a large base of migrants and Australian businesses would be well advised to ensure they make use of the knowledge and networks that this group offers.
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