Sebastian Stevens, BDO Property & Construction Leader and Andres Reith, BDO Property & Construction Partner, continue to take part in this year's The Property Congress – a property forum which unites national and international property leaders to engage in an industry dialogue on property drivers, trends and hot spots.
Here are more insights from the day:
Developing relationships with Chinese partners should be a priority for Australian businesses, says Dr. Geoff Raby
Former Australian Ambassador to China, Dr. Geoff Raby used his international keynote speech at this year’s Property Congress to drive home an important message: Australian businesses should invest in developing relationships with their Chinese counterparts and recognise that their interests are frequently aligned.
Dr. Raby, who lives in China, said the country’s economy is showing weaker growth and that this is in part due to the ‘cyclical’ property sector, which is currently seeing an oversupply of stock. He also described the changing political situation in China, where former Mayor of Beijing Liu Qi is working to restore and reinvigorate the Communist Party.
Dr. Raby is used to navigating the complexities of doing business in China and said it remains a land of great opportunity for Australia, offering advantages for those pursuing inward or outward investment.
He said Australian property is seen as low-risk by Chinese investors, many of whom have experienced historic political insecurity and poverty at home and are looking for a ‘safe harbour’ for their money. He added that although there are restrictions in regard to moving capital out of China, the Chinese are ‘creative’ at circumventing them.
Around half of high net worth Chinese prefer their families to live outside China, according to a recent survey1 cited by Dr. Raby. He also referred to growing global sentiment that suggests London is the most preferred location globally for property investment, but Australia is their number one choice in the Asia-Pacific region, which explains the ‘mini Chinese gold rush’ into Australian property.
Dr. Raby concluded his address with a lesson: the key to succeeding in China is taking a long-term view. “Work on relationships with business partners and align your interests. Operate ethically in an environment which often challenges your capacity to do so,” he said.
1 The Rise of the Global Citizen, Barclays Wealth & Investment Management: