Services Sector Shows Continuing Growth

LATEST AUSTRALIAN BUSINESS NEWS

The Australian service industry sector, including retail, has shown continuing growth over the last recording period.

An index of Australian service industry performance rose to a six month high in July due to an increase in business at hotels, restaurants and retail outlets. The Australian Industry Group – a major employer association – has issued its latest data based on industry orders, sales, deliveries and inventory levels. The latest index shows that there has been a 2.6% in these base measures for the month June to July 2005. The Group has said that from the index it can ascertain that there is a continuing expansion of service industry activity.

Retail trade in particular has shown an increase of 1.3%, in the face of what was expected to have been a slow period, due to relatively mild winter weather and some apparent levelling off of overall consumer spending. The overall level of Australian retail spending was $17.2billion for the month of June.

For information on this article, or on any other aspect of the Australian economy or business opportunities available, please email me.

David

david.taylor@agarcarlyon.com

Be Aware of Australia's Tough Quarantine Laws

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An international student and a first-time traveller have both learned an expensive lesson: — trying to break Australia’s tough quarantine rules doesn’t pay. The two cases, heard in Brisbane, resulted in fines totalling more than $14,000 for Quarantine and Customs breaches at Brisbane International Airport. The travellers also now have criminal records. In the first case, a university student who has been studying in Australia for three years tried to smuggle 1.5 kilograms of sausages from China after a trip home to visit his family. Quarantine officers discovered the sausages in his suitcase during X-ray inspection. Sausages could carry animal diseases such as foot and mouth into Australia — and could potentially devastate Australian native animals and its agriculture and export industries.

It’s been estimated that an outbreak of foot and mouth disease would cost $450 million in control measures, and would cause a $13 billion loss to Australia’s export earnings.

The second passenger, a 52-year-old woman visiting relatives in Australia, brought in a range of goods, also from China. Quarantine officers found the items including a live bamboo plant, apples and chicken meat, when her bags went through X-ray inspection. The goods could have brought with them insect pests, a range of plant diseases and bird flu, putting at risk Australia’s $30 billion-a-year agriculture export industries as well as its wildlife and environment.

For information on this article, or on any other aspect of the Australian economy or business opportunities available, please email me.

David

david.taylor@agarcarlyon.com

Consumers Regain Confidence

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Consumer confidence has come back strongly in Australia with a 7.6% rise recorded in August. This follows on from a slight dip in confidence reported in July – according to the Westpac Bank/Melbourne Institute’s latest Index of Consumer Sentiment. There had been concern about the possibility of the Reserve Bank of Australia (RBA) increasing interest rates, but over the past months that risk has been diminished. It is only last week that the Governor of the RBA stated that a rise in rates over the remainder of 2005 was unlikely.

For information on this article, or on any other aspect of the Australian economy or business opportunities available, please email me.

David

david.taylor@agarcarlyon.com

For sale - Two Major Government Entities

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Telecommunications. The Australian Government is to move to the next stage of preparing for a sale of its majority holding in Telstra – Australia’s leading (formerly monopoly holding) - telecommunications company. The Government’s holding is worth around $30billion and should be of interest to major international telecommunications companies and related entities. The advice from the Telstra Scoping Study was that an appropriate return could be achieved, but that it would be dependent on a number of future variables, including:-

• overall market conditions,
• expected demand for Telstra shares,
• Telstra’s performance,
• the outcomes of the new CEO’s operational review, and
• the implementation of regulatory changes.

Medical Insurance. The Australian Government has decided to review its ownership of Medibank Private Limited – a major private health insurance company - and will update a scoping study into the possible sale of the company. As with the previous scoping study completed in 2003, the update will examine the operation and structure of Medibank Private, analyse the industry and policy environment in which it operates, and consider options for the Commonwealth's future ownership of the company. The updated scoping study will also examine issues such as the nature of its corporate structure and the effect of a potential sale on consumers, members and employees of Medibank and other stakeholders. It is expected that the scoping study update will be completed by the end of this year.

For information on this article, or on any other aspect of the Australian economy or business opportunities available, please email me.

David

david.taylor@agarcarlyon.com

More Business Opportunities - Automated Defence Vehicles

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Australia's future military operations will be supported by forces of robots and unmanned vehicles which will be highly integrated and controlled by defence personnel from a distance, Defence Minister Robert Hill said today. Speaking at the opening of the Amazing World of Science event in Canberra today, Senator Hill said the Government was investing more and more on research and development of unmanned vehicle technology for use in future operations and for surveillance purposes.

"These new intelligent and largely autonomous systems will in the future be able to carry out hazardous tasks traditionally reserved for warfighters which will reduce exposure and risks to Australian Defence Force personnel," Senator Hill said. "This will be a huge leap in capability for our Defence Force. I envisage that in the future unmanned battlespace vehicles will be deployed in fleets to gather information, conduct surveillance, sweep for mines, defuse bombs and carry out a range of dangerous tasks. "The autonomous systems will be able to provide the ADF with increased access to its areas of operation, especially in hostile and difficult terrain.

"This advance in technology has the potential to increase the operational effectiveness of our troops and enhance surveillance capabilities while reducing risk to personnel and reducing the cost of operations." Research into such autonomous vehicles is being undertaken by the Defence Science and Technology Organisation (DSTO) under its Automation of the Battlespace Initiative (ABSI). "This is a long range research program to enhance the ADF's capabilities by dramatically increasing the autonomy, performance and affordability of these unmanned vehicles," Senator Hill said. "Trials so far have demonstrated that these autonomous vehicles can work together in cooperative way to complete assigned tasks. "DSTO is exploring the concept of expendable autonomous vehicles which will be inexpensive to manufacture and easy to repair." In time these vehicles will carry integrated communications and other capabilities linking them together and with their controllers. Senator Hill said advances in computing power, electronics, sensors, miniaturisation and smarter software has made it possible to raise automation to a new level.

For information on this article, or on any other aspect of the Australian economy or business opportunities available, please email me.

David

david.taylor@agarcarlyon.com

US Company Wins Australian Defence Contract

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The Australian Federal Government has chosen the US company Gibbs & Cox as the preferred designer for the Australian Navy's Air Warfare Destroyers (AWDs) - one of Australia's largest and most complex Defence projects worth up to $6 billion. Gibbs & Cox now joins a team made up of ASC Shipbuilder Pty Ltd, who has been selected to build the AWDs, and Raytheon Australia, selected as the Combat System-System Engineer. Gibbs & Cox, a United States based company, was chosen through a competitive tender evaluation process that also included German company Blohm + Voss and Spanish company Navantia. The selection of Gibbs and Cox as platform designer now completes the team whose responsibility it is to deliver the project. The Government made the decision after accepting the recommendation of the Source Selection Board on the basis that Gibbs & Cox offered a superior bid in terms of value for money. All three companies presented competitive bids and showed themselves to be very competent naval ship designers. Bids were evaluated against a wide range of criteria.

The Gibbs & Cox evolved design will now compete with an Australianised version of Spain's existing F100 ship design, and will be further considered by the Government as part of the next phase of the project. The construction of the Air Warfare Destroyers will be one of the most significant shipbuilding projects undertaken in Australia to date, and will provide enormous opportunities for Australian industry and its partners. The Government has provided $455 million towards the current phase of the project which includes further design work, workforce skilling, initial infrastructure investment and facilities construction. The ship will be interoperable with the United States and other Coalition partners.

For information on this article, or on any other aspect of the Australian economy or business opportunities available, please email me.

David

david.taylor@agarcarlyon.com

New Legislation Governs Surveillance of Employees

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The obligations of employers in the State of New South Wales – of which Sydney is the capital - relating to electronic surveillance in the workplace are now governed by the Workplace Surveillance Act 2005, which was assented to on 23 June 2005. The Act attempts to strike a balance between an employee’s right to privacy and the genuine concern of employers to protect their workplaces from unlawful activity. The Act regulates the unauthorised covert monitoring of employees at work, whether via cameras or video, computer input or output (such as the sending or receiving of emails, or accessing of internet sites) or tracking devices (such as global positioning system devices).

If an employer wants to commence camera, computer or tracking surveillance, for example, by monitoring an employee’s email traffic or accessing of internet sites, it must provide at least 14 days’ written notice, or any shorter period agreed by the employee. If the notice requirements are not complied with, the surveillance is considered to be “covert surveillance”. Covert surveillance is prohibited unless it is undertaken in accordance with a “covert surveillance authority” issued by a Magistrate. A covert surveillance authority will only be issued for the purpose of determining whether or not an employee is involved in unlawful activity at work.

For information on this article, or on any other aspect of the Australian economy or business opportunities available, please email me.

David

david.taylor@agarcarlyon.com

Australian Naval Ship Building Opportunity

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The Australian Federal Government has approved the first stage of the $2 billion Amphibious Ships project which will provide the Australian Navy with a world class capability to deploy land forces on operations. The project will provide the Navy with new amphibious ships to be used on operations and assistance in policing or military operations. Readers with interests in defence shipbuilding should contact Agar Carlyon (see email address below) to obtain more information.

The ships to be built include the Spanish Navantia ship of approximately 27,000 tonne and the French Armaris Mistral ship with additional troop carrying capability at approximately 22,000 tonnes. Each ship will preferably have the ability to transport up to 1000 personnel, have six helicopter landing spots and provision for a mix of troop lift and armed reconnaissance helicopters. It will also be able to transport up to 150 vehicles including the new M1A1 Abrams tanks and armored vehicles. Each ship will also be equipped with medical facilities, including two operating theatres and a hospital ward.

A Request for Tender will be released in the second quarter of 2006. The Government's preference is to see the ships built in Australia but this will depend on the Australian industry’s ability to demonstrate it can deliver the project at a competitive price. The Government has given first pass approval to the project and committed $29.8 million towards the Design Development Phase of the project.

The tender documentation will allow bidders to:

* Form teaming arrangements;

* Submit fixed price bids;

* Provide innovative solutions to improve price and schedule, and;

* Bid through life support solutions.

For information on this article, or on any other aspect of the Australian economy or business opportunities available, please email me.

David

david.taylor@agarcarlyon.com

Infation Set to Remain Steady

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The Reserve Bank of Australia (RBA), in its latest quarterly statement has made its clearest indication yet that a further interest rate rise this year is most unlikely. Just as US rates have edged up a further 0.25%, the RBA has indicated that the chance of a rate rise is equal to that of a rate drop.

At the same time, the RBA said that in its view the Australian economy was growing at a reasonable rate and that inflation was likely to be in its acceptable range of just 3% in 2006. At the same time the Reserve said that in 2007 inflation will remain steady - also at 3%.

For information on this article, or on any other aspect of the Australian economy or business opportunities available, please email me.

David

david.taylor@agarcarlyon.com