Welcome to the Fear and Greed Business Interview. I'm sure Ailma, my guest today, is one of the most prominent business leaders in Australia over recent decades. Nicholas Moore spent more than thirty years at Macquarie Group, including a decade as CEO. In twenty twenty two, he was asked by the Prime Minister to become Australia's Special Envoy for Southeast Asia. The purpose of the role is to lead the development of a national strategy for greater trade and investment between Australia and Southeast Asian nations. It's an enormous opportunity for Australian business and one that we need to move quickly on before we miss out. Nicholas Moreo, Welcome to Fear and Greed.

Welcome to the Fear and Greed Business Interview. I'm sure Ailma, my guest today, is one of the most prominent business leaders in Australia over recent decades. Nicholas Moore spent more than thirty years at Macquarie Group, including a decade as CEO. In twenty twenty two, he was asked by the Prime Minister to become Australia's Special Envoy for Southeast Asia. The purpose of the role is to lead the development of a national strategy for greater trade and investment between Australia and Southeast Asian nations. It's an enormous opportunity for Australian business and one that we need to move quickly on before we miss out. Nicholas Moreo, Welcome to Fear and Greed.

Thanks Sean, thank you very much for having me.

Thanks Sean, thank you very much for having me.

I've spoken about the fact that Australia's foreign direct investment is higher into New Zealand than it is into Southeast Asian nations. I'm not quite sure whether that's still the case, but I'm sure the trend is still the same. Why is that? Why do we go to New Zealand not these incredibly populous countries above us.

I've spoken about the fact that Australia's foreign direct investment is higher into New Zealand than it is into Southeast Asian nations. I'm not quite sure whether that's still the case, but I'm sure the trend is still the same. Why is that? Why do we go to New Zealand not these incredibly populous countries above us.

I think that's a good question, But I think the bigger question, Sean is when you look at both of them. I think Southeast Asia is three percent, New Zealand's four percent. Obviously, it's a very small percentage of our overall foreign direct investment. In our foreign investment overall, which is growing now, most of that is going to the major market and has historically, so it's going to the United States of course, biggest market in the world. It's going to Europe, it's going to North Asia, Japan, Korea, and China. So I think it's just a question of scale that obviously the bigger capital markets will attract the most money. So we use it as an interesting juxtaposition New Zealand being of course small, Southeast Asian being very large. But the way we'd like to think about Southeast Asia is not as a comparative to New Zealand, of course, but to those bigger markets, because we know Southeast Asia is our second largest trading partner from a global growth viewpoint, seems to be growing either the fastest in the world or the second fastest after India, depending which set of numbers you assume. So what we'd like to be having people think about South theaset as is, comparing it to the investment opportunities in India, in Europe and in North America, and to be thinking that it is going to be a very substantial part of the world in the future. It is today, but it will continue to be.

I think that's a good question, But I think the bigger question, Sean is when you look at both of them. I think Southeast Asia is three percent, New Zealand's four percent. Obviously, it's a very small percentage of our overall foreign direct investment. In our foreign investment overall, which is growing now, most of that is going to the major market and has historically, so it's going to the United States of course, biggest market in the world. It's going to Europe, it's going to North Asia, Japan, Korea, and China. So I think it's just a question of scale that obviously the bigger capital markets will attract the most money. So we use it as an interesting juxtaposition New Zealand being of course small, Southeast Asian being very large. But the way we'd like to think about Southeast Asia is not as a comparative to New Zealand, of course, but to those bigger markets, because we know Southeast Asia is our second largest trading partner from a global growth viewpoint, seems to be growing either the fastest in the world or the second fastest after India, depending which set of numbers you assume. So what we'd like to be having people think about South theaset as is, comparing it to the investment opportunities in India, in Europe and in North America, and to be thinking that it is going to be a very substantial part of the world in the future. It is today, but it will continue to be.

So why haven't we done it yet? Is it the capital markets issue? The fact that whether you're raising money there, whether the rule of law there is different, culturally is different. Why is it though, given how close it is to us, we haven't gone there before?

So why haven't we done it yet? Is it the capital markets issue? The fact that whether you're raising money there, whether the rule of law there is different, culturally is different. Why is it though, given how close it is to us, we haven't gone there before?

Now? I mean, you know the seawan that Australian businesses tend to be domestically focused. Australia has been a very strong economy. We've had good economic growth, we've had good demographics supporting the growth here. So there's been a lot of opportunities on shore. And when people go offshore, obviously successful companies will look to go offshore. The natural place to go again is the bigger market. So you are going to look at the US markets for many times larger than Australia, or you look at the UK, or you look at Europe, they're just bigger markets. So historically Southeast Asia has been a lot smaller and obviously we're talking about at least ten different countries, depending how you define them, in the region, but ten different countries, each one of them of course small compared to the scale of the United States or the scale of the uk is historically. But of course as time goes on, we're seeing the growth in absolute size of these markets becoming bigger and bigger, and the growth rates of these countries obviously, as I mentioned before, becoming very attractive indeed, So I think it's a question of as time goes on, these markets will become more attractive, and we've seen that in terms of the rest of the world investing in the region. So if we go back in terms of the chants that we put in the pack, you can see Australian investment in the region was about three and a half percent, it went up to about seven and now it's come down recently to about three and a half three point two. The rest of the world was at a similar level to us, and it's actually now at seven percent, So I think that's a good measure. The rest of the world is putting seven percent of their foreign direct investment in the region and we're putting half of that. So I think it's a good measure in terms of the relative opportunities there. It's a good look looking to see what the rest of the world, the United States, the Europeans, the Canadians, what are they investing there? And we're certainly under investing and so that's a clear fact. And the question is why is that the case given it's on our doorstep. Now. I think the international companies have scale benefit. A lot of the companies were investing there are bigger than our companies, particularly in the sectors that are seeing a lot of investment, including things like manufacturing in the region. So we're seeing a lot of growth from around the world, particularly with the China plus one story of people seeking to hedge their bets. They're not putting all their money in China. They're actually building capacity in the region as well, and that includes Chinese companies. A lot of the investors in the region, of course, are Chinese companies. So I think it comes down to the nature of our businesses. The size of our business is relative to the rest of the world. But there's no doubt it hasn't been on people's agenda. When I was at Macquarie and the other companies have been involved in. We naturally look to the bigger markets rather than looking to Southeast Asia. Mcquarie was active across the region and still is, but it wasn't the first place that you would look at. Now I think the opportunities there just are so compelling. Today we are seeing more and more interests from Australian companies actually still being up to invest in the region.

Now? I mean, you know the seawan that Australian businesses tend to be domestically focused. Australia has been a very strong economy. We've had good economic growth, we've had good demographics supporting the growth here. So there's been a lot of opportunities on shore. And when people go offshore, obviously successful companies will look to go offshore. The natural place to go again is the bigger market. So you are going to look at the US markets for many times larger than Australia, or you look at the UK, or you look at Europe, they're just bigger markets. So historically Southeast Asia has been a lot smaller and obviously we're talking about at least ten different countries, depending how you define them, in the region, but ten different countries, each one of them of course small compared to the scale of the United States or the scale of the uk is historically. But of course as time goes on, we're seeing the growth in absolute size of these markets becoming bigger and bigger, and the growth rates of these countries obviously, as I mentioned before, becoming very attractive indeed, So I think it's a question of as time goes on, these markets will become more attractive, and we've seen that in terms of the rest of the world investing in the region. So if we go back in terms of the chants that we put in the pack, you can see Australian investment in the region was about three and a half percent, it went up to about seven and now it's come down recently to about three and a half three point two. The rest of the world was at a similar level to us, and it's actually now at seven percent, So I think that's a good measure. The rest of the world is putting seven percent of their foreign direct investment in the region and we're putting half of that. So I think it's a good measure in terms of the relative opportunities there. It's a good look looking to see what the rest of the world, the United States, the Europeans, the Canadians, what are they investing there? And we're certainly under investing and so that's a clear fact. And the question is why is that the case given it's on our doorstep. Now. I think the international companies have scale benefit. A lot of the companies were investing there are bigger than our companies, particularly in the sectors that are seeing a lot of investment, including things like manufacturing in the region. So we're seeing a lot of growth from around the world, particularly with the China plus one story of people seeking to hedge their bets. They're not putting all their money in China. They're actually building capacity in the region as well, and that includes Chinese companies. A lot of the investors in the region, of course, are Chinese companies. So I think it comes down to the nature of our businesses. The size of our business is relative to the rest of the world. But there's no doubt it hasn't been on people's agenda. When I was at Macquarie and the other companies have been involved in. We naturally look to the bigger markets rather than looking to Southeast Asia. Mcquarie was active across the region and still is, but it wasn't the first place that you would look at. Now I think the opportunities there just are so compelling. Today we are seeing more and more interests from Australian companies actually still being up to invest in the region.

We'll get to that at the moment. Stay with me, Nicholas. We'll be back in a minute. I'm speaking to Nicholas More, Australia Special Envoy for South East Asia. So where are those opportunities that you're talking about for Australian companies.

We'll get to that at the moment. Stay with me, Nicholas. We'll be back in a minute. I'm speaking to Nicholas More, Australia Special Envoy for South East Asia. So where are those opportunities that you're talking about for Australian companies.

Well, we can see companies are active already across the region. So when we look at typical companies, you'd expect to be active in agricultural related companies. So we have you know, we should say it as well, just been talking about investment. In terms of the destination for our exports and our imports. The region is our second largest trading partner today, second only to China, so it is a substantial trading partner and so we're seeing a lot of Australian companies involved in that trade who've got operations in the region, so obviously agricultural exports. They're active in the region, continuing to be active in the region, looking at further processing both in Australia and in the region. In terms of commodities, mineral commodities are power, coal, gas and of course increasingly renewables. We're seeing increasing levels of activity, particularly in the renewable space. A lot of people in the region. Interestingly, a lot of the regional players have invested in Australian renewable projects. So companies are Malaysia, Indonesia and the Philippines whore invested in Australia and Thailand have invested in Australian renewable projects. One because they look like a good investment, but secondly to get the expertise because their renewable challenge is obviously their economy is bigger, so I was going to say equal greater, but greater than ours. So it's a great opportunity. So they're looking at what they can learn from arts and simply our developers, our developers, including my former shop of Macquarie, are looking at neewable investments across the region. Other areas of interest where Australia has been strong include projects and construction lightens historically. Of course the old Latens was very active across the region, but Australian infrastructure investors are actually looking across the region because the model many of us have looking at what's happening in the region is it's very similar to what we saw in North Asia. So if you think of the Second Wall after the Second World War in the fifties, we saw the industrialization of Japan, then we saw Korea, then we saw Taiwan, and then of course most recently we've seen China. So the model there of that export lead growth, that focus on infrastructure development domestically manufacturing, domestically, building up skills through education. All that sort of element we're seen playing out near in South Asia. So again from an Australian viewpoint, obviously it's selling into that manufacturing base, selling into that development of the infrastructure base, which means investment, but also means things like engineers. So our engineers and service providers, our lawyers have been active in terms of that project management and of course education. So education is our largest non commodity export to the region, our largest services export. I think we have over two hundred different educational institutions active in the region and increasingly on the ground. So the number one university in Malaysia, certainly, we would say is Monash University. So Monash University is a number one university we would claim in Malaysia. In Vietnam, r MIT is the number one university in Vietnam and there's two campuses there. When I took on this role, one of the other countri's ambassadors came to me and the first question he asked is why can't we have an r MIT in my country. Now r MIT has other campuses now developing across the region. So the countries are very focused. Again you know, I referred to them in the North Asian model of actually building up the skills of the individuals. They're very focused on building the capabilities within their people that they can actually embrace this growth opportunity in our universities, and not just our universities, but our other vocationally focused institutions. It's their grade opportunity building campuses there. They obviously have a lot of students from Southeast Asia here in Australia at the moment being educated and a very large alumni. We think over two hundred and fifty thousand leading business figures in the region have been to Australian universities. And of course we have the added benefit of over a million people from the region living in Australia, so we have that very strong personal to person connection. So from a services viewpoint, you know, we are a strong services many. Education is very important number one export, number one in terms of where development's happening. But as I mentioned before, if you go down through things like financial services, if you're with things like lawyers, if you look at things like accountants, you know, even the Society of Accountants are very active in the region. So across all these different areas that our economy is strong and we see opportunities in the region. So in our report we highlighted ten different sectors which we think had great potential. Which are you know worth reflecting on all of them, but we probably don't have the time. The only one that I haven't mentioned on the way through with the governments taken quite a bit of action is the digital side of our economy. Obviously, the world we're living in is rapidly a digital world, as we were talking about earlier, Shure and we have established landing a landing pad for austraand and digital businesses already in Indonesia, and as part of the government's action coming out of the report, we've now opened that in ho Chi Min City as well, and so actually having digital companies looking not just at the big markets in the United States and Europe, but very much looking at what's happening in our region now. As I said, there's ten different sectors renewable. We can go through them all, but all of them are are very very interesting.

Well, we can see companies are active already across the region. So when we look at typical companies, you'd expect to be active in agricultural related companies. So we have you know, we should say it as well, just been talking about investment. In terms of the destination for our exports and our imports. The region is our second largest trading partner today, second only to China, so it is a substantial trading partner and so we're seeing a lot of Australian companies involved in that trade who've got operations in the region, so obviously agricultural exports. They're active in the region, continuing to be active in the region, looking at further processing both in Australia and in the region. In terms of commodities, mineral commodities are power, coal, gas and of course increasingly renewables. We're seeing increasing levels of activity, particularly in the renewable space. A lot of people in the region. Interestingly, a lot of the regional players have invested in Australian renewable projects. So companies are Malaysia, Indonesia and the Philippines whore invested in Australia and Thailand have invested in Australian renewable projects. One because they look like a good investment, but secondly to get the expertise because their renewable challenge is obviously their economy is bigger, so I was going to say equal greater, but greater than ours. So it's a great opportunity. So they're looking at what they can learn from arts and simply our developers, our developers, including my former shop of Macquarie, are looking at neewable investments across the region. Other areas of interest where Australia has been strong include projects and construction lightens historically. Of course the old Latens was very active across the region, but Australian infrastructure investors are actually looking across the region because the model many of us have looking at what's happening in the region is it's very similar to what we saw in North Asia. So if you think of the Second Wall after the Second World War in the fifties, we saw the industrialization of Japan, then we saw Korea, then we saw Taiwan, and then of course most recently we've seen China. So the model there of that export lead growth, that focus on infrastructure development domestically manufacturing, domestically, building up skills through education. All that sort of element we're seen playing out near in South Asia. So again from an Australian viewpoint, obviously it's selling into that manufacturing base, selling into that development of the infrastructure base, which means investment, but also means things like engineers. So our engineers and service providers, our lawyers have been active in terms of that project management and of course education. So education is our largest non commodity export to the region, our largest services export. I think we have over two hundred different educational institutions active in the region and increasingly on the ground. So the number one university in Malaysia, certainly, we would say is Monash University. So Monash University is a number one university we would claim in Malaysia. In Vietnam, r MIT is the number one university in Vietnam and there's two campuses there. When I took on this role, one of the other countri's ambassadors came to me and the first question he asked is why can't we have an r MIT in my country. Now r MIT has other campuses now developing across the region. So the countries are very focused. Again you know, I referred to them in the North Asian model of actually building up the skills of the individuals. They're very focused on building the capabilities within their people that they can actually embrace this growth opportunity in our universities, and not just our universities, but our other vocationally focused institutions. It's their grade opportunity building campuses there. They obviously have a lot of students from Southeast Asia here in Australia at the moment being educated and a very large alumni. We think over two hundred and fifty thousand leading business figures in the region have been to Australian universities. And of course we have the added benefit of over a million people from the region living in Australia, so we have that very strong personal to person connection. So from a services viewpoint, you know, we are a strong services many. Education is very important number one export, number one in terms of where development's happening. But as I mentioned before, if you go down through things like financial services, if you're with things like lawyers, if you look at things like accountants, you know, even the Society of Accountants are very active in the region. So across all these different areas that our economy is strong and we see opportunities in the region. So in our report we highlighted ten different sectors which we think had great potential. Which are you know worth reflecting on all of them, but we probably don't have the time. The only one that I haven't mentioned on the way through with the governments taken quite a bit of action is the digital side of our economy. Obviously, the world we're living in is rapidly a digital world, as we were talking about earlier, Shure and we have established landing a landing pad for austraand and digital businesses already in Indonesia, and as part of the government's action coming out of the report, we've now opened that in ho Chi Min City as well, and so actually having digital companies looking not just at the big markets in the United States and Europe, but very much looking at what's happening in our region now. As I said, there's ten different sectors renewable. We can go through them all, but all of them are are very very interesting.

Indeed, we are out of time but very quickly. The impact of Donald Trump and his potential policies, Does it make much of a difference at this point.

Indeed, we are out of time but very quickly. The impact of Donald Trump and his potential policies, Does it make much of a difference at this point.

Well, I think we're dealing with a very very big, long term trend here in terms of where the region is at. As I said, putting it into historical context, we know the North Asian very story very well. Australia's prosperity has been built very much on what's happening in North Asia. Now we're seeing it happen really in our neighborhood and Australia is very keen to be part of it. We know it's going to be a great success. We will benefit from it in Australia will benefit from what's happening in the region. It's a question of how much more we can benefit from it than we did with Aphasia. Now all the scientire we can benefit a lot more. If you think about where Japan was in nineteen fifty, you know we don't have the diaspora, the Japanese diapa in Australia. We don't have the Australian universities that we have operating across the region. We don't have the alumni, we don't have the people, the people links. They're not our second largest trading partner. So all of those different elements suggest that we will we will have a great future in the region. What we're all about is making sure that that future can be as big and exciting as the potential is laid out before us.

Well, I think we're dealing with a very very big, long term trend here in terms of where the region is at. As I said, putting it into historical context, we know the North Asian very story very well. Australia's prosperity has been built very much on what's happening in North Asia. Now we're seeing it happen really in our neighborhood and Australia is very keen to be part of it. We know it's going to be a great success. We will benefit from it in Australia will benefit from what's happening in the region. It's a question of how much more we can benefit from it than we did with Aphasia. Now all the scientire we can benefit a lot more. If you think about where Japan was in nineteen fifty, you know we don't have the diaspora, the Japanese diapa in Australia. We don't have the Australian universities that we have operating across the region. We don't have the alumni, we don't have the people, the people links. They're not our second largest trading partner. So all of those different elements suggest that we will we will have a great future in the region. What we're all about is making sure that that future can be as big and exciting as the potential is laid out before us.

Nick, thank you for talking to Fear and Greed.

Nick, thank you for talking to Fear and Greed.

Thank you, Sean.

Thank you, Sean.

That was Nicholas More, Australia Special Envoy for Southeast Asia. This is the Fear and Greed Business Interview. Join us every morning for the full episode of Fear and Greed. Daily business news for people who make their own decisions. I'm Sean Elmer. Enjoy today

That was Nicholas More, Australia Special Envoy for Southeast Asia. This is the Fear and Greed Business Interview. Join us every morning for the full episode of Fear and Greed. Daily business news for people who make their own decisions. I'm Sean Elmer. Enjoy today