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Australia sees growth in international trade of engineering services

A REPORT by Engineers Australia has confirmed the increasing international competitiveness of the Australian engineering services sector, but it also suggests that many obstacles still exist to expanding the trade.

Claire Svircas
Australia sees growth in international trade of engineering services

The report, Global Reach – Supporting the Professional Mobility of Australian Engineers, examines mutual recognition agreements and trade opportunities, and includes survey feedback from Australian engineers competing on the world market.

The report shows that as part of Australia’s export of professional services, engineering services are growing and now account for 20% of Australia’s exports.

The most commonly traded engineering services are consultancy work typically consisting of design, planning, procurement, field services and project management, according to the report.

The report also found that most Australian firms with international operations, which account for 60% of the field, spend a significant proportion of their time in undertaking project management and design and documentation work.

However, it was found that some of the major impediments to expanding Australia’s competitiveness still include mutual recognition of qualifications, as well as nationality and residency requirements, restrictions on access to foreign government contracts, and restrictions on foreign direct investment and ownership.

The report also suggests that while advanced communications allow many consulting services to be delivered online, the actual presence of Australian engineering expertise onsite in other countries remains as the main form of service delivery.

It was also identified that there are major impediments to the international provision of professional services, such as the non-recognition or limited acknowledgment of home country education, qualification or accreditation.

Other major non-tariff barriers to services trade include nationality and residency requirements; restriction on incorporation; restricted eligibility for contracts including government procurement contracts; and prohibition on advertising.

Restrictions on foreign direct investment and ownership and requirements pertaining to a minimum number of local staff were also identified as the most common barriers by Australian service providers.

The study found licensing requirements were identified as a significant non-tariff barrier to the export of engineering services by nearly 15% of survey respondents, with the United States, the European Union, China and Canada the most cited countries for removal of licensing barriers for the engineering profession.

Even in Australia there is no one single regulatory regime governing the engineering profession and no national legislative restrictions on the use of the title “professional engineer” as engineers do not need to be a member of a professional association in Australia in order to offer engineering services to the public.

Other than in Queensland, the engineering profession operates under a self-regulatory system with two voluntary registration schemes – membership of Engineers Australia as a Chartered Professional Engineer, or registration on the National Professional Engineers Register. Most states and territories in Australia also have registration or licensing regimes for engineering practitioners in the building and construction industry, with differing education and experience requirements.

The report also concluded that the true value of trade in engineering services to the Australian economy is essentially unknown due to problems in the collection of services statistics, and until this is improved it will be difficult to identify areas where trade in professional services – including engineering – is under-performing, or to measure or predict the impact on trade volumes for changes in policy and regulation.

Engineers Australia said on the back of this report it would continue to work with the Australian Government to get a better deal for Australian engineers under existing and future trade agreements.

The report can be accessed at www.engineersaustralia.org.au

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