By CMA CEO Carl Gibson

The complementary medicines industry is proud to make a difference to the preventive health agenda, building a more sustainable health system for all Australians.

As the peak industry body for the complementary medicines industry, Complementary Medicines Australia (CMA) represents stakeholders from across the value chain including; brand sponsors, manufacturers, raw material suppliers, distributors, consultants, retailers, allied health professionals and educators. I’m proud to say that we promote appropriate industry regulation and positive Government policies to ensure consumers have access to complementary medicines of the highest quality which make a difference to their lives every single day.

It is part of our role of CMA to submit recommendations on behalf of industry to the Treasurer for inclusion in the 2019-20 Budget.

The Australian industry is recognised as a premium brand in the complementary medicines sector, stemming from our strict manufacturing standards and Australia’s well-deserved reputation for a clean and well-regulated environment for food and medicines. 

 

Supporting the Growth of Australian Exports  

Growth in the Australian market expected to continue, increasing innovation-rich manufacturing and providing a significant contribution to our country’s exports. Trade with international markets is crucial for the long-term prosperity of the Australian complementary medicines industry. Our products are well recognised as world leading in the complementary medicines around the world, thanks to strict quality and safety manufacturing standards and Australia’s global reputation for quality and safe products and its trusted regulatory institutions.

Australian products are increasingly popular in overseas markets, particularly in Asia and the Western Pacific region. Our industry has the ability to continue its positive growth trajectory, growing our high-skilled manufacturing sector, boosting Australian jobs across the industry in product manufacturing, as well as stimulating scientific evaluation and research.   

 

Expanding middle-class consumers

The Asia-Pacific region is the largest market for complementary medicines products in the world. Given the ageing population and growth of the middle class, demand for Australia’s high-quality complementary medicines is expected to remain very strong. By 2030, the Asia-Pacific region will have 3.2 billion middle-class consumers. Great demand is expected in the areas of health and aged care, natural preventive care and high-quality food products.

 

Number one in China!

Australia has now overtaken the USA as the number one importer of complementary medicines into China. The opportunities offered by the Chinese market are significant, with the health food market alone – which includes vitamins and minerals, herbal extracts and Traditional Chinese Medicine – currently valued at US$30 billion and projected to grow by 10 per cent every year until 2025.

The Chinese Government has made health a priority, with the Healthy China 2030 vision being central to all policy-making. The demand for complementary medicines is also proliferating in China due to an increasingly health-conscious population taking a keen interest in their health and wellbeing.

 

Made in Australia

Consumers in Asia care about the quality of products, and the ability to use a consistent logo and branding in the form of the Australian Made logo offers a competitive advantage in international markets. Thanks to CMA, complementary medicines manufactured and tested in Australia can rightfully claim Made in Australia and use the coveted logo. It represents a very real industry advantage to manufacturing plants, central to our industry, allowing us to retain and protect our Australian identity. The potential cost of not being able to use the Made in Australia logo to our industry could have been $1.2 billion dollar export market to China, future export opportunities, and a workforce that supports a 4.9 billion dollar industry. 

The Australian complementary medicines industry is asking that the Government ensures to continue to support manufacturers and provide a level of certainty for businesses, in the consistent application of Country of Origin and Australian Made provisions.

 

 Trade Liberalisation

CMA strongly supports the growing number of free trade agreements to which Australia is a signatory and the ever-increasing focus on helping to address ‘behind the border’ issues. Continued trade liberalisation will present sizeable opportunities for the Australian complementary medicines industry as the sector is well positioned to compete for emerging opportunities.

The Indian market presents an incredible export opportunity. Indian consumers look to natural health supplements as an element of their health care choices; India has a long history of such usage through Ayurveda medicine. The Indian natural products market was estimated at approximately US$4 billion in 2017 and is expected to grow at 21 per cent CAGR to US$10 billion by 2022.

A market of over 1 billion people, India is experiencing a rise in demand for nutritional supplements amongst the upper and middle classes, resulting from a rise in lifestyle diseases and a subsequent focus on health and nutrition. Higher disposable incomes, access to information, and the strong reputation of Australian products to be high quality and ‘clean and green’ is facilitating growth.

 

Australian health supplements, vitamins and minerals and sports foods 

Some challenges need to be overcome before the Australian complementary medicines industry can fully benefit from the opportunities offered by the Indian market, on which we will continue to focus. India presents a significant opportunity in the future for the Australian complementary medicines sector. CMA proposes that the Australian Government progresses the Australia-India Comprehensive Economic Cooperation Agreement, including tariff reduction and clarification around the application of GST on health products, to support Australian businesses in our sector to benefit from the future market opportunities offered by India.

India also presents an opportunity for exporting Australian ingredients for high-end products, as there is a demand for high quality and unique ingredients such as tea tree oil, manuka honey, whey protein concentrate and more. Exporting Australian ingredients for high-end products is also a great opportunity since there is a demand for high quality and unique ingredients such as tee tree oil, manuka honey, whey protein concentrate etc.

 

Targeted funding for AgriFutures

AgriFutures (formerly RIRDC) identifies and nurtures research, innovation and collaborative efforts to support new and emerging opportunities for rural industries. This includes support of the emerging Australian seaweed industry, tea tree oil, and native plants such as wattle seed, Kakadu plum and native pepper. Increasing the market capacity for Australian grown raw materials for medicinal herbal ingredients, underpinned by Australia’s ‘clean and green’ branding and reputation for quality provides another opportunity. CMA proposes targeted funding for AgriFutures to work with the Australian complementary medicines industry, supporting additional research and commercialisation to capture the opportunity of locally grown ingredients fully.

 

Support Programs for Exporters

CMA believes that government support programs are vital to assist Australian exporters in conducting business in emerging and growth markets, and in terms of provision of advice, capacity building and expediting export opportunities. Maintaining Austrade as an active organisation is vital to Australia’s economy, as are the continued efforts by the Department of Foreign Affairs and Trade (DFAT) to support Australian firms in building secure international networks.

Austrade and DFAT’s Australia-China Council have provided instrumental support for our industry in building engagement with Chinese stakeholders, a notable example being the strong presence of Australian brands at the CMA Australian Pavilion at the Healthplex Expo in Shanghai, one of the premier events for companies looking to enter the Chinese market or to raise the profile of their brands. Similar support for building brand awareness in the Indian market would be of great value.

 

CMA Budget Recommendations Ensure support for manufacturers and a level of certainty for businesses, in the consistent application of Country of Origin and Australian Made provisions. Secure the Australia-India Comprehensive Economic Cooperation Agreement to support Australian businesses in our sector to benefit from the future market opportunities offered by India. Targeted funding for AgriFutures to collaborate with the Australian complementary medicines industry to increase locally grown ingredients. Back the complementary medicines industry export program with continued investment in Austrade to support Australian exporters and enhance Australia’s global competitiveness.