The NSW government has continued its push to make Sydney an international financial centre by calling on the federal government to remove tax uncertainty for foreign investors using Australian asset managers.
In its submission to the Financial System Inquiry, the state government recommends establishing an internationally competitive investment manager regime, pointing to an October 2013 Deloitte Access Economics report for three exportable possibilities.
Managing funds for foreign investors and advising other nations on developing wealth management sectors while exporting locally-created financial instruments were two possibilities.
The third was expanding services into Asia in an effort to be the preferred “banker to the region”.
“Given the importance of the sector as an input to the rest of the economy, the future competitiveness of Australian firms, and consequently household incomes, also hinges to some degree on minimising the cost of domestic financial service inputs,” the submission said.
“To further support the internationalisation of the sector, the Panel may also want to investigate barriers, government-imposed or otherwise, to foreign companies cross-listing on Australian stock exchanges or establishing operations in Australia.”
The submission, released today, noted that NSW and Australia has strong capability in asset management, with funds under management (FUM) in Australia currently estimated at $2.1 trillion and set to grow to $7.6 trillion by 2033.
“However, the industry is largely domestically focused, with only $75 million FUM on behalf of foreign customers,” the submission said.