Treasurer travel report - United Kingdom, France, Spain and Italy

Purpose of travel

Travel was undertaken to the United Kingdom (UK), France, Spain and Italy to promote Victoria’s economic credentials, strengthen trade and investment relationships, and engage with government counterparts to advance Victoria’s international engagement priorities. Priority engagements included:

• Promoting the effective and efficient delivery of the state’s funding requirements.
• Gaining an enhanced understanding of emerging international business trends.
• AUKUS focused discussions in London.
• Carrying out the signing of a strategic partnership between the Victorian Government and Île-de-France Region.
• Providing an update on Victoria’s economy, fiscal strategy and funding program to investors in bonds issued by Treasury Corporation of Victoria (TCV), promoting bonds issued by TCV as a high-grade liquid investment and supporting TCV’s investor relations activities in Europe.
• Undertaking meetings with key investors throughout the program, including Madrid and Milan.

Leveraging the strategic partnership between the Victorian Government and Italy’s Region of Lombardy as the first Victorian minister to visit the region since the signing of the Memorandum of Understanding (MoU) in 2022.

Benefits of travel to the State of Victoria

Over the past 10 years the Treasurer has undertaken 14 international trips and had 128 engagements with international companies. In addition to engaging with many existing investors in the state, 54 engagements were in relation to active investments that have been subsequently secured, resulting in 4,423 jobs and $4.9 billion in capital expenditure for the State of Victoria.

United Kingdom

The UK economy ranks as the sixth globally by gross domestic product (GDP). By value, the UK is Victoria’s 15th largest two-way merchandise trading partner and 19th largest merchandise export market. The UK is also the third largest source of foreign direct investment (FDI) in Victoria.

The benefits of travel to the UK included:

London

• Undertaking a discussion with PIMCO on the UK, European and global economies with a general view that the world economy is in a low growth, equilibrium phase with inflation likely to be higher in the future.
• Meeting with the International Centre for Pension Management (ICPM) at which the Chair of ICPM provided insights into the global pension system. The discussion also focused on challenges faced by the large “Maple 8” funds in Canada, consolidation in other jurisdictions and the need to think about pension drawdown as well as accumulation. Insights were also shared on the fiduciary duties of pension funds, investment in public local infrastructure, climate investing and the energy transition.
• Hosting a Victoria-UK Housing Roundtable to discuss policy settings in the UK that influence investments in housing and infrastructure. The discussion highlighted the importance in having clarity and certainty around approval processes and the necessary levels of capital for investments to proceed. It also provided the opportunity to hear from the private sector the need for government to create a pipeline of projects to underpin a steady flow of investment.
• Meeting with Principles of Responsible Investment (PRI) to receive an update on how global capital allocators are incorporating environmental social and governance issues into investment decision making.
• Meeting with Wellington Management to hear their views and insights on global macroeconomic and policy conditions and outlook, from both a cyclical and secular perspective.
• Meeting with Goldman Sachs to hear their insights on geo-technological and cyber competition, and global security and geopolitics, and implications for the economic and investment outlook as well as interest rates and debt markets.
• Undertaking a meeting with Rolls-Royce to complement meetings with other Defence Primes to determine how the company is approaching recruitment and training of UK personnel to meet the increased demand following confirmation that Rolls-Royce will provide the reactors for both British and Australian versions of SSN-AUKUS. It will be necessary to align workforce development in Victoria with that currently exercised in the UK if Victoria is to attract its fair share of the inevitable investment which will be generated by the AUKUS program.
• Hosting a joint Investor Roundtable with Westpac where discussions focused on companies' priorities and areas of interest to either establish or expand their activities in Victoria and how the Victorian Government could assist with these plans.
• Meeting with the City of London to discuss the high level of engagement and partnership between Victoria and the UK financial and professional services sectors and how the Victorian Government could support the Lord Mayor and accompanying business delegation visit to Victoria in early 2025 with a focus on potential investment opportunities.
• Meeting with QinetiQ for a discussion on the opportunities for defence investments in Victoria arising from AUKUS and potential areas for support to assist the company’s current and future operations in the state.
• Hosting a trade function with Victorian businesses that have established a presence in the UK to gain insights into their exporting experiences and where there may be opportunities to further collaborate and facilitate introductions with potential customers and stakeholders.
• Meeting with Bank of England to obtain their views on UK economic and political developments and to provide an update on Victoria’s economic outlook and fiscal strategy and key messages from the 2024-25 financial year budget. The meeting also addressed TCV’s funding program, management of the UK’s official foreign currency reserves, Bank of England’s investment parameters and appetite to purchase bonds issued by TCV.
• Meeting with Copenhagen Infrastructure Partners to discuss developments in renewable energy investments and the green transition.
• Hosting an Investor Roundtable with insurance companies, banks and fixed income managers to provide an update to investors on bonds issued by TCV, an overview on Victoria’s economic outlook and fiscal strategy, and key messages from the 2024-25 financial year budget. There was also a discussion on broader economic and debt market conditions and outlook, TCV’s funding program as well as investors’ appetite to purchase bonds issued by TCV and attitudes to issuance of labelled (i.e. green or sustainability) bonds.
• Meeting with International Capital Market Association to understand developments in financial markets’ regulation and reporting, including implications for TCV as an issuer of sustainability bonds and for the state’s and TCV’s ongoing climate related risk and sustainability impact reporting.

France

France ranks as the second largest economy in the European Union (EU) by GDP after Germany. By value, France is Victoria’s 16th largest two-way merchandise trading partner. Importantly, France is the second largest investor in Victoria with French investment worth $5 billion over the past 5-years and creating more than 1,100 local jobs. The establishment of the Paris Victorian Government Trade and Investment (VGTI) office for Europe has enhanced the state’s engagement and reach across France and the region is presenting further trade and investment opportunities in renewable energy, transport and infrastructure, technology and life sciences.

The benefits of travel to France included:

Paris

• Meeting with Australia’s Ambassador to France to discuss the Australia-France relationship and further opportunities for in-market collaboration.
• Co-signing of a Cooperation Agreement between Victoria and Île-de-France alongside the President of Île-de-France Region (Paris Region). The signing ceremony also allowed for the opportunity to discuss the strategic importance of the agreement in enhancing cooperation between Victoria and the Paris Region, focusing on key areas such as economic development, innovation and cultural exchange; and to explore specific joint initiatives and projects that can be undertaken under the agreement, aiming to foster collaboration.
• Meeting with Qubit Pharmaceuticals for an overview of the company's growth ambitions, including exploring suitable academic partners to contribute to their novel drug discovery research program. The conversation focussed on the strengths of the Victorian university and research sectors, and it was agreed that the VGTI Paris would continue to facilitate introductions with potential partners in Victoria to assist their considerations around establishing a presence in Victoria.
• Meeting with PASQAL for an overview of the company's capabilities in building both quantum hardware and software including how the Victorian Government could facilitate introductions with potential partners. PASQAL also explained their relationships with existing research institutes and universities in Melbourne highlighting the opportunity to strengthen their engagement in Victoria.
• Attending a French Investors Dinner with MEDEF International, which demonstrated the strong level of commitment from large French companies to continue to invest in major projects in Victoria spanning transport and infrastructure, renewable energy, aviation and aerospace, and pure research projects.
• Undertaking a meeting with the Elysée Team (French President Cabinet) to underline Victoria’s commitment to strengthening its trade and investment ties with France following the opening of the VGTI office for Europe in Paris in March 2023. The meeting provided the opportunity to discuss France’s international trade and investment priorities and explore opportunities for collaboration with Victoria.
• Meeting with the French Treasury to share economic updates and discuss business supports in place to encourage greater two-way trade between France and Victoria.
• Meeting with Banque de France to obtain their views on French and European economic and political developments and to provide an update on Victoria’s economic outlook and fiscal strategy and key messages from the 2024-25 financial year budget. The meeting also addressed TCV’s funding program, management of France’s official foreign currency reserves, Banque de France’s investment parameters and appetite to purchase bonds issued by TCV.
• Meeting with the Organisation for Economic Co-operation and Development (OECD) to discuss key economic and geopolitical issues, the European and global economic outlook, monetary and financial conditions, and key tax and public policy developments.
• A visit to STATION F, the world’s largest startup campus with over 1,000 startups and more than 30 programs; and a separate meeting with La French Tech, which provided the opportunity to discuss potential for collaboration and partnerships in technology and innovation with La French Tech startups and scaleups, aiming to bring cutting-edge technologies and entrepreneurial expertise to Victoria.
• Meeting with the Secretary General, International Chamber of Commerce (ICC), to discuss Victoria's strategic priorities and opportunities to enhance global trade and investment as well as potential areas of collaboration for the Victorian Chamber of Commerce and Industry’s delivery of the 14th World Chambers Congress in Melbourne in September 2025.
• Meeting with La Cité du Vin to discuss how they collaborate with global partners in promoting wine culture from around the world and the opportunity for a potential partnership that would allow for Victoria to be promoted and showcased in the Cité du Vin Museum and retail space in Bordeaux.

Spain

Spain’s economy ranks as the fourth largest in the EU by GDP. Spain is the fourth largest source market of FDI in Victoria. By value, Spain is Victoria’s 23rd largest two-way merchandise trading partner and 53rd largest export market.

The benefits of travel to Spain included:

Madrid

• Meeting with Australia’s Ambassador to Spain to discuss the Australia-Spain relationship and further opportunities for in-market collaboration.
• Meeting with the Minister for Economy of the Community of Madrid to discuss the economic and innovation complementarities between Victoria and Spain and share best practice trade engagement and opportunities to further strengthen government and business links.
• Meeting with ACS Group to learn about how they are partnering with other European and global players in delivering major international infrastructure projects and their priorities for Victoria, including how they plan to grow their business in Australia.
• Hosting an Energy Investor Roundtable to highlight Victoria’s renewable energy targets, relevant policies and growing infrastructure needs, and to discuss investment opportunities in the state.
• Attending a joint Australia-Spain Business Association and RMIT University Networking Event to meet key partners in Madrid that play a pivotal role in advancing the Paris VGTI’S work in Spain and to discuss opportunities to grow partnerships between the State of Victoria and Spain.
• Meeting with Acciona to discuss future collaborations in renewable energy projects, infrastructure development and sustainable solutions in the state. The meeting provided the opportunity to highlight Victoria’s renewable energy and infrastructure capabilities that position the state as a key location for Acciona’s advancement and learn of Acciona’s current priorities for Australia.
• Meetings with renewable energy companies Navantia Seanergies and Ocean Winds to discuss their future plans for Australia and highlight the opportunity for investment in Victoria with respect to offshore wind.
• Meeting with Fever to congratulate the company on its recent and successful investment in a permanent exhibition space in Brunswick and to discuss their long-term development plans for growing the cultural sector in the state.
• Meeting with Victorian company Rubicon, who have offices in Spain and Italy, to discuss the company’s activities across the region and how the VGTI Paris can support upcoming activations in Spain.
• Hosting a Victorian Exporters’ Roundtable to discuss challenges and opportunities faced by Victorian exporters working in Spain and to explore ways to enhance support trade mechanisms, market access and business development opportunities.
• Meeting with IDOM to discuss the company’s plans for Australia, including opportunities for potential partnerships with Victorian companies and institutions to collaborate on infrastructure, engineering and architectural projects.

Italy

The Italian economy ranks as the third largest in the EU by GDP. By value, Italy is Victoria’s 12th largest two-way merchandise trading partner and 32nd largest merchandise export market in the 2023-24 financial year. Victoria and Italy shared comparative advantages in agriculture, food and beverage processing, advanced manufacturing, textiles, defence, fashion and renewable energy.

The benefits of travel to Italy included:

Milan

• Attending a meeting with the Mayor of Milan to discuss strengthening collaboration between Melbourne and Milan in areas such as design and culture, urban planning, sustainability and innovation. The meeting also provided an opportunity to reflect on the 20th anniversary of the sister city relationship between the two cities and share upcoming activations in Milan in celebration of the anniversary.
• Meeting with Energy Dome, a company specialising in long-duration energy storage technology, to discuss their planned activities in Australia and promote Victoria as an ideal location for their business development. The meeting highlighted Energy Dome’s innovative solutions and discussed how Victoria can leverage their technology to support the state’s renewable energy and energy storage targets.
• Meeting with Vitale and Partners and Vesper Infrastructure to discuss the investment environment in Italy and potential sectors of interest that could attract Italian investment into Victoria. The meeting was also an opportunity to gain insights into the European finance landscape, economic trends and public policy across the region.
• Meeting with Leonardo to discuss their current and potential investment plans in Victoria and Australia and learn more about their strategy and insights into Advanced Air Mobility. This was followed by a site tour of their facilities showcasing their VTOL prototype. The meeting provided an opportunity to showcase Victoria’s strategic importance in Australia’s defence landscape, highlighting the state’s strengths in research and development, manufacturing and skilled workforce development.
• Meeting with Ghella to discuss how the establishment of their office in Melbourne is tracking and understand their priorities for growing in Australia and exploring new opportunities in renewable energy.
• Opening the third edition of the RMIT Future Europe Series 2024, a partnership between the Victorian Government (Global Victoria) and RMIT University, bringing together industry and thought leaders in infrastructure, energy, education, finance and government. The event focused on how Victoria and Italy, in particular the Region of Lombardy, can work together to tackle issues around innovation, skills and sustainability. This builds on the MoU signed between the State of Victoria and the Lombardy Region in 2022 and places a focus on areas such as vocational education and training; and promoting knowledge sharing platforms that support innovation between industry and universities.
• Meeting with Webuild to discuss their activity in Victoria and to explore opportunities.
• Attending a meeting with the President of the Lombardy Region to discuss the strengthened relationship between Victoria and Lombardy and further collaboration opportunities under the strategic partnership signed in 2022. During the meeting, potential future engagements in Milan and Melbourne in 2025 were discussed, including a business delegation from Lombardy Region to Melbourne and activations during the visit of a Victorian trade delegation to BioEurope Spring led by Global Victoria.

Meeting with Sosteneo to discuss their renewable energy investment activities, particularly focusing on their first investment at Kerang, Victoria. The meeting highlighted Victoria as an ideal location for their business development, emphasising the state’s thriving renewable energy sector and commitment to ambitious energy targets.

Next steps/Follow up

United Kingdom

• Work with Rolls-Royce regarding investment opportunities in Victoria associated with AUKUS Pillar 1. Continue discussions to create apprenticeship opportunities for their future projects and business in Victoria.
• Work with QinetiQ around investment opportunities in Victoria associated with AUKUS Pillar 1.
• From the Victoria-UK Housing Roundtable, consider key insights and learnings from players in the UK’s housing sector on a range of policy settings such as private equity investment, regulation and unlocking public land for development.
• Follow up with the City of London to support planning and delivery of the Lord Mayor’s visit with a delegation to Victoria proposed for early 2025.
• Consider further collaboration opportunities with Victorian companies operating in the UK to continue to support their growth aspirations in the UK and Europe.
• Undertake follow up discussions with Lloyds of London and Bank of England regarding opportunities and mechanisms to participate in TCV bond issuance.

France

• Implement the MoU with Île-de-France through targeted engagements both in Paris and Melbourne. A key activity for next year already in planning is a Victorian presence and trade mission to Vivatech 2025, a business and innovation conference held annually in Paris.
• Continue to work with Qubit Pharmaceuticals and PASQAL regarding their respective interests in Victoria and facilitate introductions and potential quantum computing collaborations with Victorian research institutes.
• Consider key insights from the experience at STATION F and La French Tech startups and scale ups and opportunities for potential collaboration and partnerships aimed at bringing cutting-edge technologies and entrepreneurial expertise to Victoria.
• Undertake a follow up discussion with Banque de France regarding opportunities and mechanisms to participate in TCV bond issuance.
• Follow up discussions with MEDEF International to support the planning and delivery of their business delegation to Victoria in April 2025.
• Continue conversations with La Cité du Vin and assess options for showcasing Victorian wine culture in Bordeaux.
• Work with the World Chambers Federation and the Victorian Chamber of Commerce and Industry in support of the upcoming World Chambers Congress to take place in Melbourne in September 2025.
• Attend the official opening of the French General Consulate in Melbourne together with the Ambassador for France to Australia in October 2024.

Spain

• Consider further opportunities for a government-to-government strategic partnership with the Madrid Region focusing on key sectors such as pharmaceuticals and biotechnology, digitisation and AI, renewable energy and technology.
• Continue discussions with Victorian companies operating in Spain and support their growth across Europe, including encouraging their participation in upcoming trade missions and activations.
• Continue to work closely with Idom and Ocean Winds providing relevant information to solidify and confirm potential investments into Victoria.
• Support relevant introductions and connections for Fever into the creative and entertainment sector to support their entry into Victoria.

Italy

• Continue to work with Webuild regarding their interests in developing a training academy in Victoria.
• Follow up with the Region of Lombardy and work in partnership to support the planning and delivery of a high-level delegation to Victoria, proposed for 2025.
• Continue to work with Energy Dome around investment opportunities in Victoria associated with long duration energy storage.
• Work with government and industry partners in Lombardy to deliver a high-level trade mission to Milan in March 2025 as part of the BioEurope Spring conference in Milan.

Work in partnership with RMIT University to prepare and deliver a report following the Future Europe Series event in Milan that can be shared with participants and act as a reference tool for prospective Italian investors on opportunities for exchange between Victoria and Italy.