I was invited recently attend the Australia-Israel Chamber of Commerce’s panel discussion on ACE’s behalf. The title of the discussion was “Serving the Resources Industry Beyond the Boom,” and a few important issues arose that might be of interest to the ACE community:
1) In spite of the mining sector’s recent softness, the long-term future still looks relatively bright for Australia’s resource sector. The recent decline in the market—and the several thousand job cuts that have come with this—are a supply-side pause in a growth trajectory that was as frenetic as it was unsustainable. In spite of this short-term pain, however, there’s no scenario in which the resource sector fails to be a vital part of Queensland’s economy in the future.
So here’s the part that’s most relevant to an entrepreneurship-focused audience. A few of the speakers were opining about how the downturn affected the industry, and the consensus was that entrepreneurs are succeeding in this sector in instances where they are bringing forward clever ways to reduce cost structure within Australia’s resource assets. The Australian resource industry has been lambasted for so long on account of its uncompetitive cost structure—high currency, extortionate wages, etc.—and so those few entrepreneurs who are succeeding in this environment are those that are directly helping to solve this problem.
2) I mentioned to you a few weeks ago that impressive amounts of natural gas were discovered in the Israeli sector of the Mediterranean Sea. What I failed to realize until today, however, is that Australia’s Woodside is playing a major role in this development:
3) Israel is a bit of a hotbed of entrepreneurial activity by international standards. They showed some impressive statistics from the “IMD World Competitiveness Yearbook 2011” showing that R&D spending is 4.4% of GDP in Israel (much higher than just about every other country you’d care to name), and the country ranked at the top of the list as an environment for fostering entrepreneurship. In fact, the parting gift given to all of the speakers was a book titled “Start-Up Nation: The Story of Israel’s Economic Miracle”:
http://www.amazon.com/Start-up-Nation-Israels-Economic-Miracle/dp/0446541478/
So one of the broad themes that shone through this event (and that might be of interest to ACEs everywhere) is the relatively strong performance of Israel on a national level with regards to entrepreneurship.
4) The themes from points (2) and (3) came crashing together in my mind. Might Israel’s zest and above-average record for starting new technology companies inject some much-needed entrepreneurship into the upstream oil & gas industry now that Israel is becoming an energy powerhouse? This point didn’t get explicitly addressed, but it certainly crossed my mind.
-Rob.
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Robert K. Perrons
Associate Professor of Technology Management and Strategy
Science and Engineering Faculty and Business School
Queensland University of Technology
www.perrons.net