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NT Export Markets and Investment Development Scheme
In April 1983, Cabinet approval was sought to establish a scheme which would provide loan assistance to locally based companies, local subsidiaries of interstate companies, individuals and partnerships with the purpose of encouraging the development of export markets for Territory products and services including tourism.
It also aimed to encourage entrepreneurial investment attraction activity for development projects, including the mining and energy industries.
The submission to Cabinet noted that industry in the Northern Territory (NT) was characterised by a large number of small enterprises producing goods and providing services with export potential.
Many had limited financial capacity which was an inhibiting factor in their efforts to identify and develop export markets.
At that time, the Commonwealth Export Market Development Grants Scheme (EMDGS) provided taxable grants of 70% of eligible expenditure incurred in developing export markets to bona fide exporters.
Expenditure that would generally be eligible under the EMDGS included activities such as market research, advertising, participation in trade fairs, overseas travel and export labels and packaging.
In some cases, recipients under the Commonwealth Scheme had to wait up to 18 months after incurring expenses before receiving their grant moneys. This delay placed a considerable financial burden on smaller businesses striving to develop export markets.
To ease the burden on companies in relation to export development costs during the period prior to receipt of EMDGS moneys, and further encourage industry to develop export markets, the submission proposed the establishment of a facility which would be known as the Northern Territory Export Markets and Investment Development Scheme (EMAIDS).
The scheme would offer an interim loan to exporters so they would be in a position to undertake timely follow-up action in respect of overseas markets rather than having to wait for EMDGS reimbursement and perhaps lose the initiative of the previous market exploratory visit.
Similarly, a loan facility would be established for entrepreneurs to allow them to follow up investment joint venture initiatives to maintain contact with potential investors overseas.
The scheme would provide interest free loans on the following basis:
- loans of 70% of the cost of international air fares only will be made to bona fide exporters or entrepreneurs travelling overseas with the aim of securing an export market for their products or services, instigating joint ventures or attracting foreign participation in development projects in the Territory
- the loans will be paid upon their return from overseas on presentation of air tickets
- the loan agreement would stipulate repayment in full within one month of the receipt of the Commonwealth EMD Grant or 18 months after the date of issue of the loan, whichever was the sooner in the case of exporters, or 18 months after the date of issue of the loan in the case of investment missions and visits.
The Scheme would be administered by the Northern Territory Development Corporation.
Cabinet did not approve the proposal on the basis that it needed the NT Government to underwrite a Commonwealth incentive scheme.
The Cabinet did indicate the Northern Territory Development Corporation should accept applications for interim funding where exporters were awaiting payment under the Commonwealth Scheme and instructed the Minister to pursue with the Commonwealth Government the more expeditious payment of benefits under its Scheme.