The popular Export Market Development Grant (EMDG), a cornerstone cash funding program for Australian businesses seeking to grow in new overseas market, continues to see changes. Austrade has just announced another consultation phase which comes off the back of a series of changes and consultations. What does this mean?
GrantReady supports many businesses to successfully access EMDG and we continue to analyse the changes and impact. Here’s what we wrote about the cuts last year. A couple of weeks ago we noted that Round 3 funding amounts looked positive and Australian businesses saw a glimmer of hope of future funding boosts.
Federal Budget Review
However, given the 2023 Federal Budget revealed that funding for EMDG would be cut by $61 million over the next four years, it looks like the future funding pool will shrink. The cuts followed a 2022 review of the scheme, conducted in response to criticism from exporters about dwindling grant amounts. The review also found that the changes to the program by the former Coalition government had largely been positively received. These changes were implemented in 2021 and transformed the scheme from a competitive reimbursement program to an uncompetitive multi-year grants program that is opened on an annual basis.
But the review also predicted that with the number of applications set to increase, the grant amounts awarded would continue to drop to a point where the budget available may not sufficiently match the level of interest. They also noted that over the past 10 years, EMDG applicants’ predominant region of export has been the Americas, followed by Europe. It looked at whether a refocused EMDG could better align with government strategic trade priorities in the Indo-Pacific region.
Changes Considered in Consultation
With the new consultation under way here are some of the changes to the program being considered include:
Introducing payment caps
Introducing a minimum marketing spend threshold
Introducing a minimum business turnover threshold
Adjusting the matching contribution model from 50:50 to 70:30
Strengthening eligibility requirements to balance demand with the available budget, including an “enhanced export readiness test”
Capping the grants at a predetermined number and value for each category or tier of EMDG
Closing grants rounds once the specified number of applications are received.
The consultation will close on 11 August 2023
GrantReady is keeping a close eye on consultation outcomes and how this will impact the grant in the future. In the meantime we continue to support our clients and new clients successfully access EMDG. We continue to be proud of the successes that flow from the program and want to see a grants program that provides Australian businesses with the support they need to grow and thrive at home as well as overseas.