Peter Kalis, Chairman and Global Managing Partner of K&L Gates, cited the “enormous investment flow” from the United States to Australia as one primary motivating factor behind the firms recent merger with Australia’s Middletons.    Resources – and a variety of other sectors account for this investment flow – as Kalis outlined.

Kalis’ comments were made during a joint interview with K&L Gates Australia Managing Partner Nick Nichola in March of this year.  Nichola cited globalization and consolidation as a driving force behind Middletons decision to join forces with K&L Gates. Kalis stated that this merger brings to 11 the total number of offices K&L Gates now maintains in the Asia-Pacific market.

Kalis’ reasoning behind the merger is most certainly borne-out by the facts – both in Australia and the Asia-Pacific region as a whole.  Much of the Asia-Pacific region is experiencing double-digit economic growth – and while Australia is currently not performing as well – proposed governmental changes to export policy should see GDP expand beyond the current approximate 2.5%.  Either way, Australian growth is outpacing both the US and Europe.

Asia-Pacific legal market growth

Kalis’ reasoning behind K&L Gates decision to expand in the Asia-Pacific region was underscored last April when at the Inter-Pacific Bar Association Annual Meeting, London-based legal sector consultant Alan Hodgart outlined that the Asia-Pacific Legal Market is set to double in size by 2017.

Australia growth

Fueling Australia’s growth is the mining sector followed by agriculture — and products from both sectors are exported to East Asia markets. While prices for Australian resources exports to China have decreased in recent months and unemployment is up – Australian Prime Minister Kevin Rudd plans to attempt to diversify the economy and its exposure to other Asia region growth markets like Indonesia.  Australia’s current approximate 2.5% economic growth rate may increase with this new expanded regional exposure.

US-Australia trade

According to the Australian Department of Foreign Affairs and Trade, the United States is Australia’s most important trading partner.  Indeed, the US accounts for one-fifth Australia’s merchandise export market and is its most important market for services.

Many opportunities  for US firms

As a result of the 2004 Australia-US Free-Trade Agreement — Australian companies have full access to the US federal government procurement market, worth at least US$535 billion annually.  This is one of a plethora of examples of why expansion into Australia by US law firms should, if business development initiatives are properly designed and implemented – result in an uptick in inbound US domestic revenue.  Mr Kalis and K&L Gates were wise to have focused on the Asia-Pacific market in general, and Australia in particular.

Posted by John Grimley

John Grimley edits and publishes Asia Law Portal. An independent writer & editor, he's the author of: A Comprehensive Guide to the Asia-Pacific Legal Markets (Ark Group 2014).

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