The Impact of Globalisation on the Australian Economy

Analyse the effects of domestic and global free trade and protection policies on the Australian economy

Suggesting any economic or policy reforms to the Australian Economy requires us to understand the evolution of an economy and the factors effecting it both intrinsically and globally.

The Australian economy marks external stability as an important objective because it can influence other important aims such as economic growth, unemployment and inflation. External stability is the concept of sustaining a nation’s external accounts so that in the future, it is able to service its foreign liabilities and can avoid currency volatility. When looking at external stability, we must examine Australia’s balance of payments, which records all economic transactions between Australia and the rest of the world. Australia’s balance of payments has two components, which is the current account and the capital and financial account. The current account measures the receipts and payments for trade in goods and services, transfer payments and income flows, while the capital and financial account shows international borrowing, lending, purchasing and sales of assets.

The phrase of globalisation is becoming very popular around the world, and it gives free movement to communicate with people regarding cultural, economic, social, technological, political, educational and businesses. In the modern society globalisation has impacted on many human lives, which started in the western countries in (1492), according to Kevin H. O'Rourke, Jeffrey G. Williamson, and then it expanded all over the world. The word of globalisation can describe many different aspects such as globalisation of nothing, the making of the global society and the globalisation of wealthy and poor. According to Robert Shuey in (2001), ‘’globalisation is widely and somewhat loosely used a term, intended to describe the recent and rapid process of international, economic, social, and political integration’’. The idea of his words that globalisation is giving an opportunity to people, so they can travel, invest internationally, and communicate this can help many businesses people especially in Australia to invest more widely and internationally. Globalisation has impacted on Australian society in all terms of life, for instance, it has an enormous impact on health and education system, on technology, and on the Australian economy. But one of the categories is increasing so widely among Australian people who affect many young people’s lives is the impact of racism on the health and wellbeing of young Australians. The word racism is the very phenomenon aspect in the Australian society, especially between young people. On the very high percentage of many young Australians are experiencing racism between the nation, most of these racists are because of skin colour, cultural beliefs, different traditions from different countries, speaking another language and gender. Racism plays a significant role in the society, and many people are aware of this because when they face radical discrimination from any individual, they feel angry and frustrated, and sometimes they feel of not belonging to the local community.

Globalisation is the process of allowing goods, financial and investments markets to operate across national borders due to deregulation, improved communications, infrastructure and technology.

Australia has been expanding the economies and becoming the wealthiest nations in the Asia-Pacific regions. The old Labor government use a fiscal policy by increasing the government spending in the Global Recession in 2009. Australia generates the mainly sources of exporting form mining and agriculture, and its services, technologies, and high-value-added manufactured goods are competitive international standard. Australia draws attention to foreign investment with foreign competition and a skillful workforce in almost all industries. The government involves less in the most area of the market and the competition in financial services has increased. Government debt is increasing because of the global financial crisis but it is lower than the

The effects of Globalisation on Australia can be disseminated into a number of different categories. For the purposes of this report five major categories including Economic, Social, Cultural, Environmental and Political have been explored and summarised but is by no means exhaustive.

Globalisation is the growing economic interdependence among nations as reflected in increasing actual movements across nations of trade, investment, technology, finance and labour, with the capacity to move and the potential movement across the nations with those five elements. Australia has been involved in trade, investment, financial flows, technology transfers and the migration of labour since its foundation as a colony. The impact of globalisation has changed the structure of Australia’s trade, with considerable growth in manufacturing and service industries, with limited growth in the rural sector. The car manufacturing industry in Australia had high levels of protection in motor vehicles, with an effective rate of protection in

Globalisation is the developing economic interdependence among nations reflected in increasing actual movements across nations of trade, investment, technology, finance and labour, with the ability to move and the potential movement across nations with those five elements. Australia’s involvement in trade, investment, financial flows, technology transfers and the migration of labour since its foundation as a colony, has impacted and changed the structure of Australia’s trade, with considerable growth in manufacturing and service industries, with limited growth in the rural sector. The car manufacturing industry in Australia had high levels of protection in motor vehicles, with an effective rate of protection, in excess of 200% and 57.5%

Since the early 1980s, successive governments have deregulated financial and labour markets and reduced trade barriers making Australia one of the Asia–Pacific’s wealthiest nations who has enjoyed more than two decades of economic expansion. Although Australia managed to emerge from the global financial crisis relatively unscathed, their impetus expenditure by the previous Labour government generated a fiscal deficit. Australia is globally

Introduction: What factors affect the demand and supply of Australian dollars in the foreign exchange markets? Distinguish between the possible causes and effects of currency depreciation and a currency appreciation on the Australian economy. What forces have come into play, if any, in the past four months that have affected the value of the Australian dollar?

AussieBum now utilise the growth of technology such as internet to sell their products through online shopping everywhere around the globe. The company also use social networking such as MySpace and Facebook. Through globalisation AussieBum was able to expand its customer base from Australian customers which was what Ashby originally wanted in 2001 to international customers which is what the company has now in 2013. There has been significant demand for AussieBum products overseas that has led to the construction of supply retail outlets in those overseas countries. This impacts different aspects of operations. For example, the wider the customer base the more variation of products you need to keep customers satisfied which is impacted the products operations is designing and manufacturing. Also the international customer base means there is a larger number of retail outlets and individual customers requesting products, which increases the volume of products operations must make. AussieBum is also impacted by globalisation as the advancement in technology has provided the company with unique opportunities to produce products. The operations department is now manufacturing a new ecofriendly product. Due to the advancement in technology AussieBum can now insource the latest fibres and polymers, such as the Micro Modal Beechwood and bamboo fibre which is used

We observe appreciation within the Australian rate of exchange once an increase in commodity prices occurs and an improvement in Australia's terms of trade. In 2008, we observed commodity value indexes collapse, leading in successively to sharp decreases within the Australian dollar. As commodity costs have surged once more, this has caused farther appreciation of the Australian dollar. Lower inflation in Australia is another catalyst for appreciation of the currency. Over the years, an accrued demand for Australia's exported product and services has been indicative of Appreciation. As a significant exporter of natural products, Australia's terms of trade and future (long term) export performance are powerfully influenced by the costs of these products. With these costs currently over thrice their value held at the beginning of the resources boom in 2003, this has provoked speculative investment within the Australian dollar. When there are expectations prevalent, that the currency will appreciate based on speculation of the other changes in the domestic and global economy, we are sure to see this causing an actual appreciation in the Australian currency. Additionally Depreciation can be a consequence of a decrease in Australian interest rates or increase in overseas interest rates. Depreciation will occur when there is deterioration in investment opportunities in Australia or

Globalisation is the high degree transfer of capital, labour, intellectual capital and ideas, financial resources and technology. It includes the removal of trade barriers and increased integration between countries and companies around the globe, which means BHP can operate in more countries, transfer goods between the countries and in

Globalisation is a broad term that is often defined in economic factors alone. The Dictionary at merriam-webster.com describes globalisation as “the process of enabling financial markets to operate internationally, largely as a result of deregulation and improved communication.” Also due to deregulation on the financial market, multi-national companies are free to trade and move their businesses to areas where a higher return or profit can be achieved. New technology also enables companies to relocate to areas where labour costs are lower, for instance movement of call centre jobs from the UK to India.