Australian Trade And Investment Essay Research Paper

Australian Trade And Investment Essay, Research Paper Trade and investmentAustralia’s export structures have changed considerably over the past 15 years. Although trade in commodities remains strong, new services and sophisticated manufacturing export markets have emerged.Merchandise exports were valued at $86 billion in 1998-99. During the same year, Australian exports of services totalled $26 billion. Exports recorded seven per cent average annual growth in the five years to 1998-99. They now account for 20 per cent of GDP, compared with around 15 per cent in the mid-1980s.Japan remains Australia’s largest single export market, buying one-fifth of total merchandise exports. The United States and Korea each account for eight per cent of exports, and New Zealand for six

per cent. The United Kingdom, Taiwan, China, Singapore, Hong Kong and Indonesia are all significant export markets.Australia’s imports are dominated by manufacturing. The two largest import items in 1998-99 were cars and computers, accounting for seven and five per cent respectively of total merchandise imports. Supplier of advanced manufacturesAustralia is generating new strengths as a supplier of advanced goods and services. Over the 1990s, exports of elaborately transformed manufactures (ETMs), with high levels of value-adding, have grown at an average annual rate of 14 per cent, well above the growth rate for these products in Japan and Germany. Products such as components for mechanical and electronic equipment, as well as assembled motor cars, have recorded strong growth

in the last decade.Australia is also developing a new competitive edge in high-technology exports, such as scientific and medical equipment, telecommunications, software and aerospace products.Australia maintains its position as a leading exporter of major commodities. Key commodity exports in 1998-99 include coal (valued at $9.3 billion), iron ore ($3.8 billion), wheat ($3.4 billion), beef and veal ($2.9 billion), petroleum and other gases ($1.7 billion) and cotton ($1.6 billion). In the last 50 years Australia has become a world leader in scientific instrumentation, nanotechnology, solar engineering, astronomy, immunology and drug design. (ACIO) At the same time, the degree of processing which Australian exports undergo has been steadily increasing, reflecting the increasing

sophistication of Australia’s export mix and higher levels of value-adding of raw materials in Australia. Unprocessed foods, fuels, minerals and other primary products declined from 46 per cent to 37 per cent of merchandise exports between 1988-89 and 1998-99.Export diversificationReforms within the Australian economy have helped make it more flexible and responsive to change.During the recent East Asian economic crisis, for example, exporters diversified into new markets in North America and Europe, as well as in the Middle East and South America.In 1998-99, merchandise exports to Saudi Arabia grew by 95 per cent, to Egypt by 71 per cent, to Mexico by 46 per cent and to Chile by 39 per cent.Export growth to East Asia recovered considerably towards the end of 1999, signifying a

positive export outlook for 2000.Education, professional, communications, insurance and financial services exports totalled $8.4 billion in 1998-99.Tourism now accounts for 14 per cent of Australia’s total export earnings and is Australia’s leading services export item (see p. 49). Australia is a leading exporter of major commodities. Trade prioritiesAustralia has a strong interest in the removal of barriers to investment and trade in goods and services. The White Paper on Foreign and Trade Policy identifies Australia’s main trade priorities as:? domestic reform ? improving bilateral relations ? improving the regional framework for trade ? strengthening the international trading system and ? promoting exports. Australia places a high priority on achieving further