Australian economy and its place in the current international business
Australia is an island nation located in the southern hemisphere and is the largest island in the Pacific continent; larger than the island of Tasmania and other islands in the Southern, Pacific, and Indian oceans. Inhabited for over 50,000 years by Aborigines, the country is officially called the Commonwealth of Australia, as it is a former colony of the British Empire.
Australia is a parliamentary monarchy, headed by Queen Elizabeth II of England and Governor General Michael Jeffery. Australia has the distinction of being the only country, with New Zealand, which is geographically part of the southern hemisphere, and is ranked among the countries of the North in the North/South divide of the world made by Willy Brandt 1980. Australia is indeed regarded as the North because it is a rich (13th richest country in the world) and well developed country (third world position regarding the classification of Human Development Index).
One may ask how this country,that is situated geographically in the South but in reality is related to the North due to its economic performance and development, participates in the current international trade and whether it meets the Ricardian theory of comparative advantage. In the first part of this document, will present the different characteristics of this atypical country; in a second part, it will examine whether it is a Northern or southern country and in the final section it will position it in international trade through its relations with the other states of the world.
Australia is one of the most interesting countries to study from an economic perspective since it is the only country (along with New Zealand) located in the Southern hemisphere while at the same being economically part of the ?North?.
In fact, due to its geographical situation, Australia is the ideal candidate for international trade. Indeed its seaside openings and its huge natural resources are great assets to trade worldwide. This situation has made this country to reach the 13th rank of the biggest world GNP and to show all the characteristics of a Northern country (high HDI, employment in the services).
On the economical level, Australia has negative trade balance. One of main reasons for this is that Australia imports manufactured products while it exports raw materials (for instance, Australia is the first exporter of iron). Besides, its strong growth rate (over 4%) attracts many foreign investments. These two elements seem to contradict its ?North? country status since they are usually associated with ?South? countries. Therefore, one could say that, to some extent, Australia has characteristics from both ?North? and ?South? countries.
Finally, Australia appears to be one the main economic players in Asia. There are many transactions with Japan and China as well and they are now more important than those with the US or the UK, its historical allies. As a consequence, special agreements have been signed or are being discussed between Australia and its Asian counterparts. Australia aims at increasing the transactions with Asian countries that primarily need raw materials in order to develop. It should also be noticed that Australia belongs to the APEC, a free trade area, another means to boost its trade ability.
Tags: Australia-characteristics of the country; economy and its place in the current international trade