Analyse the Impact of Globalisation on the Australian Economy
Globalisation is the movement across nations of trade, finance, investment, technology and labour. Throughout the movement of the world towards globalisation, Australia has been impacted to a large degree in regards to the factors of Globalisation, including trade, finance, investment, technology and labour. Following these impacts, there are implications that these factors have on the Australian Economy. One of the major components of the Australian economy that has been impacted by globalisation is trade. ... Trade would be affected by globalisation in opening up opportunities for Australia to buy and sell their goods and services to a wider market overseas. Downturn in the world economy would also impact Australia in that fewer goods will be exported because they are not able to afford it. ... This was accompanied by the weak world economy resulting in the fall of resource export. ... However, in the longer term, globalisation has had a considerable effect on the size and structure of Australia’s trade. ... The structure of trade has been an impact of the world’s demand for the products in Australia as well as the domestic structural reforms. Therefore, in a large way, Globalisation has opened up the size and structure of trade in Australia. Globalisation has also had a hefty impact on financial markets and flows in Australia. ... It usually refers to the currency of an economy. After globalisation, countries would become unrestrained to perform international transfer of funds. Economies would invest within each other, there would be the trade of foreign exchange and there would be frequent borrowing and lending of money since globalisation has pulled down the barriers of restricting policies. ... This means that if globalisation had not come into action, neither would the existence of any foreign trading. The Australian dollar has experienced an increase over the last six months particularly against the US dollar. When the US dollar rises, the rate of the Australian dollar falls and vice versa. Due to the faster growth in the Australian economy, there has been an increased seeking of Australian Dollar bonds from overseas investors. As the interest rates rise, so do the level of currency investors; this demand then leads to higher rates of interest and eventually leads to a more stable and sound economy. Therefore, monetary policies are affected by overseas investors and globalisation, which allows them the freedom of trading in this manner. Another aspect of Australian finance that is being impacted by globalisation is a concept referred to as ‘the intrinsic tendency’.