1. List the country in which your everyday school items are made?
School shoes – made in Australia
School uniform – made in Australia
Pens – made in Japan
Pencils – made in Germany
Pencil case – made in China
Ruler – made in China
Eraser – made in Germany
Calculator – made in China
Laptop – made in China
Textbooks – made in China
2. How can countries gain a competitive advantage in trade?
Countries can gain a competitive advantage in trade by producing products more cheaply and efficiently compared to other countries, ensuring more customers and hence more income.
3. What is GDP? How does trade contribute to GDP?
GDP stands for Gross Domestic Product; trade contributes to GDP as the GDP comes directly from exports.
4. Outline the benefits of exports for Australian employment.
The benefits of exports for Australian employment include increased sales and greater profits for companies as it increases the work opportunities and more employment within Australia, it is estimated that around a fifth of Australian jobs are reliant on export industries.
5. Why are exporting businesses more successful than non-exporters?
Exporting businesses are more successful than non-exporters as international trade companies have the potential to reach the world’s population of nearly 7 billion people, a much larger market compared to the markets non-exporters have access to.
6. Explain the relationship between exports and imports.
Exports are the production of goods, services and ideas in one country and the sale of them to another where the exporting country receives payment from the country to which they are sold. Imports are the purchase of goods, services and ideas that have been produced in another country, where the country that produces the goods and services receives payment from the country that imports them.
7. Explain how the composition of Australia’s imports and exports has changed over time.
The composition of Australia’s imports and exports has changed over time as between 2000 and 2005, the primary products traded such as wool increased from 45% to 50% of Australia’s exports and imports causing the simply transformed manufacture, elaborately transformed manufacture, and other goods and services to decrease slightly.
Activity 2: Globalisation and trade
1. Explain what the term ‘balance of trade’ means.
The term ‘balance of trade’ refers to the difference in value between a country's imports and exports.
2. Outline how Australia’s trading partners have changed over time.
Australia’s trading partners have changed over time by according to the foreign exchange controlling who Australia trades with and what Australia imports and exports to ensure that Australia receive maximum profit from trade and necessary products. By 1850, the rising wool price accounted for two thirds of Australia’s imports and exports however, now Australia trades mainly with China (36% of imports and exports), this is due to the alliances between the countries as well as the growth in industries. China relies on Australia’s mining resources in order to industrialise however, this demand has reduced and China is now a service producer.
3. Discuss the challenges globalisation creates for countries in the Asia–Pacific region.
Globalisation is described as the speeding up of international interconnectedness in all aspects of contemporary life. Many countries, especially the Asia-Pacific region, have benefited from export as it leads to growth and more open markets, however, being located in the Asia-Pacific region and involved in international trade, some industries have ceased operation as they were not able to compete with the cheap imported goods.
4. Explain how and why Australia attempts to establish close international trade relations.
Australia attempts to establish close international trade relations because free trade agreements are negotiated and trading blocs are established between countries. They do this through making bilateral and multilateral relationships.
5. Explain the difference between tariff and non-tariff protection.
A tariff is a duty to be paid on a particular class of imports or exports where a non-tariff is a form of restrictive trade where barriers to trade are set up and take a form other than a tariff. Examples of tariff protection includes surcharges or taxes whereas non-tariff protection includes licensing rules, quotas or other requirements
6. Explain how trade liberalisation can be achieved.
Trade liberalisation is the removal or reduction of restrictions or barriers on the free exchange of goods between nations. This can be achieved through the removal of both tariff and non-tariff obstacles and is often referred to as promoting "free trade."
7. Outline the Australian Government’s justification for lowering industry protection levels in Australia.
The Australian Government’s justification for lowering industry protection levels in Australia
8. What is a trading bloc? Give 2 examples
A trading bloc is a group of countries that join together in some form of agreement in order to increase trade between themselves and/or to gain economic benefits from cooperation on some level. Two examples are:
– North American Free Trade Agreement (NAFTA)
– European Economic Area (EEA)
Activity 3: Australia’s Trade Composition and Direction
1. Research and identify Australia’s top 5 exports and imports.Exports:
Iron ores & concentrates (20.2%)
Coal (11.6%)
Natural gas (5.4%)
Education (5.2%)
Personal travel (4.4%)
Imports:
Personal travel (7.3%)
Crude petroleum (6%)
Refined petroleum (5.5%)
Passenger motor vehicles (5.2%)
Telecom equipment/part (2.9%)
2. What is the difference between merchandise and service exports? Give examples of each?
Merchandise exports are retail goods offered for sale in a foreign consumer market, it involves the movement of physical goods like cars, televisions and animal meat between countries. Service exports are services provided between countries, advertised to the foreign market such as a travel or transportation.
3. What is the difference between the composition and direction of trade?
The composition of trade is what the country’s imports and exports are composed of and the direction of trade is who the country trades with.
4. List 5 points to illustrate the importance of the Asia-Pacific region in terms of trade to Australia. Reference information from your sources.
• Australia benefits from the nurturing of elaborately transformed manufacture exports to nations such as the demand for natural resources to facilitate growth of rapidly developing nations like China.