The effects of Globalisation on the Australian market

The effects of Globalisation on the Australian market

Globalisation is the term used to identify the worldwide integration of consumer markets, production, labour, technology, investments and cultures. It has also created wealth and better livings standards for thousands of people. Globalisation is increasingly affecting our lives.

Globalisation is an extremely important aspect of Australian business. It allows Australia to open up new markets overseas, which enhances our exports. Trading between Australia and other countries allows access to a market of more than six billion people. Australia has abundant coal resources, which we are unable to consume ourselves. So, we sell it to other countries and in return we are able to purchase products from them. It is estimated that if protection levels around the world were reduced by 50%, the benefit to Australia would be more than $7 billion a year.

Export growth is essential to economic growth and job creation. From 1983 to 1994 over 400,000 more Australian jobs were created by Australia trading with the world. Newly competitive companies, such as manufacturing earn significantly higher wages than industries that serve the domestic markets. Having a bigger market to sell to, means that you can sell more of your product, make more of a profit and afford to pay higher wages. Allowing the manufacturing industry to double its share of Australian exports over the last 20 years. At a conference at the University of Newcastle, it was said, “There is no doubt that international pressure is forcing changes into our economy, but the real impact of globalisation on our workplaces isn’t always clear. In a sense we are trying to define ‘Globalisation’ in a real sense, and not just as catch-phrase for economic change.”

Australia is currently able to sell products to people all over the world. An Australian business, Cochlear Limited, is able to sell cochlear implants to over 50 countries. Spectacular technological advances such as this enable the world to benefit from inventions, like the cochlear implant, not just Australians. Another global Australian business is Biota Holdings Limited. This business develops pharmaceuticals to treat many diseases. In the past only Australians were provided the information this business made available, but now people all over the world can profit. People suffering from influenza, cancer, diabetes or Alzheimer’s disease can be updated with any new biotechnological advance or possible cure for these diseases.

The world’s population has grown from 2.5 billion people to 6 billion people in the last 50 years, at the same time the average per capita income of the world has increased two and a half times. In the hopes of further expanding the growth of Australia’s exports, we are starting to show interest in furthering trade in developing countries such as Argentina and Brazil. Australian companies pursue investments abroad to help and try to create jobs and more money in those countries. This has proven to be successful because every dollar invested in Australia, 96 cents remains, including 50 cents in wages.

Australia is positively impacted by globalisation in many areas of business. International trade helps to boost Australian’s living standards. Over the past decade tariffs have been reduced and gains have been delivered of $1,000 per year to that average Australian family. Globalisation has also forced businesses to work harder to improve their environmental performance. Industries, such as mining, forestry and chemical have stepped up to try and prevent any further deterioration of the earth and waterways.

Globalisation has caused many countries to become branch office nations. If this occurs Australia will lose many of its leading companies to overseas, losing its skills base and its investments. Even if the National Bank were the only company to move offshore, the approximate loss of revenue would be about $800 million a year. Technology has also impacted Australian business. The new technology produced should reduce pollution levels, increase efficiency within businesses and reduce the number of menial tasks performed by workers. The Internet and other new information technologies have accelerated the pace of globalisation, which has resulted in greater competition throughout the world.

Australian businesses are required to adapt to modern day developments triggered by globalisation. Businesses need to make the change from offering only e-commerce to become a complete e-business corporation. Ford and general Motors effectively used the Internet, and now have an excellent relationship with their customers and suppliers. They also understand the importance of the bosses and employees having mutual respect for one another. It is currently possible for businesses to advertise their products and services online. Meaning that anyone from anywhere in the world can access your site to view your product, and possibly purchase it.

The impact of globalisation has been increased by improved global communication throughout the world. Constantly technology is advancing and helping to improve businesses. Globalisation has given a new meaning to the saying; the world is rapidly becoming a very small place indeed.