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July 9, 2007
Australian trade still lagging
ABC News has reported today on the presentation to be delivered at the Committee for Economic Development of Australia, noting that Blainey's notion of the 'tyranny of distance' is still alive and well in international trade. This is a crucial issue that needs to be addressed in economic policy and consideration of services and practices in Australia, and it is a shame that so far very few speakers have engaged on the topic. But everything from broadband rates and research and development program management, to export policies and international collaboration, all impact on Australia's dismal international trade performance. It's time Australians stopped complaining about the distance and small population problem and looked at countries with similar (and smaller) population sizes as possible partners in international trade.
There are strong opportunities for Australia if we only get over our lack of confidence and apathetic business and policy demeanor in terms of world trade. Just because something is created locally doesn't make it either too experimental or not good enough in world terms. But if we have to partner with US or European entities in order to achieve that shift in perception, then so be it. We should enter into clear and supported international partnerships on research and development with exchange programs on employment of skilled staff (overcoming visa issues, without compromising security) and we should share the rewards of such a program.
And while it may be controversial of me to say this, I am extremely doubtful of Australia's capacity to enter in to the same kind of programs with our neighbouring countries in Asia, because in the short term at least, Australia's links with Asia are, if anything, damaging our international trade reputation. I'm sorry but most of Asia is still very parochial or cheap labour, neither of which is going to look good in world terms, and where we do trade with Asia we have a tendency to sell resources at very low price and then re-import those goods after they have been processed at excessively inflated prices. If anything, Asia is a drag on the Australian trade economy for the present. It may well be a fabulous opportunity down the track, but in order to gain the sort of reputation that will make Australia attractive to Asia in years to come, we need to address our reputation in world terms now.
Australia is a country of innovation and resourcefulness in the face of dire circumstances. Yet the only research, development and employment exchanges we foster are for junior staff and graduate students. It's time we recognised the value of all facets of Australian contributions to innovation, and acted on that skill set, facilitating trade, employment and infrastructure development that demonstrates those strengths to the world.
Posted by jj at July 9, 2007 10:31 AM
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I recently saw it proposed that Tokyo and Dubai are the most advanced cities in the world right now. And similarly, that East Asia and the Gulf states are the source of most of the footloose capital in the world right now (even if they have been entrusting it to fund managers from Europe and America). While I take your point that selling resources cheap and buying them back value-added is not very impressive, it is obviously not the only sort of trade relationship with Asia that we could have. I would also suggest that building trade with Europe and America may merely increase our trade reputation with Europeans and Americans, even as the true center of gravity moves elsewhere.
Posted by: mitchell porter at July 12, 2007 7:20 PM
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