Globalization  and  Australia Alan Oxley Australian APEC Centre, Monash www.worldgrowth.org
Three aspects <ul><li>The impact of  globalization </li></ul><ul><li>What is globalization </li></ul><ul><li>Impact on Aus...
What is  the impact  of  globalization?
The wealth gap is narrowing <ul><li>Gap between richest 20 percent and poorest 20 percent falls   - from 15 to 1 in 1970  ...
Incidence of poverty is falling 24% 28.3% WORLD 46.3% 46.6% Sub-Saharan Africa 5.1% 0.2% Europe/Central Asia 11.3% 23.9% (...
Quality of life improving 67%bb 80% Global literacy 67 44 Infant survival rates/1000 66 58 Average life expectancy 810m 92...
Countries open to trade grow faster
The evidence shows that the poorest people within countries share in the gains from  national  income growth. Generally, a...
What is Globalization? <ul><li>Defining it </li></ul><ul><li>The drivers </li></ul><ul><li>The effects </li></ul>
Defining globalization <ul><li>An open economic system </li></ul><ul><li>Non-discrimination </li></ul><ul><li>Global brand...
The Drivers  <ul><li>Cheap travel </li></ul><ul><li>Trade liberalization </li></ul><ul><li>Information technology </li></u...
Exports % share of world production
Annual % Growth of trade and GDP 1959 – 96
US investment now more global <ul><li>Percentage of foreign stocks held by US investors </li></ul>Ten percent One percent ...
Effects of globalization <ul><li>On business </li></ul><ul><li>On work </li></ul>
Effects of globalization on business <ul><li>Cheap offshore production </li></ul><ul><li>Reduced transport costs </li></ul...
Bigger and smaller <ul><li>Greater scale in manufacturing -  commodities are globally priced </li></ul><ul><li>Specializat...
New importance of Brands <ul><li>Selling Fords like Coca Cola?  </li></ul><ul><li>-  Ford sold its components business for...
Globalized business <ul><li>Greater specialization of production - Hewlett Packard </li></ul><ul><li>More outsourcing – So...
Effects of globalization on work <ul><li>Jobs in services rather than manufacturing </li></ul><ul><li>Workers  provide ser...
A globalized world <ul><li>Greater freedom of movement of goods, services, capital, people </li></ul><ul><li>Global citize...
Australia and Globalization <ul><li>How is Australia positioned? </li></ul><ul><li>Examples of globalized industries </li>...
Australia: globalization’s child <ul><li>Australia has grown on - trade - foreign investment </li></ul><ul><li>- immigrati...
Australia’s position <ul><li>Openness </li></ul><ul><li>IT/E readiness </li></ul><ul><li>Culture </li></ul>
Australia’s openness <ul><li>One of the most open economies in the world - average tariffs – 5 percent - open financial an...
Australia’s IT/Ereadiness Source: Economist Intelligence Uni t 7.87 7 Singapore 7.89 6 Sweden 8.07 5 Norway 8.09 4 Canada ...
Australia’s globalized economy <ul><li>Global industries - mining and agriculture </li></ul><ul><li>Services – distributio...
Manufacturing exports
Globalized industries <ul><li>Toyota - manufactures and exports a   global car </li></ul><ul><li>Howe Leather – a tier one...
The future <ul><li>The information Age - computing power continues to   expand exponentially </li></ul><ul><ul><li>- More ...
Australia ready to thrive <ul><li>Globally oriented economy </li></ul><ul><li>High adaptation of IT </li></ul><ul><li>Work...
www.globalizationguide.org
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Globalizationvic

  1. 1. Globalization and Australia Alan Oxley Australian APEC Centre, Monash www.worldgrowth.org
  2. 2. Three aspects <ul><li>The impact of globalization </li></ul><ul><li>What is globalization </li></ul><ul><li>Impact on Australia </li></ul>
  3. 3. What is the impact of globalization?
  4. 4. The wealth gap is narrowing <ul><li>Gap between richest 20 percent and poorest 20 percent falls - from 15 to 1 in 1970 - to 13 to 1 in 1997 - i.e. by 10 percent </li></ul>
  5. 5. Incidence of poverty is falling 24% 28.3% WORLD 46.3% 46.6% Sub-Saharan Africa 5.1% 0.2% Europe/Central Asia 11.3% 23.9% (- China) 15.3% 26.6% East Asia 1998 1987
  6. 6. Quality of life improving 67%bb 80% Global literacy 67 44 Infant survival rates/1000 66 58 Average life expectancy 810m 920m People undernourished 1990’s 1970
  7. 7. Countries open to trade grow faster
  8. 8. The evidence shows that the poorest people within countries share in the gains from national income growth. Generally, as a country ’s average income rises,the poorest share proportionately in those gains. More specifically,the poorest 20 per cent in an economy gain by the same percentage as the country does. And as a country ’s average income per person rises,the proportion of its population living in extreme poverty falls.
  9. 9. What is Globalization? <ul><li>Defining it </li></ul><ul><li>The drivers </li></ul><ul><li>The effects </li></ul>
  10. 10. Defining globalization <ul><li>An open economic system </li></ul><ul><li>Non-discrimination </li></ul><ul><li>Global brands </li></ul><ul><li>Global structures </li></ul>
  11. 11. The Drivers <ul><li>Cheap travel </li></ul><ul><li>Trade liberalization </li></ul><ul><li>Information technology </li></ul><ul><li>High technology </li></ul>
  12. 12. Exports % share of world production
  13. 13. Annual % Growth of trade and GDP 1959 – 96
  14. 14. US investment now more global <ul><li>Percentage of foreign stocks held by US investors </li></ul>Ten percent One percent 1996 1975
  15. 15. Effects of globalization <ul><li>On business </li></ul><ul><li>On work </li></ul>
  16. 16. Effects of globalization on business <ul><li>Cheap offshore production </li></ul><ul><li>Reduced transport costs </li></ul><ul><li>Virtual communication </li></ul><ul><li>Standardization of logistics </li></ul><ul><li>Global marketing </li></ul>
  17. 17. Bigger and smaller <ul><li>Greater scale in manufacturing - commodities are globally priced </li></ul><ul><li>Specialization in manufacturing </li></ul><ul><li>Globalization of specialist manufacturing </li></ul>
  18. 18. New importance of Brands <ul><li>Selling Fords like Coca Cola? </li></ul><ul><li>- Ford sold its components business for $1.5 billion - That business, Visteon, supplied 22% of a new Ford vehicle </li></ul><ul><li>- Ford spent $9 billion buying brands: Jaguar and Volvo </li></ul>
  19. 19. Globalized business <ul><li>Greater specialization of production - Hewlett Packard </li></ul><ul><li>More outsourcing – Soap and medicines </li></ul><ul><li>Greater increase in brand values - LG </li></ul><ul><li>New technology niches – steel mini mills </li></ul>
  20. 20. Effects of globalization on work <ul><li>Jobs in services rather than manufacturing </li></ul><ul><li>Workers provide services rather than “do a job” </li></ul><ul><li>End of “lifetime” employment </li></ul><ul><li>Individuals manage more of their own affairs </li></ul>
  21. 21. A globalized world <ul><li>Greater freedom of movement of goods, services, capital, people </li></ul><ul><li>Global citizens </li></ul><ul><li>The Information Age – has only just begun </li></ul>
  22. 22. Australia and Globalization <ul><li>How is Australia positioned? </li></ul><ul><li>Examples of globalized industries </li></ul><ul><li>The Future </li></ul>
  23. 23. Australia: globalization’s child <ul><li>Australia has grown on - trade - foreign investment </li></ul><ul><li>- immigration - adaptation of technology Australia is the branch office model of development </li></ul>
  24. 24. Australia’s position <ul><li>Openness </li></ul><ul><li>IT/E readiness </li></ul><ul><li>Culture </li></ul>
  25. 25. Australia’s openness <ul><li>One of the most open economies in the world - average tariffs – 5 percent - open financial and telecoms - open to foreign investment </li></ul>
  26. 26. Australia’s IT/Ereadiness Source: Economist Intelligence Uni t 7.87 7 Singapore 7.89 6 Sweden 8.07 5 Norway 8.09 4 Canada 8.10 3 UK 8.29 2 Australia 8.73 1 US Score (of 10) Ranking
  27. 27. Australia’s globalized economy <ul><li>Global industries - mining and agriculture </li></ul><ul><li>Services – distribution, logistics, transport, financial services </li></ul><ul><li>Manufacturing – a new contender </li></ul>
  28. 28. Manufacturing exports
  29. 29. Globalized industries <ul><li>Toyota - manufactures and exports a global car </li></ul><ul><li>Howe Leather – a tier one supplier </li></ul><ul><li>to Ford </li></ul><ul><li>Rosemount/Southcorp – exporter & offshore producer </li></ul><ul><li>Westfield – real estate management </li></ul>
  30. 30. The future <ul><li>The information Age - computing power continues to expand exponentially </li></ul><ul><ul><li>- More global distribution of activity </li></ul></ul><ul><ul><li>- Greater interconnectivity </li></ul></ul><ul><ul><li>- Bigger organizations </li></ul></ul><ul><ul><li>- Greater fragmentation </li></ul></ul><ul><ul><li>- Greater personal freedom </li></ul></ul>
  31. 31. Australia ready to thrive <ul><li>Globally oriented economy </li></ul><ul><li>High adaptation of IT </li></ul><ul><li>Workforce adjusting </li></ul><ul><li>Open society </li></ul>
  32. 32. www.globalizationguide.org
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