Australia and trade


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Australia and trade

  1. 1. INTRODUCTION• Australia comprises of the mainland of the Australian continent, the island of Tasmania and numerous smaller islands.• It is the worlds sixth largest country by total area.• Australia is the world’s 12th largest economy.• It has the worlds 5th largest per capita income.• Australias military expenditure is the world’s 13th largest.• Australia ranks highly in many international comparisons of national performance.• Australia is a member of the G20, OECD, WTO, APEC, UN, Common Wealth, ANZUS & the Pacific Islands Forum.
  2. 2. COUNTRY HISTORY• Australias first inhabitants: The Aboriginal people(50,000 - 60,000 years ago).• 1640: Dutch are known to have explored the coastal regions .• 1770: Captain James Cook is credited with Australias discovery.• 1788: The first European settlement in Australia.• 1830: established as a penal colony with the no. of free settlers increasing.• 1852: Transportation of convicts to the eastern colonies was abolished.• 1868: Transportation of convicts to the western colonies was abolished.
  3. 3. Cultural analysisCulturalAnalysis
  4. 4. GEOGRAPHICAL SETTING• Island continent• Worlds sixth largest country (7,682,300 sq km).• Latitude: 27°00 South• Longitude: 133°00 East• Capital: Canberra• Climate: temperate weather for most of the year.• Topography:i. Sandy eastern coastal plainii. Eastern highlandsiii. Central plainsiv. Western plateau
  5. 5. SOCIAL INSTITUTIONSI. FAMILY: no distinction between men’s and women’s work.II. EDUCATION: Australia follows the three-tier model.III. LITERACY RATE: Age 15 and above can read and write , 99% of population is educated.
  6. 6. SOCIAL INTITUTIONSIV. POLITICAL SYSTEM: Two party system in which voting is compulsory.V. LEGAL SYSTEM:• 9 legal systems( 8 state and territory systems & 1 federal system)• State and territory criminal laws that mainly affect the day-to-day lives of most Australians.IV. SOCIAL ORGANISATION: Four tier structure
  7. 7. SOCIAL INSTITUTIONSVII.RELIGION: Column1 christianity 61.1% no religion 22.3% undeclared 9.4% buddhism 2.5% islam 2.2% hinduism 1.3% other religions 1.2%
  8. 8. LIVING CONDITIONS• Diet and nutrition:i. significant percentage of Australians are overweight and obese and suffer from conditions associated with diets of excess.ii. Australia has the highest rates of skin cancer in the world• Clothing:
  9. 9. LIVING CONDITIONS• Sports Cricket Rugby Phar Lap
  10. 10. LIVING CONDITIONS• Recreational Activities: Beaches Outback Scuba Diving Skiing Surfing Sailing Whale Watching Aboriginal Culture
  11. 11. LIVING CONDITIONS• Social securities: refers to a system of social welfare payments provided by Commonwealth Government of Australia. These payments are administered by the Department of Human Services• Health care: provided by both private and government institutions. The Minister for Health and Ageing, administers national health policy, elements of which (such as the operation of hospitals) are overseen by individual states.
  12. 12. LANGUAGE• OFFICIAL LANGUAGE: English• LANGUAGES: english 78.5% chinese 2.5% italian 1.6% greek 1.3% arabic 1.2% vietnamese 1%
  13. 13. • Current population: 22,015,576 country comparison to the world: 53• Growth rate : 1.126% country comparison to the world:105• Birthrate: 12.28 births/1,000 population country comparison to the world: 161
  14. 14. • Distribution of population: – Age: – Ethnic groups: White 92%, Asian 7%, Aboriginal and other 1% – Geographic areas: Urban population 89% of total population – Net migration rate: 5.93 migrant(s)/1,000 population (2012 est.)country comparison to the world: 17
  15. 15. • GDP: 3.3% (2012 est.) country comparison to the world: 103• Personal inc. per capita: $42,400 (2012 est.) country comparison to the world: 20• Inflation rate: 2.1% (2012 est.) country comparison to the world: 33• Labour force: 12.27 million (2012 est.) country comparison to the world 43
  16. 16. • Transportation: – Modes: • Airports: 467 (2012)country comparison to the world:18 • Pipelines: Gas 27,900 km; liquid petroleum gas 240 km; oil 3,257 km; oil/gas/water 1 km (2010) • Railways: 38,445 km country comparison to the world: 7 • Roadways: 823,217 km country comparison to the world: 9 • Waterways: 2,000 km (mainly used for recreation on Murray and Murray-Darling river systems) (2011) country comparison to the world: 43 – Ports and terminals: Brisbane, Cairns, Dampier, Darwin, Fremantle, Gl adstone, Geelong, Hay Point, Hobart, Jervis Bay, Melbourne, Newcastle, Port Adelaide, Port Dalrymple, Port Hedland, Port Kembla, Port Lincoln, Port Walcott, Sydney
  17. 17. • Communication system: • Telephones - main lines in use: 10.57 million (2011) country comparison to the world: 20 • Telephones - mobile cellular: 24.49 million (2011) country comparison to the world: 43 • Internet country code: .au • Internet hosts: 17.081 million (2012) country comparison to the world: 8 • Internet users: 15.81 million (2009) country comparison to the world: 25 • Broadcast media: The Australian Broadcasting Corporation (ABC) & Special Broadcasting Service (SBS)
  19. 19. Bop situation• Australia has a balance of payments that is more than 7 per cent of GDP negative.• In trade terms, the Australian economy has had persistently large current account deficits for more than 50 years. One single factor that undermines balance of payments is Australias narrow export base.• Dependent upon commodities, the Australian government has endeavoured to redevelop the Australian manufacturing sector. This initiative, also known as microeconomic reform, has helped Australian manufacturing to grow from 10.1% in 1983-1984 to 17.8% in 2003-2004.• There are other factors that have contributed to the extremely high current account deficit that Australia has today. Lack of international competitiveness and heavy reliance on capital goods from overseas might increase Australias current account deficit in the future.
  20. 20. Counter trading– develop new markets (71%), – Increased costs (68%),– increased sales potential (67%), – involved complex negotiations (64%),– built long-term strategic alliances – raised problems with pricing brought (62%), difficulties in re-selling countertraded goods (59%),– Strengthens the firms competitive position (61%), – consumed time in negotiations (55%),– increased the potential for market share (59%), – could find no use for countertraded goods in-house (55%)– developed markets for new products and/or services (55%),
  21. 21. Counter trading• Forms of Countertrade Practised – Counter purchase, offset and switch are the major forms of countertrade. Barter and compensation occurred much less frequently.• Countries Involved – Indonesia, India, China, U.S.A., U.K., Burma, Japa n, and Malaysia, Argentina, Brazil, Hungary, Iran, Libya and Syria.• Product Categories Countertraded – industrial raw materials, components, – agricultural raw materials. – Semi-finished and finished goods occurred much less frequently in countertrade. – inputs and consumer goods are the primary Australian countertrade imports.
  22. 22. Foreign aid• Australia does not receive international aid. If at all the need funds, they source it from: – Private entities in Australia – Private Parties abroad• The 2012-13 Budget will increase Australia’s Official Development Assistance (ODA) to $5.2 billion
  23. 23. Foreign investment• Australias abundant and diverse natural resources attract high levels of foreign investment and include extensive reserves of coal, iron ore, copper, gold, natural gas, uranium, and renewable energy sources.• The level of FDI in Australia is estimated to have grown by about 60% in the five years to 2010. The largest contributors to the increase were mining, manufacturing and finance and insurance
  24. 24. Industry $ Million % share of totalAgriculture, forestry and 669 0.1fishingMining 151,065 31.9Manufacturing 88,481 18.7Electricity, gas and water 9,587 2.0Construction 16.886 3.6Wholesale and retail trade 44,500 9.4Accommodation, cafes and 5,855 1.2restaurantsTransport and communication 43,331 9.1Finance and insurance 67,653 14.3Property and business services 25,174 5.3Other services 1,627 0.3Unallocated 18,845 4
  25. 25. Foreign Direct Investment• Stock of direct foreign investment - at home: – $598.7 billion• Stock of direct foreign investment - abroad: – $496.4 billion
  26. 26. Major exports• Exports: – $263.9 billion (2012 est.)• Exports - commodities: – coal, iron ore, gold, meat, wool, alu mina, wheat, machinery and transport equipment• Exports - partners: – China 27.4%, Japan 19.2%, South Korea 8.9%, India 5.8% (2011)
  27. 27. Major imports• Imports: – $258.1 billion (2012 est.)• Imports - commodities: – machinery and transport equipment, computers and office machines, telecommunication equipment and parts; crude oil and petroleum products• Imports - partners: – China 18.5%, US 11.4%, Japan 7.9%, Singapore 6.2%, Germany 4.7%
  28. 28. Exchange ratesAustralian dollars (AUD) per US dollar – 0.963 (2012 est.) – 0.9695 (2011 est.) – 1.0902 (2010) – 1.2822 (2009) – 1.2059 (2008)
  29. 29. Trade Restrictions• Trade Policy – Australia began to reduce its tariff including in its most protected industries such as automobiles and textiles in the 1980s. – The Australian economy has since reaped the rewards of tariff reduction through lower prices of imported business inputs, increased productivity and improved international competitiveness.• Australian Free Trade Agreements – Australia has concluded different free trade agreements with New Zealand, Singapore, the USA and Thailand. – Currently it is pursuing free trade agreements with China, Malaysia and ASEAN, Japan, the Gulf Cooperation Council and Chile, and conducting a joint study on an agreement with South Korea• Product Standards and Consumer Protection – Australia is a signatory to the WTO Standards Code and has acceded to the WTO Agreement on Technical Barriers to Trade. – However, Australia still maintains some restrictive standards requirements particularly quarantine and health restrictions that have an impact on the free flow of goods.
  30. 30. Import Controls• There are no special requirements for applying an import licence, nor are there any quotas on imports. However, under the Customs (prohibited Imports) Regulations, controls take the form of – – a) an absolute prohibition meaning that import of these goods is banned in any circumstances; and – b) a restriction where imports are allowed only if written authorisation is obtained from the relevant authorities, or if compliance with certain regulations is met. For some commodities, import permits are required to facilitate clearance of goods.• Items subject to control include animals and animal products; narcotics, psychotropic and therapeutic drugs; certain chemicals and primary commodities; firearms and certain weapons; motor vehicles; and certain dangerous goods.
  31. 31. Embargoed Countries• Afghanistan • Lebanon• Australia Sanctions • Liberia• Balkans • Libya• Côte d’Ivoire • Myanmar• Congo • North Korea• Eritrea • Somalia• Fiji • Sudan• Iran • Syria• Iraq • Zimbabwe
  32. 32. Tariffs & custom Duties• Customs Valuation and Tariff – Australia adopted the Harmonised Commodity Description and Coding System (HS). – About 86% of tariff rates now range between zero and 5%, except certain automobile products and the textile, clothing and footwear commodities. – The average applied most-favoured-nation (MFN) rate for industrial products is 4.6%, while the applied MFN tariff for agricultural products is less than 1%.• Customs Clearance – Importers wishing to clear their own goods should contact the Customs Information and Support Centre for advice on Customs requirements and operating hours. – Customers should be aware of their obligations and base on their assessments of import procedures. Penalties may be imposed for the submission of incorrect or misleading information. – Controls on certain goods are maintained to meet health and safety requirements or labelling, packaging or technical specification requirements.• ST and Other Taxes – Goods and services tax @ 10% (GST) was introduced in 2000 and is payable on most goods and services imported into Australia except for some essential commodities.
  33. 33. Channels of distribution• Import export agents• Wholesale middlemen• Warehousing• Retailers• Penetration of urban and rural mkts
  35. 35. Introduction Of the product and company
  36. 36. Introduction Of the product and companyC A LO S HI VERA vent ur e st ar t ed by :I sha Sanghr aj kaPooj a Pat elPoor vi Shukl aR adhi ka MenonA com pany est abl i shed i n 2010 andunder t akes expor t of var i ous f l avor edt eas t o count r i es l i ke A er i ca, U t ed m niK ngdom U E and i s cur r ent l y pl anni ng i , At o ent er t he A r al i an M ket . ust ar
  37. 37. PRODUCT1. Ayurvedic Herbal Tea• Contains of Indian herbs like Tulsi, Banafsha, Mulathi, Jaiphal, etc
  38. 38. 2. Masala TeasAvailable in 3 flavors :• Cinnamon• Cardamom• Ginger
  39. 39. Product PackageSet of 15 Tea bags (AU ) : 7 DPow ed M xt ur e (100gm D 11 der i )(AU ):
  40. 40. Resource requirement Fi nance (Sel l i ng)• R m er i al – R 900,000 aw at s• Adver t i si ng – R 10,00,000 s – Tv C m ci al R 5,50,000 om er s – H di ngs R 2,50,000 oar s – C m ssi on – R 200,000 om i s• D st r i but i on – R 15,00,000 i s
  41. 41. Resource requirement Personnel I. 50 factory wokers II. 5 export/import agents (in India) Production capacity I. 3000 per month (includes buffer stock 200 units)
  42. 42. Product• Core – flavored health teas• Augmented – flavor names• Expected – iced teas, new improved flavours AUGMENTED EXPECTED CORE
  43. 43. Packaging for shipping• Marking and labeling• Containerization
  44. 44. Market
  45. 45. Consumer buying habits– Small quantities– Frequent purchases– Quick mix– Lot of importance to flavour– Health conscious– Switching from coffee for health reasons
  46. 46. • Stationery products Globusstationery Schools and Offices
  47. 47. Distribution channel• Typi cal r et ai l out l et s – W w t hs ool or – Saf ew ay – C es Super m ket ol ar – Ar r ow Super m ket ar – Foodw ks or – C co ost
  48. 48. Australian Agent – Stuart Alexander and Co.• An Australian- based international marketing and importing company, known for importing and marketing
  49. 49. Promotion• Advertising - Ideaworks• Target market – 20years and above (mainly the major cities)• Positioning – Flavorful and healthy choice• Sales promotion: – Free Samples with The Australian (newspaper) – Tie up with Tv Shows – TV Commercial – Hoardings – Stalls in malls and supermarkets – website
  50. 50. Our product and our competitors productBrand name CHAI LOVERS CHAIFeatures Ayurvedic Tea & Indian Spice Mix & Organic Tea Masala flavorsPackage 50gm, 100gm 50gm, 100gmPrices AUD 7, AUD 11 AUD 7.50, AUD 12Promotion methods Stalls, tea sets, newspapers, Tea shirts & Festivals tv showsDistribution channels Stuart Alexander Cater for events, supermarkets
  51. 51. REGULATIONS• Tea is among the restricted items that can imported into Australia• Customs requirements: All goods imported into Australia must be cleared by the Australian Customs and Border Protection Service .• Quarantine requirements: Finding out about quarantine regulations is a must when importing goods. If the goods are subject to quarantine regulations, you need to apply for an importing permit and allow time for quarantine.• If you import plant, animal, mineral or human products, Australian Quarantine & Inspection Service (AQIS) will need to inspect and/or treat your products for pests or diseases.• Assistance for importers: Investigate whether concessions are available for your import. Concession schemes may allow you to import goods for free, at a reduced rate or on a deferred duty payment.• Labelling requirements: You may need to label your imported goods in a certain way, in addition to the general labelling regulations set out by the Competition and Consumer Act 2010 (CCA).