Year 11/12 Business Management, Term 4

1. TRADE

2. INTRODUCTION
 All Australians benefit from trade: an
increase in trade creates more Australian
jobs and delivers more opportunities for
Australian businesses.
 Australia is party to a broad range of trade
agreements that can impact on business
operating in international markets

3. BILATERAL FREE TRADE AGREEMENTS
 Australia has a number of existing Free
Trade Agreements (FTAs) with important
trading partners and is in negotiations and
discussions for further agreements with a
number of countries.
 The following slides are taken from: http://www.austrade.gov.au/Free-Trade-
Agreements/default.aspx

4.  An FTA is a contractual agreement between
two or more parties under which they give
each other preferential market access.
 Reduces barriers between trading nations

5.  Australia’s FTAs cover trade in goods and
services, as well as other non-tariff issues
such as the recognition of standards,
customs co-operation, the protection of
intellectual property rights and the regulation
of foreign investment.

6. AUSTRALIA’S FTAS
 Visit:
http://dfat.gov.au/trade/agreements/Pages/st
atus-of-fta-negotiations.aspx
 Shows the FTAs we currently have and are
working on

7. CURRENTLY

8. TRADE BARRIERS & RESTRICTIONS
 Trade barriers are government-induced
restrictions on international trade. The
barriers can take many forms, including the
following:
 Tariffs
 a list of taxes placed by a government on
imported or in some countries exported goods
 Customs Tariff Act 1995 indicates tariffs on
certain items from different countries

9.  Non-tariff barriers to trade - are trade barriers that
restrict imports but are not in the usual form of a tariff
 Licenses - The license system requires that a state (through specially
authorised office) issues permits for foreign trade transactions of import and
export commodities included in the lists of licensed merchandises. Product
licensing can take many forms and procedures.
 Quotas - a limitation in value or in physical terms, imposed on import and
export of certain goods for a certain period of time. This category includes
global quotas in respect to specific countries, seasonal quotas, and so-called
"voluntary" export restraints.
 Subsidies – are assistance paid to a business or economic sector or
producers.
 Voluntary Export Restraints - is a government imposed limit on the
quantity of goods that can be exported out of a country during a specified
period of time. Typically VERs arise when the import-competing industries
seek protection from a surge of imports from particular exporting countries.
 Local content requirements – quality requirements, etc, imposed by
countries
 Embargo - a specific type of quotas prohibiting the trade. As well as quotas,
embargoes may be imposed on imports or exports of particular goods,
regardless of destination, in respect of certain goods supplied to specific
countries, or in respect of all goods shipped to certain countries.
 Currency devaluation - is a reduction in the value of a currency with
respect to those goods, services or other monetary units with which that
currency can be exchanged.
 Trade restriction - is an artificial restriction on the trade of goods and/or

10. IMPORTS & EXPORTS
 Imports – a country brings in from elsewhere
(Australia imports machinery and transport
equipment, computers and office machines,
telecommunication equipment and parts; crude
oil and petroleum products)
 Exports – what we send to other countries
(Australia exports coal, iron ore, gold, meat,
wool, alumina, wheat, machinery and transport
equipment)
 https://www.cia.gov/library/publications/the-world-factbook/geos/as.html

11. http://www.trademap.org/open_acces
s/Product_SelProduct_TS.aspx

12. COUNTRY COMPARISONS
 Imports:
https://www.cia.gov/library/publications/the-
world-factbook/rankorder/2087rank.html
 Exports:
https://www.cia.gov/library/publications/the-
world-factbook/rankorder/2078rank.html

13. FIJI EXAMPLE
INFORMATION FROM: HTTPS://WWW.CIA.GOV/LIBRARY/PUBLICATIONS/THE-WORLD-FACTBOOK/GEOS/FJ.HTML

14. FOR YOUR ASSIGNMENT…
 …you need to discuss
 Any trade agreements and trade zone
restrictions for your country
 Any other trade issues related to your country
 Remember to look at it from other sides –
Australia and your country
 Useful sites:
 CIA World Fact Book
 Australia’s Dept. of Foreign Affairs & Trade