Globalisation and Australian Trade

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Globalisation &
Multiculturalism:
The Australian Experience
Griffith University
Southbank
15 September, 2010
Dr Paul Williams
Guiding Questions
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What is ‘Globalisation’?
How did Australia become
‘globalised’?
How has Australia economically
integrated with the world?
What is multiculturalism?
How did Australia become
‘multicultural’?
What are Australia’s migration
patterns?
Part One
Globalisation
Defining ‘Globalisation’
Defies easy definition
Two common uses:
 A “thing” in itself (an ‘outcome’)
 An explanation of change (a
‘process’)
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Defining ‘Globalisation’
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“A process in which the
economic, political & cultural
separation between nations is
breaking down & an
international order is emerging”
(Smith, Vromen & Cook 2006).
Defining ‘Globalisation’
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“A process occurring in the
economic, political & social
realms which is the result of the
dismantling of fixed boundaries
around nations, cultures and
economies” (Ryan et al. 1999).
What’s common in these
definitions?
Globalisation covers…
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Economic (trade, transnational
corporations [TNCs])
Technological (communication,
transport)
Media (diversity, reach)
Migratory (business, tourism,
politics)
Cultural (export of ideas, beliefs,
fashions)
Legal (international treaties, bodies)
When did Globalisation
begin?
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Many assume it began in the
1980s & 1990s, but it’s as old as
imperialism, trade & colonialism
i.e. a process begun hundreds
of years ago!
Imperialism / Colonialism
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Late 1700s – early 1900s: apex
European demand for ‘foreign’ goods
Europe’s “scramble for colonies”
British, Dutch, Spanish, Portuguese,
German, French colonise…
Africa, Asia, South America, Pacific
One cause of World War One (19141918)
Technological Globalisation –
connecting Australia to the world
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Early 1800s - Steam ships
1872 - Australia linked by telegraph line to
Java (capital could be moved in matter of
hours, not days or weeks)
1900s – telephones
1910s – cinema
1920s – propeller aircraft
1930s – radio
1950s – television
1960s – jet aircraft
1970s – fax machines
1990s – internet
2000+ - 2.0 web communications
Political & Cultural
Globalisation for Australia
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Open migration pre-1900
1914-1918 – WW1 (League of
Nations) [failed]
1939-1945 – WW2 (United Nations)
1940s on – mass migration from
Europe
1960s on – flood of US popular
culture
1966-72 – end of White Australia
Policy
1970s – migration from Asia
2000s – migration from Africa
Some Global Economic
Instruments
1944 est. International
Monetary Fund (IMF) &
World Bank
 1947 - 1995: GATT –
negotiator of lower tariffs;
various ‘rounds’
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WTO
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World Trade Organisation
(WTO) – est. 1995 – successor
to GATT
deals with rules of trade
between nations
Goal - to help producers of
goods & services, exporters &
importers conduct their business
Australia plays by WTO rules
WTO
The problem with trade
assistance…
World Bank
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Est. 1944
Source of financial & technical
assistance to developing
countries
Comprised of over 180 member
countries
IMF
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International Monetary Fund
(IMF) est. 1944
More than 180 members
Promotes international monetary
cooperation & exchange stability
Provides temporary financial
assistance to countries with
balance of payments problems
Dissent
Both the World Bank and IMF – as
symbols of globalisation &
capitalism – are objects for
dissent and protest
Post-war global economic
developments
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1950s – postwar reconstruction
1960s – GATT moves to freer
trade
1971 – end of Bretton Woods
agreement
Early 1970s – oil shocks
(quadruple crude oil costs)
Ushers in new economic thinking
in West (incl. Australia)
Economic Globalisation for
Australia
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1901–1970s - Australia’s trade &
agriculture ‘protected’ i.e. high
tariffs, subsidies, quotas
Early 1970s – oil shocks
(quadruple crude oil costs –
‘stagflation’)
New economic problems
require new economic
thinking
Economic Globalisation for
Australia
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1979 – Margaret Thatcher (UK)
1981 – Ronald Reagan (US)
1983 – Hawke / Keating (Aust.)
End of ‘Keynesian’ economics
Rebirth of ‘supply-side’
economics
Economic changes in
Australia since 1980s…
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In theory, smaller government
(in practice, still a welfare state)
Lower income taxes
Lower public spending
Currency deregulation (1983)
Deregulated labour market
Reduction of tariffs
Increased foreign investment
Sale of public-owned businesses e.g.
Qantas, Telstra, Commonwealth Bank
i.e. a ‘freer’ economy, BUT…
Some say GFC inevitable outcome of
globalisation
Australia & the Global
Financial Crisis
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Collapse of Lehmann Bros Sept.
08
Grim forecasts for Australia
Rudd’s anti-neo-liberal essay
Rudd Government pre-empts
stalled demand:
Dec 2008 – 1st ‘stimulus
package’ = $10.4bn (lump sum
payments to seniors, families; $
for auto industry, local councils)
Australia & the Global
Financial Crisis
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Feb 09 – 2nd ‘stimulus package’ =
$42bn (lump sum payments to most
taxpayers up to $950; $26bn for
infrastructure esp. schools (BER);
$2.7bn for small business)
OECD says these packages lowered
Australian unemployment by 2 %
Similar ‘bailouts’ in UK, US & Europe
Is this the end of neo-liberalism & a
new era of ‘big government’?
Globalisation creates winners
& losers
Winners include…
 Highly skilled white-collar
workers in finance & IT
industries
Losers include…
 Farmers, lower skilled bluecollar workers in manufacturing
industries
Growth in Australian
Finance Industry
Winners & Losers…
Winners & Losers
Global winners…one
analysis
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Recent per capita Gross
Domestic Product (GDP) of
developing nations
China: 11.1 % p.a.
India: 9.7 %
Philippines: 7.5 %
Malaysia: 5.4 %
Turkey: 5.2 %
Global losers…another analysis
North-South divide grows (gap
between rich & poor nations)
 1960 - top 20 % in the world
had income x 30 that of bottom
20 %
 1970 - 32 times
 1980 - 45 times
 1989 - 59 times
 2010 - 74 times
(some dispute this gap)
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Global losers…
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The richest 1 per cent of people
in the world receive as much as
the bottom 57 percent
i.e. < 50 million richest receive
as much as 2.7 billion poor
(Milanovic 2002, p.50)
The ‘North-South Divide’
(or ‘Development Gap’)
The Global Income Gap
Green = High; Yellow = Mid; Red = Low
The Global Digital Divide
The Energy Divide
(GHGs & Climate Change
challenges)
Anti-globalisation
movements
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Protest at Group of Eight (G8)
meetings
Anti-IMF; anti-World Bank
Pro-debt cancellation
Major protests at Madrid (1994);
Seattle (N30 1999); Genoa
(2001); Edinburgh (2005)
Protests…
Protests…
Protests…
Australia’s trade patterns…
1788-1901: colonies trade
with UK
 1901-1945: trade mostly with
U.K
 1945 - present: mostly with
US, Asia & EU
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Australia’s trade patterns…
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Heavy reliance upon primary
products
1901 - 50: Agriculture
1950s - present: Minerals
1945 – early 1970s: high
international demand for
Australian products esp. wool,
wheat, coal; iron ore
1980s – on: reduction in tariffs
Tariff reduction…
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Until 2005: Cars - 15% tariff
From 2005: Cars - 10%
2003-2013: TCF: 5 % to 17.5%
Australia’s biggest trading
partners…
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EU (incl. UK)
USA
Japan
China & Hong Kong
Taiwan
South Korea
Singapore
Malaysia
India
Thailand
What does Australia import?
Food – $5 bn
 Fuels – $10 bn
 Manufactured goods – $16
bn
 Machinery & vehicles – $60
bn
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What does Australia export?
Food ($18 bn)
 Fuels ($20 bn)
 Manufactured goods ($11
bn)
 Machinery & vehicles ($12
bn)
 Trade deficits
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Australia’s biggest
exports…
Coal
 Tourism
 Iron-ore
 Education
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Foreign Investment in
Australia
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Today, about 30% foreign-owned
equity in Australia
1% of all firms (or 8,000) foreignowned
Employ 750,000 people
Add $78 billion to economy
Esp. important to mining
Monitored by Foreign Investment
Review Board (FIRB), over which
Treasurer has veto power
Foreign Investment…
Current or coming Free
Trade Agreements (FTAs)
Australia's Free Trade
Agreements
 Singapore - Australia
 Thailand - Australia
 Australia - United States
 Australia New Zealand
 Australia-Chile
Key foreign investors…
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US (half of all foreign
businesses)
UK (make more profits than US
firms)
Also New Zealand, South Africa,
Hong Kong, Germany & Japan
Foreign Investment
Arguments for:
 Access to capital (especially risk
capital)
 Provides overseas markets;
infrastructure; skills; technology
Foreign Investment
Arguments against:
 Outflow of dividends
 Displaces domestic companies form
profitable sectors (much FI is merely
acquisition)
 Does not transfer technology or skills
 Inhibits growth of indigenous firms
 Loss of control of companies
 Loss of local culture
Big Questions…
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Is globalisation inevitable?
Does globalisation ‘erode’ the
sovereignty of individual nationstates?
Do nations have a say in how
“connected” they are to the
world?
Globalisation & Sovereignty
Thesis:
 As globalistion advances,
national borders become less
important
 Individual governments become
less powerful
 Transnational corporations
become more powerful
For loss of sovereignty
Economy:
 National economies are not islands –
affected by international
developments
 e.g. currency exchange rates; terms
of trade; FTAs, WTO, IMF, World
Bank (can impose conditions e.g.
Thailand in late ’90s)
 Australia’s future dictated by trade
blocs e.g. EU, ASEAN, NAFTA,
APEC, Aust-US
 Cannot control TNCs completely
For loss of sovereignty
For loss of sovereignty
Politics
 International obligations on labour,
environment & human rights (UN,
ILO, Amnesty, Red Cross)
Military
 Maintenance of defence obligations
(e.g. ANZUS), Iraq, Afghanistan
 Peace-keeping duties (East Timor,
Solomon Islands, Bougainville)
For loss of sovereignty
For loss of sovereignty
Cultural
 Proliferation of global media (WWW,
world music, newspapers, cinema
[Hollywood & ‘Bollywood’])
Social
 Expenditure on social infrastructure
limited by need to remain
internationally competitive, especially
since 1980s i.e. lower pensions etc
Against loss of sovereignty
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Nations make conscious choice to
pursue free trade
Control over slowing or reversing
free trade (see France & US)
Control over TNCs at local level e.g.
over investment, mergers, labour,
health & safety, environmental
protection
Control over local media ownership
& content
Control over immigration
Democracy Vs Terrorism?
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Does globalisation mean
‘westernisation’ (or
‘McDonaldsisation’)?
Does this mean the inevitable
spread of western liberal
democratic values?
Or has globalisation (post-Cold
War) helped the spread of
terrorism?
Part Two
Multiculturalism in
Australia
Defining Multiculturalism
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A disputed, emotional term
Originated in bicultural Canada 1960s
“Recognition of the diverse cultures of a plural
society based on three principles:
1. We all have an ethnic origin (equality)
2. All our cultures deserve respect (dignity)
3. Cultural pluralism needs official support”
(Parliament of Canada 1987)
i.e. cultures existing side by side (NOT a
‘melting pot’)
Defining Pluralism
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“A position in society in which
political and economic power is
diffused and fragmented, rather
than concentrated in one class
or élite group.”
(Boyce et al 1980)
Origins of Australian Human
Settlement
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Indigenous (Aboriginal and
Torres Strait Islanders)
At least 30,000 years ago, up to
120,000 years ago
Travelled on land bridge from
Southeast Asia, and land bridge
to Tasmania
Australia and her
Neighbours
Timeline of Attitudes to
Indigenes
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1788 to mid 1800s – subjugation
(occasionally extermination)
Mid 1800s to mid 1960s –
paternalism & assimilation
1960s-1980s – integration
1990s – self-determination
(ATSIC 1990; Mabo 1993)
The Australian Settlement
Australia in 1901 founded on 5
bipartisan pillars (Kelly 1992)
1. White Australia (WAP)
2. Industry Protection
3. Wage Arbitration
4. State Paternalism
5. Imperial Benevolence
 By 1980s, all had been slowed
or reversed
Timeline of Australian
Migration
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1788 – 1840: British & Irish
convicts and free settlers
Early 1800s: indentured
Chinese labourers
1830s: German settlement in SA
& Qld
Mid 1800s: Italians in rural NSW
& north Qld
Timeline of Australian
Migration
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1850s to late 1800s: Chinese to
gold rushes in NSW, Victoria &
Qld
Mid to late 1800s: Kanaks in Nth
Qld
1901: WAP introduced on
Federation
1946 on: southern European
migration (Greeks & Italians)
Postwar resettlement
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1945 – Australia’s population = 7
million
1940s - special report finds Australia
in “urgent need” of larger population
for development & self-defence
(“populate or perish”)
Target ‘til 1972: 1% p.a. increase in
population through increased
immigration
Slows during 1972-75, resumes after
1975
Ben Chifley
& Arthur Calwell
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Ben Chifley
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Arthur Calwell
Migration Categories
3 main categories of migration:
 Economic (skill-based)
 Family reunion
 Humanitarian (refugees)
Postwar resettlement
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United Kingdom - assisted passages (‘Ten
Pound Poms’)
Assisted migration also from Malta, The
Netherlands, Italy, Greece, West Germany,
Turkey, Austria, Spain, Belgium &
Yugoslavia
So-called “New Australians” (a derogatory
term today)
6.5 million people migrated to Australia
since 1945
2010 - Australia’s population = 22.5 million
Snowy Mountains HydroElectric Scheme
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25 years to build (1949-74)
Cost (at that time) of AUD$800
million (today = AUD$6 billion)
100,000 people employed from
at least 30 different nationalities
70% of all the workers were
migrants
Snowy Mountains HydroElectric Scheme
Timeline of Australian
Migration (con’d)
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1950s – Baltic & Eastern
European (anti-communist)
Late 1950s – end to ‘Dictation
Tests’
1966 – limited non-European
migration
1973 – multiculturalism & end of
WAP
Timeline of Australian
Migration (con’d)
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Mid 1970s - SBS Radio
Late 1970s – Vietnamese migration
1980s – Mainland Chinese
Early 1980s – SBS TV
1988 – John Howard (PM 1996-2007)
expresses concerns over Asian migration
2000s – African (sub-Saharan)
Net overseas migration: 1992-93 = 30,042;
2006-07 = 177,600
2009 – Rudd Gov’t cuts ‘permanent skilled
migration program’ intake from 133,500 to
115,000.
Population now a political issue!
Prime Minister Hawke
1983-91
Hawke’s (1989) three dimensions
of Multiculturalism policy:
 Cultural identity
 Social justice
 Economic efficacy
Xenophobia:
Fear of Foreigners
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Fears of job losses (economic
sustainability)
Fears of urban decay
(infrastructural sustainability)
Fears of water shortage
(ecological sustainability)
Fears of lost Australian identity
(cultural sustainability)
Political backlash
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1997: xenophobia exploited by
Pauline Hanson & One Nation Party
1998: Qld state election = 22.7 %
vote
Declines by 2001
Liberal-National Gov’t assumes
tough line on immigration as a result
Labor 2007-09 also adopts tough
rhetoric)
A New PM - 2010
A New Xenophobia?
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Late 2001 – MV Tampa, SIEV IV
& 2001 federal election
“Pacific Solution” (Nauru)
“We will decide who comes to
this country, and the
circumstances under which they
come.” (PM John Howard 2001 election
campaign)
SIEV IV – 6 October, 2001
A New Xenophobia?
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Post 9/11 & post-Bali bombing
(2002) antagonism against Muslim
extremists
Cronulla riots (Christmas 2005)
New PM Julia Gilard does not
support a ‘big’ Australia
Summary & Conclusions
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Globalisation is ‘international interconnectedness’
Australia in past 60 years has changed
politically, economically, socially and
culturally
Australia was once a protected economy;
since 1980s an open economy
Australia until 1950s almost totally British
Since 1950s, non-British migration
changed the face of Australia
Immigration and globalisation will continue
for Australia
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