I was not trained as an economist, but after living in Australia for so many years, I believe that I can give some personal views on Australia in the midst of change.
Decades of quality life in Australia
I remember studying geography 53 years ago, learning about Australia as a country. and learning about Australia. At that time, Australia was described in textbooks as a country dominated by pastoral farming, and I was fascinated by the animal husbandry industry, shearing sheep, milking cows, and eating beef. In Hong Kong at that time, there were not many dairy products and beef imported from foreign countries in the market. In fact, agricultural products were Australia’s main production and export at that time. However, at that time, Australia’s major exports were to the United Kingdom and Europe, and Hong Kong and China rarely saw any products from Australia. It is only today that I realize that it was because Hong Kong people and Chinese people at that time had low economic capacity and could not afford to buy the expensive agricultural products from Australia, and Hong Kong and China were not the markets for Australian products at that time.
When I visited Australia for the first time 38 years ago, I had a very good impression of the major cities, and I realized that Australia was able to produce everything we needed in our daily lives, but at that time I felt that everything was very expensive. At that time, there were still four automobile factories in Australia, and my Australian brother-in-law proudly told me that Holden (actually a subsidiary of GM Motors in the US) had a history of close to 100 years, which made me believe that Australia had the technology to produce everything on its own. Later on, I realized that Holden started out as a manufacturer of car parts, and in the 1930s, with the technical support of the United States, it began to produce cars, but four years ago, Holden finally ceased production.
Thirty years ago, there were many car companies that set up factories in Australia to supply the local and overseas markets, including Toyota, Nissan, Ford, etc. However, one by one, these foreign companies ceased production and left the country, importing cheaper products from China or overseas to sell. From the time these companies entered Australia to the time they left, the Australian automobile industry has seen its ups and downs.
Cars were a necessity for Australians and there was room for them in the market. The rise and fall of the automobile industry is a testament to the high wages, declining tariffs, frequent strikes caused by strong unions, and the rise of China as world factory which monopolized the production market, and today there are basically no manufacturing industries left in Australia.
Service sector replaces agriculture and industrial production
During this period, the Australian government promoted the service sector, including professional services such as accounting, tourism and education. Australia’s traditional British education system laid the foundation for Australia’s massive export of higher education in the 1990s, when the economies of Southeast Asian countries and China took off and the demand for British education increased. Australia’s social system is connected to the United Kingdom, and the government invested in the early establishment of a number of high-quality universities and vocational training colleges, with comprehensive and advanced programs, and has a number of high-quality and academic qualifications of renowned scholars, so that students from Asian countries seeking higher education training here.
As a result, Australia has become the most popular country for students from Asian countries seeking higher education training. With the rapid expansion of Australian institutions, and recommendations from graduates from Southeast Asian countries who have previously trained here, Australia has become a major supplier of English higher education to the region. As a result, Australia has been able to attract immigrants who have lived in Australia for many years, which has boosted Australia’s productivity and consumption, as well as the development of the construction industry, resulting in continued high growth in the Australian economy.
However, the proportion of Australians attending university is not as high as in other countries, and the high proportion of Australians who find employment after secondary school, and the government’s practice of imposing higher taxes on high wage earners, have led to a lack of enthusiasm for continuing education among Australian residents. Tertiary education is increasingly becoming an export industry rather than a means of nurturing higher levels of knowledge in the local population.
In the last two to three decades, Australia’s mining industry has become the country’s largest export. Western Australia has overtaken New South Wales and Victoria as the richest state per capita, while Queensland and South Australia have both experienced economic growth. China has also become Australia’s largest trading partner, and the Australian wine and seafood industries have entered the Chinese market, maintaining Australia’s high standard of living.
Australia’s economic challenges
However, Australia’s economic development over the past few decades has benefited greatly from China’s development as the world’s factory. China’s importation of large quantities of raw materials from Australia and the arrival of large numbers of Chinese students have boosted Australia’s socio-economic activities, including an increase in Chinese tourists and high levels of consumer spending, which have helped to maintain a good standard of living for Australians. However, in the foreseeable future, China’s continued industrial development will be challenged, and Australia will have to rely on developing markets in more countries to market its existing services and to face the economic challenges that will arise.
Australia has the highest average wage in the Asia Pacific region, but productivity is declining compared to other countries, making Australia less attractive to foreign investors. However, as Australia is still a desired country for immigrants, there are many investments, talents, experiences and relationships brought to Australia through immigrants. As long as the government has appropriate policies to encourage immigrants to give full play to these advantages, Australia is still in a very good position to face the upcoming economic crisis.
In the past few years, Australia has been facing a labor shortage, and the unemployment rate has not been too high because the Australian economy is undergoing restructuring. Elderly care in social services has been undergoing significant reforms, and the aging population has allowed for a certain amount of development in elderly care services. In addition, the full implementation of the NDIS Disability Service in 2017 has resulted in a large number of additional jobs in the care sector over the past few years, with many people moving into these sectors. However, the Productivity Commission has pointed out that these jobs come from tax and the government, rather than directly from the community’s high-value jobs, to maintain the demand for these services, Australians must be able to afford the tax revenue. If one day the Australian government is unable to pay for these expenses and has to cut back heavily on these services, the unemployment rate in Australia will increase dramatically and the economy will easily fall into a crisis.
It can be said that the federal and state governments are not optimistic about the future of the Australian economy.
Opportunities for a multicultural society
As Australia has attracted a large number of immigrants from different countries over the past 20 to 30 years, it has created a rich network of talent and relationships. Australia has a strong foundation in natural resources and services, and by allowing migrants from different countries to become bridges with their countries of origin, we can build pathways from Australia’s agriculture, education, tourism, construction and other services to the rest of the world.
In Australia, we have the opportunity to be exposed to different languages, and cultures, and as long as we can build up mutual tolerance and cooperation, Australia is in a position to integrate with the global economy at a time when the United States is moving towards isolationism. For example, in recent years, Nepal has become a new market for Australian education, and this has boosted trade relations between the two countries.
Recently, there has been an increase in the number of new immigrants from Hong Kong to Australia, many of whom have extensive experience in multinational enterprises and are planning to set up their homes in Australia. As long as they can quickly integrate into the community and be absorbed into the community as a driving force for economic development, it will accelerate Australia’s economic cooperation with the rest of the world.
Although the United States is isolating itself today, in my opinion, this is an opportunity for a country like Australia, which has a rich network of people and talents, to develop. Of course, those in power must be able to grasp these advantages and opportunities, and make changes to the factors that are not conducive to Australia’s development, such as the overpowering of labor unions, in order to ensure that Australia’s development can be sustained in the future.
Mr. Raymond Chow, Publisher of Sameway Magazine