Country Brief: Australia

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March 17, 2005

Australia is a democratic, federal-state system that recognizes the British monarch as sovereign.  In 1999, a referendum to change Australia's status from a commonwealth headed by the British monarch to a republic was defeated.[1] There are six states in Australia: New South Wales, Tasmania, Western Australia, South Australia, Victoria, Queensland, and two self-governing territories: the Northern Territory, and the Australian Capital Territory.[2]  Most Australian citizens are still of British or Irish decent, but immigration has been a key to Australia's development since the beginning of the European settlement in 1788.  English is the dominant language and is the language of business and government. Between 1945 and 2000, Australia’s organized and well-planned immigration policy enabled 5.9 million immigrants to settle in Australia.  Currently, two out of every seven Australian is foreign born, and the country’s literacy level is 85%.[3]

 

            Australia’s service industry accounts for 70% of the nation’s GDP, but its mining and agricultural sectors account for more than 50% of goods and service exports.[4]  In contrast, the manufacturing industry accounts only for 11% of Australia’s GDP.[5]  Economically, Australia holds a comparative advantage to other countries due to its abundant natural resources and low human population.

            Main Australian exports are coal, gold, iron ore, crude oil and petroleum products, wheat, and aluminum.[6]  The country’s major markets are Japan, U.S., China, New Zealand, and South Korea.[7]  Australia’s main imports are passenger motor vehicles, computers, crude oil and petroleum products, aircraft and parts, and medicaments from the US, Japan, China, Germany, U.K., New Zealand, Taiwan, and Singapore.[8]

            Australia and the US entered into a Free Trade Agreement in May of 2004 that went into effect on January 1, 2005.[9]  This agreement helped eliminate more than 99% of tariffs on manufactured goods, and opened services and agricultural markets between the two countries.[10] Australia also has free trade agreements with New Zealand, Singapore, and Thailand, and is exploring possible FTAs with the United Arab Emirates, ASEAN, Malaysia, and China.[11]

             Australia’s transportation and telecommunication systems are excellent.  There are over 10.8 million main telephone lines and 14.3 million mobile phones in use in the country.[12]  There are roughly 20 million Australians. Australia has over 44,000 km of railways, over 350,000 km of paved highways, 444 airports, 2000 km of waterways,[13] and 13 ports and harbors.[14]  The country is involved in the United Nations, the South Pacific Commission, the Commonwealth Regional Heads of Government, the Pacific Islands Forum, the Cairns Group, APEC, and the ASEAN Regional Forum.[15]

           Long-term concerns for Australia include pollution,[16] management and conservation of coastal areas,[17] Tasmania’s supply of opium,[18] and territorial disputes over the Timor Gap, Cartier and Ashmore Islands, and Antarctica.[19]