Australia: Globalisation of international trade – Where to now?

For so many years the main challenge of globalisation lay in getting market access and building global supply chains. Now, the challenge may just be maintaining the status quo.

We are now seeing a dangerous push to abandon or even reverse the process of globalisation and to punish the political leaders that promote it.

Protectionism has been on the rise since the GFC but the UK Brexit vote was this year's big wake-up call for developed economies and was an indicator of the shockwave that was about to be unleashed in the US.

The US electorate's decision is a clear signal against a whole bunch of things that are wrapped up in a new term of complaint: 'Free Trade'.

The President-elect has made it clear that he thinks American negotiators have done poorly in global trade negotiations. Two of his prominent agenda items are stopping the Trans-Pacific Partnership (TPP) coming into force and the repeal of the North America Free Trade Agreement (NAFTA).

The politics against free trade confounds trade and investment with the consequences of technology and blames it for any rises in inequality in developed economies.

It offers a simple narrative that free trade has been a false promise. This is also leading to a widespread disillusion with political leaders around the world.

This changing shift in the political narrative challenges what we have known as the citizens' bargain. A bargain where citizens accepted the promise made by political and business leaders on the benefits of opening up of economies and acquiesced in domestic reforms in support thereof - believing they would benefit.

So, we are entering an extremely uncertain period. This stage of globalisation is under serious threat. Under protectionist agendas it could become more not less difficult, for foreign companies to invest in foreign property or businesses, or to establish new businesses within foreign borders.

It actually runs the risk of derailing 'behind the border' reforms necessary to support economic growth.

The need remains for the process of globalisation to continue, perhaps, reconsidered.

Let's be clear: Globalisation has opened the world up and Australia, like the rest of the world, has benefitted greatly from this economic, political and social model.

Access to global markets has helped hundreds of millions of people out of poverty within a short time and sustained economic growth. According to the World Bank in 1981 some 43 per cent of the world's population lived in absolute poverty. By 2013 that figure was below 11% and current projections estimate that by 2030 the global poverty figure could be as low as five per cent.

A commitment to globalism underpinned the creation of the World Trade Organisation, and open regionalism underpinned the creation of APEC (Asia-Pacific Economic Cooperation).

Branko Milanovic, Lead Economist at The World Bank, wrote earlier this year that the mid-1980s to today is "the period of the greatest reshuffle of personal incomes since the Industrial Revolution." He called the Asian middle class the "winners" of globalisation and Australia has benefited greatly from this 'win'.

Australia's international economic diplomacy was based on globalism, open economies and open regionalism, and these need to be reaffirmed.

As an island continent, blessed with an abundance of natural resources, Australia is naturally a trading nation. Over the next century it has a vital role in the growth of the Asian middle class and as we move further into this interconnected global society this country's share of export income from services and knowledge will undoubtedly rise.

Intellectual property and market value are being added at every level of the integrated production process.

Supply chains are now more accurately described as value chains.

For example, is Apple an American company with a Chinese labour force? Or, is it a Chinese product with American know-how and marketing?

Australian companies provide components to Apple, not by exporting them to America, but by exporting them to China.

Local Chinese, Australian and American tech enthusiasts sell Apple products and provide after sales service on the ground. And Chinese, Australia and American consumers – and consumers right around the world - queue up to buy iPhone 7.

So in China, Australia and America, globalisation looks and feels both global and local.

This new stage of globalisation -- or global integration -- is a great opportunity but also offers major new challenges.

It is going to require a superior level of advocacy and decision making from leaders at all levels.

Within the global marketplace a failure in any one place can become a widespread disaster very quickly.

The financial policies, or crises, of one major nation can drive global tremors for everyone.

This is a world of extraordinary interdependence which can prove fragile in a crisis. The deeper challenge of globalisation is that, while it is ubiquitous, its benefits have not been equally shared.

The votes in the UK and US can be seen as a protest against globalisation and an admission that the voters want to see more benefits of their vibrant knowledge economies at home. It is difficult political challenge. But our leaders need to remember if we turn our backs on globalisation the great advances to lift nations and their citizenry out of poverty will stall and even reverse and that risks an altogether different world for our children.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Chambers Asia Pacific Awards 2016 Winner – Australia
Client Service Award
Employer of Choice for Gender Equality (WGEA)

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
 
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions