Trade and Globalisation - L1 History of Trade

Question 1

Define Exports

Answer 1

Transactions between economic agents in Australia and the rest of the world, in the process of purchasing goods and services that are produced in Australia.

Question 2

Define Imports

Answer 2

Transactions between economic agents in Australia and the rest of the world in the process of purchasing goods and services that are produced by another nation overseas.

Question 3

Describe two examples of Pre-Federation Trade

Answer 3

1700-1907: Makassar fishermen traded with Aboriginal people for trepang (sea cucumber) which they boiled down, dried on their boats and traded with China where it is still used for food and medicine.

Indigenous Australians also conducted trade within Australia well before 1770 via routes that criss-crossed the country. At these locations, goods, objects or Dreaming songs were also exchanged.

Whaling commenced in Australia in 1791. The export of whale by-products such as whale oil became one of Australia’s first primary industries.

The first Marino sheep was introduced to Australia in 1797. The first Australian produced fleece was sold in England in 1807 and by the late eighteenth century, wool had become Australia’s major export.

By the 1850s, Australia was producing 40% of the world’s gold.

Question 4

In Colonial Times, who was Australia’s most prominent trading partner and what percentage of Australia’s imports and exports did it constitute?

Answer 4

The United Kingdom with 70% of Australia’s imports and 80% of Australia’s exports.

Question 5

Prior to 1901, what was one of the main arguments in favor of Australian Federation?

Answer 5

The elimination of customs duties (or tariffs) being applied on goods traded between the six Australian colonies.

Question 6

Define Globalisation

Answer 6

Globalisation refers to an expansion of business operations across international borders as a result of a removal of economic barriers and advances in global technology.

Question 7

Describe one economic barrier to trade.

Answer 7

Tariffs are taxes placed on imported goods by the government to ensure that the locally produced option is more attractive to the consumer.

Question 8

What are the driving factors behind Globalisation?

Answer 8

Rapid advances in technology
The internet makes exchanges of information between countries easier, as well as providing greater potential for global customers.

Relaxation of laws regarding foreign investment in many countries
E.g. German-owned supermarket Aldi has nearly 500 stores in Australia and many foreign banks have invested in Australia as well (HSBC and Citibank).

A reduction in trade barriers
Through trade agreements between countries, the reduction of trade barriers makes the exchange of goods and services between countries easier