AUSTRALIA

Alexandra E.  Amber P.  Levente R.  Liu H.  Rubaba A.

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OUTLINE

•1.  An overview of the country: informal and

formal institutions & PEST-analysis
•2. Competitiveness
•3. The role of trade
•4. Foreign Direct Investment in Australia
•5. Why is the country attractive 
•6. Summary

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Australia
• Commonwealth of Australia
• Continent: Oceania
• Population: 26 million
• Capital: Canberra
• Currency: Australian dollar

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An overview of the country
Formal institutions Informal institutions

Political system Culture

Mixed system of government Religion: no official state religion

A two-party system Language: no official language

Economic system Ethics

Mixed economic system Code of conduct

Rule of law: strong legal frameworks Corruption: uncommon

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PEST-ANALYSIS
Politics Sociocultural

Government stability: business-friendly market

Population demographics: smaller than other countries
Taxation policy: 30% - 27,5%
Income distribution: average household gross income is
Foreign trade regulations: strong trade ties
$116,584 
Economics Social mobility: parent’s fortune are an advantage
Business cycle: growth without recession
Lifestyle: lively, hardworking, and outward looking 
GDP 2019 (Current USD): USD1.397 trillion

Real GDP Growth 2020: -4,2% Technological

GDP Per Capita 2019: USD57,060 per capita

Government spending on research: $3,330 million. 
Inflation - interest rates: 0,9% - 0,10%
Government and industry focus on technological effort:
Unemployment: 6,4% technological innovations  5
Australia's GDP, GDP per Capita and real GDP growth rate % 1960-2019

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Data source: World bank
Australia
Business Last
Business
Confidence
10.00 Competitiveness 
Corruption 77.00
Index
Corruption 11.00
Rank
Competitive 78.75
ness Index

Competitive 16.00
ness Rank 18

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Australia, The role of trade

• Australia is 13th biggest

economy 
• 209 Billion USD Import
• 284 Billlion USD Export
• 75! Billion USD Trade Surplus

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Australia and its key export products

• Iron ore – Export value of 67 Billion USD –

about 53% share of the world economy 
• Coal ( Briquettes) -  Export value of 51 Billion –
about 27% share of the wolrd economy
• Petroleum gas - Export value of 34 Billion –
about  30% share of the wolrd economy
• Gold - - Export value of 25 Billion – about  9.5%
share of the wolrd economy
• These 4 commodities make up 63% of the
australian exports. 

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Australia's crucial export destinations

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Internationally recognized aussie brands

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The biggest exporters,
the role of FDI MNE
subsidaries in export 

• Foriegn owned enterprises - more

export intensive than the
domestic companies, so the state
subsidaries for export are usually
channeled accrodingnly
• The australian goverment
encourages export with assistance
(grants, financing, advice and data
providement etc) 

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 • Australian Small and medium enterprises important part of
the domestic economy
• Irrelevant internationally – account >14% of total export by
value
SMEs role in • Obstacles for joining the global market for SMEs:
trade • Lack of information
• Geograpy
• High transport cost

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 FDI net inflow in billion USD

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Source: World Bank
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MNEs

BP

Exxonmobil

Bupa

HealthSCOPE Benefits

Alibaba
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Why invest in Australia 

 Strong growth

 Low public debt

 An attractive tourism destination

 Stable and judicially reassuring business environment

 Large reserves of natural resources

 Good quality business climate and infrastructure

 Strategic location close to Asia

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 FDI net outflow in billion USD

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Source: World Bank
 Where does Australia invest?​
Rank in % of % change 2018 to 5-year
Economy 2017 2018 2019 trend
2019 total 2019 % growth
1 United States 683.4 729.0 837.4 28.4 14.9 5.7
2 United Kingdom 347.9 406.3 507.4 17.2 24.9 7.8
3 Japan 125.0 113.3 139.6 4.7 23.1 12.0
4 New Zealand 103.7 96.5 130.5 4.4 35.2 5.3
5 Germany 74.1 73.4 97.1 3.3 32.2 6.9
6 China 77.3 79.1 85.3 2.9 7.7 7.7
7 Singapore 59.9 73.0 84.1 2.8 15.1 10.6
8 Canada 49.9 79.8 83.4 2.8 4.6 16.7
9 Cayman Islands 65.6 79.5 82.4 2.8 3.7 16.3
Hong Kong (SAR of
10 49.3 52.7 63.4 2.1 20.4 5.2
China)

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Source: https://www.dfat.gov.au/  
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 • Natural resource 
• More port 
Australia's • Agriculture 

Advantages • Free Trade Agreement

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REFERENCES

•World Bank Open Data: https://data.worldbank.org/https://tradingeconomics.com/australia/interest-rate

•Australian Bureau of Statistics:  https://www.abs.gov.au
•Greber, J. Australia just above OECD 'Great Gatsby curve' of social mobility . Retrieved from
https://www.afr.com/policy/economy/australia-defies-great-gatsby-curve-of-social-mobility-oecd-says-20180615-h11fzo
•Parliament Education Office: https://peo.gov.au/
•Tricaud, M. International Business Guides: Australia. Retrieved from HSBC Australia: 
https://www.business.hsbc.com/business-guides/australia
•https://www.imrg.org/australia-politics/
•https://en.wikipedia.org/wiki/Australia
•https://mccrindle.com.au/insights/blog/australias-income-and-wealth-distribution/
•https://mtcorp.com.au/business-ethics-in-australia-what-you-need-to-consider/
•https://www.focus-economics.com/country-indicator/australia/inflation
•https://www.dfat.gov.au/ 

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REFERENCES

•OEC.world, Australian yearly Exports: https://oec.world/en/profile/country/aus?yearSelector1=exportGrowthYear25

•Commodity.com, Top australian exports, https://commodity.com/data/australia/ 
•Worldstopexports.com, Australia: http://www.worldstopexports.com/australias-top-10-major-export-companies/
•Australian FDI: https://www.pc.gov.au/research/completed/foreign-investment/foreign-investment.pdf
•Export intensity data: http://www.oecd.org/investment/Australia-trade-investment-statistical-country-note.pdf
•Australian gov incentives: 
https://www.austrade.gov.au/International/Invest/Guide-to-investing/Australian-Government-support-programs/Assistan
ce-exporting-from-Australia
•SME: 
https://www.dfat.gov.au/trade/agreements/not-yet-in-force/tpp/Pages/outcomes-small-and-medium-sized-enterprises
•SME and exports: TPR_2018_Export_Council_of_Australia.pdf

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THANK YOU FOR
YOUR
ATTENTION

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