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In this paper, the theory of globalization in relation to Australia will be analyzed. The numerous effects of globalization on the economy and the relations between Australia and other countries will be scrutinized and criticized from different perspectives. This will be done on the basis of many publications, both books and articles. The end result will be a tentative and objective view on the effect which globalization has on Australia.

Globalization is not a new issue. Nevertheless, let us refer to the essence of the term. Globalisation is the increasing pecuniary interdependence of states. This phenomenon is reflected in cumulative movement of investments, technologies, trade, labour and finance among countries. Globalization enables the traffic of these five elements. Australia has indulged in trade, stock, fiscal flows, technology transmissions and the relocation of labor since its establishment as a country. What has changed is the proportions, course and effect of these transmissions, particularly, since 1970. There are numerous factors that have assisted this revolution.

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The appearance of new marketplaces as well as the growth of capital markets and foreign markets are connected with the same processes worldwide. These markets function continually and have transactions to any country on the planet. Monetary deregulation and the fluctuation of the Australian dollar ever since 1983 deepened the effect of globalization on the Australian economy.

Innovative machinery and the gears of globalization – the Internet, electronic mail, cellphones, and mass media systems have all hastened the progression of globalization. They have augmented the amount of information and the rapidity of its provision. Australian customers can buy goods in all countries of the world, transfer financial resources between accounts or buy stocks in any branch of industry. Australian companies can advertise their products at a fraction of the price. The enterprises can compare their offers with those of rivals. Thus, businesses are able to see their place in a world market of a certain industrial branch.

The involvement of international organizations promotes globalization. As an example, we can mention the World Trade Organization and  International Monetary Fund with its limitations and regulations it can execute on countries that need help. Often, transnational companies have more monetary control than countries. Fiscal traders and hedge funds are capable of controlling monetary movements and consequently exchange rates, rendering countries stranded. This leads to the situation when traditional economic strategy tools become ineffective.

New guidelines and limitations, multifaceted arrangements on trade, as well as amenities and intellectual property rights, supported by solid implementation plans, decrease the capability of national administrations to develop their own economic programs (Bryan, 1999).

Trading strategies, adopted by Australia since the mid-eighties, have been created to introduce national businesses to the worldwide market. A major focus of operational improvement was to subject the private subdivision in Australia to additional rivalry from both national and transnational companies. Australia has conventionally had great rates, since the 1960’s, in branches such as fabrics, apparel and footwear and cars. Many businesses that succeeded throughout the 1970’s - 1980’s, later were affected by job losses and could not compete in export markets. The influence of globalization has also marked the need of Australia for some professions. There has been substantial development in the industrial and service spheres, while progress in the agricultural sector was restricted. In its turn, this mirrors a mixture of modifications which took place in world demand (Gup, 2005).

The extent of globalization, particularly since 1991, has presented many new initiatives and regulations to the financial institutions which control a country's exchange rate. This does not just concern Australia, but as we experienced in the latter half of the 1990s, numerous countries of the world (Boulle, 2009). The chief drive for foreign exchange is global financial fransfers. Monetary movements use numerous methods. The most rising expanse has involved interest rate, coinage, equities and product derivatives. Interest rates consist of roughly ninety eight percent of the total value of derivatives dealt (Australian Bureau of Statistics, 2000).

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More than fifty percent of the everyday foreign exchange turnover against the Australian dollar encompasses switches and choices. Temporary slowing of transfers always augments exchange rate unpredictability. The fluctuations of the Australian dollar rate in February 2001 proved this. The declaration of a 0.5% interest rate, lowered by the US Federal Reserve, resulted in a drop in the value of the Australian dollar by almost two percent in 24 hours. Usually, a fall in interest rates augmented the Australian dollar, but foreign exchange dealers supposed that the decrease in interest rates would surge profits in the United States, so it would raise the United States dollar. In the next 48 hours, the Australian dollar increased by about three percent. This time dealers contended that the 0.5 fall might not be adequate to stop downturn in the United States economy. These doubts and conjectures have augmented the instability in the rates. Moreover, additional guesses about possible ways to obtain proceeds were raised. In general, there was dire need for proper forecasting such ebbs and flows (Reserve Bank of Australia, 2000).

It has been stressed that the cumulative part of chartist behavior and marketplace subtleties, for example, drift following or impetus trading, are able to determine exchange rates. This relates to dealers who study fluctuations, charts of preceding exchange rates and financial statistics to forecast what will occur to exchange rates in prospect. This is likely to lead to a 'herd' attitude of ‘shadow the leader' and small dependence on the financial basis, which was established in previous months (Stokes, 2000).

Despite recurrent allusion to Australia’s economy as an ‘ancient’ one, there are substantial facts which prove Australia’s rising reception of machinery, globalized information systems and trade. There is augmented usage of the Internet at home and in the office. According to the data, obtained in 2000, nearly thirty percent of Australian citizens used the Internet in the places they lived. About twenty five percent accessed the global network from the office. Approximately twenty four percent used the Internet in locations other than the house or place of work (Suryadinata, 2000). In distinction, the rates for the corresponding period in 1999 were twenty one percent for home use, twenty one percent for the place of work and twenty five percent for the third category – other sites (Macfarlane, 2000). The increase in home Internet usage can be explained by the upsurge in the number of houses with Internet facilities. By October 2001, 2.5 million (thirty seven percent) Australian families had home Internet access, which was more than 1.6 million (26 percent) in October 1999. The prospects were that every second house would have home Internet facility before the end of 2002 (Australian Bureau of Statistics, 2000).

The global crusade of labour has been rising ever since the 1970s. Approximately 2.4% of the world populace live outside their country of birth and 1.6% of the world’s staff work in states other than those of their ethnic groups (Moran, 2005). This tendency rised with the Internet usage. The global network opens the entrance for accomplished persons to apply for posts in nearly any republic of the world. Australian institute educators often get employments in locations such as Saudi Arabia, England, Indonesia, England, China Canada and the United States of America. Often teachers receive a salary, which is more than twice higher than that which they obtain in their native country. Experts and experienced workers are ‘stolen’ from Australia by means of huge incomes which they can earn in a foreign state, particularly due to the present low rate of the Australian dollar. This brain drain will hasten as the international economy gets stronger. The second constituent of globalization encompasses the hidden influence of variations in the worldwide marketplace on national economies. This reflects the latent admission of transnational competitors into the marketplaces of certain industries (Grittins, 2001).

Globalization has played an important role in the Australian economy and business relations. The various effects of globalization are real and of long duration. The establishment of new enterprises which sell goods to other countries worldwide reveals strong points of Australian economy. Business success exemplifies the fact that Australia is able to compete in the global market. This sufficiently opens up Australia both locally and to the entire world. Innovative equipment and modern information systems have helped in hastening the process of globalization which, in its turn, has made a good effect on the market of Australia. The involvement of influential international organizations and various restrictions have also played a significant role in globalization and hence, have promoted the improvement of business dealings of Australia, both on the national and international levels.

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