Chapter 1 Improving Australia’s Trade and Investment Relations with the
Countries of Asia, the Americas and the Pacific.
1.1
The Trade Sub-Committee commenced this inquiry in July 2008. It quickly
became apparent that there were too many countries and too wide a disparity in
development levels, to adequately cover all of them at once. Consequently, the
Sub-Committee decided to divide the inquiry into two parts – the first to cover
the APEC economies and the second to include the remaining countries.
1.2
Economic conditions facing all of these countries (and also Australia)
have undergone a drastic change since the commencement of the inquiry. When it
began, Australia’s economy was very strong and a number of our trading
partners, notably China, were growing very rapidly.
1.3
The onset of the financial crisis has changed the picture dramatically.
Trade levels are slackening, investment is shrinking and the future growth of
many of the world’s important economies is in doubt.
1.4
As global unemployment levels rise the predictable threat of increasing
trade protectionism has begun to make its appearance. The lessons learnt from
the disastrous “beggar my neighbour” policies in the 1930s have, it seems, been
forgotten in some quarters. Similarly, some industries are already seeking
restoration of protection and ignoring the benefits accrued by Australia from
its large-scale reductions in protection in the 1970s, 80s and 90s, and the
concurrent restructuring of the economy.