Free Trade Agreement Between China and Australia - 683 Words

Free Trade Agreement between Australia and China China, Australia’s second larges export destination, is a growing economy. The labours in china are really cheap, so a lot of companies set up new manufactures in China and close down manufactures in other countries. A Chinese is satisfied getting 800 yean month, three meals a day and a bed to sleep. There are also people, who are willing to work for even lower labours. So if Australia would have a FTA with china it could profit from the fast growth and development of China. China’s growing manufacturing industry needs large volumes of raw materials, which could be supplied by Australia. â€Å"Most Farmers and key agricultural exporters –wool, beef, dairy and grains- have set up their sights†¦show more content†¦The FTA will be a model of how to countries, so different in many respects, can share an economic future.†(the Age,April 20,2005 ) But there are also disadvantages. While Australia’s wool industry and other sections of Australia’s economy would profit from the FTA, there are also losers. The car, clothing and vegetable industry could be destroyed by the Chinese exports, because the Chinese producers can offer their products much cheaper. â€Å"But they don’t face the same quality assurance condition and have access to cheap labour.†(the Age,April 20, 2005) China could swamp Australia with below-cost imports. The Australian producers aren’t competitive, so they will loose market shares. Before the negotiations begin, Australia has to recognize China as a market economy. â€Å"But the prices for Chinese products appear to be set by authorities instead of markets†(the Age, December 6,2004) and the products are often dumped, so a recognition would undermine Australia’s anti-dumping powers. Chinas rules of law in commerce are still underdeveloped and the economy isnâ⠂¬â„¢t fully transparent. If Australia recognises china as a market economy the minister isn’t required to resort surrogacy, where unreliable or no pricing information is available. So there would be Legislative or administrative changes needed to undertake action against predatory priced products dumped on the Australian market. Besides China’s benefits of this deal will be grater than the Australian ones, because China isShow MoreRelatedImpact Of Globalization On The Global Economy1452 Words   |  6 Pagesexpand out exchanges and social trade. This results in a trade of different perspectives, knowledge, items and culture. Many goods and services have increased, because of worldwide trading throughout the past years. Australia is linked into the global economy due to exchanges being made between nations and technology being better than ever, as it is quicker, faster and easier to communicate with potential customers. 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