The value of Australia's trade is about 20% of its GDP, which ranks us 53rd out of 60 regions tracked by the IMD World Competitiveness Yearbook.
CEDA's latest research project, Competing from Australia, is exploring what Australian firms need to do to compete on the international stage in the next decade and beyond.
The project's first reference group convened in August 2005 and the final report will be released on 9 July 2007.
Project summary
Australia’s economy has thrived over the past decade on a combination of strong consumer demand and investment directed to the internal economy, and rising overseas demand for commodities. But beyond the commodities-producing sector, Australia’s trade and investment performance has been less than impressive. And several observations raise questions about Australia’s capacity to trade and invest vigorously in the 21st-century global economy.
- New economic thinking suggests that distance is a powerful impediment to economic development, and to the development of knowledge-based economies in particular – and Australia is the most isolated large economy in the world.
- Firms' ability to learn from suppliers and from customers, and their ability to draw on a large pool of talented and experienced experts, seem more important than ever before – and Australia is a small country far away from the largest pools of customers and suppliers.
- Global supply chains, often centred on large multinational “platform” companies, play an increasingly important role in world trade and investment – and Australia lacks “platform companies.
- The ability to create technological and process innovation is increasingly seen as central to advanced economies’ growth capacity – and Australia performs poorly on a number of innovation indicators.
How substantial are these challenges? And how can Australia overcome them?
For a more detailed description of these issues, see the essay published in Australian Chief Executive magazine for December 2005, "The World Is Not Flat".
