Term Paper on "Australia Imports the Australian Import Economy"

Term Paper 9 pages (2631 words) Sources: 10

[EXCERPT] . . . .

Australia Imports

The Australian Import Economy and the Environmental Threat of Grounding

The intercession of information technology proliferation (i.e. internet, cellular phones, handheld mobile communication devices) with the intensification of globalization has had the impact of transforming the way in which states relate to one another. The combination of these factors has functioned to erase many of the theoretical borders that have obstructed economic activities between nations of different cultural and ethical dispositions. Australia's proximity to Asia renders it a regular and favored trade partner to many nations on the so-called Pacific Rim. Australia's generally respected geopolitical stature makes it an immediate point of contact in the region for many smaller Asian nations and principalities. Though this brings with it certain economic advantages for Australia within the context of its region, it also foists considerable responsibility on Australia to function in a positive diplomatic capacity, to protect its own security interests and to remain tuned into the inherent dangers of an import-based economy. This latter issue is the utmost of our concerns in the present discussion, which denotes that though there are clear economic imperatives for local businesses to import resources, commodities, products and services as a result of the opening pathways created by globalization, there are also clear points of peril of which domestic business leaders must be keenly aware. As noted by events impacting the Great Barrier Reef in early April of 2010, where a coal transporting tanker originating in China ran aground to terrible economic and ecological effect, those making the decision to import must balance the imperatives of globalization with its risks.

Background:

The discussion on import opportunities for Australian businesses begins with Australia's push toward greater leadership in the process of globalization. In 1989, acknowledging the changing tide of the world economy, the various countries which make up what is today characterized as the Pacific Rim, or Asia-Pacific, gathered at a summit in Canberra, Australia to discuss the implications of a joint regional agreement designed to reduce trade barriers amongst the countries aligned toward shared goals on the borders of the Pacific Ocean. (Fleischer, 1) This would include many of the countries of Southeast Asia, Asia, the Australasia region and North America. These nations, of a wide range of differing cultural, political and economic dispositions, would establish through the Asian Pacific Economic Cooperation an agreement that would alter global politics; establishing a grounds for excluding so-called rogue nations from the benefits of economic interaction, for cultivating the increasing interdependency of diplomatic nations by reducing trade barriers, and for establishing a tool helping to bring industrializing progress to developing nations.

However, APEC's importance as an economic force extends well beyond the ability for the nations trading across the world's largest water-mass to influence one another in policy and practice. In the years that would follow the creation of this economic forum, the principle for free trade would take hold in some manner in every sphere of the inhabited globe. Such channels as APEC would therefore serve as ideal for the graduation toward universalizing standards for the elimination of obstacles to international trade. Unfortunately, even as these obstacles have been removed, additional complications have supplanted them. Chief among these is the broad vulnerability of environmental regulation stimulated by the process of globalization. Where many industrialized nations such as Australia have already established highly refined and clearly enforceable regulatory conditions both in terms of sustainable business practices and public oversight of environmental policy engagement, the creation of new partnerships in the developing sphere has diluted the preeminence of these policies. This has allowed for the types of oversights that caused the grounding of the Shen Neng 1 on April 3, 2010. Irresponsible practices occurring as a result of poor regulatory control on operations from countries such as China denote a clear threat to business leaders in Australia who have come to increasingly rely upon foreign imports to facilitate their operations. This is to indicate that the onus is truly upon Australian authorities and business leaders to improve the environmental implications of import practices which have essentially become economically unavoidable.

Descriptive Analysis:

This dilemma has been illuminated every few years by another catastrophic ship-grounding on one of the world's most densely varied ecosystems. Most recently, Bradsher (2010) reports in a New York Times article, the Shen Neng 1 was as much as 12 miles off course and navigating through environmentally protected waters when it struck the reef. Bradsher indicates that "environmentalists have seized on the Shen Neng 1 -- battered and perched on a shoal in shallow, azure water with a small, inky stain of leaking oil undulating into the water -- as a symbol of what they portray as the exploitation of Australia by foreign powers." (p. 1) This underscores one of the clear consequences of Australia's heightened trade interaction with nations lacking its same regulatory and environmental fortitude.

For all intents and purposes, China is the leading trade partner for Australia today. However, in many ways these economic imperatives are overshadowed by what former Prime Minister Kevin Rudd -- who held office at the time of the Shen Neng grounding -- referred to in the news as a challenge concerning differences in value system. Particularly, recent divides concerning Australia's diplomatic relationship with smaller Asian territories with hostile relations to Chinese occupation, as well as Chinese crackdowns on expressive freedoms which recently nabbed an Australian-born executive, have revealed the truly wide chasm between the nations. Bradsher backs this claim, noting that "the grounding of the Shen Neng 1 also coincides with unhappiness in Australia over the long prison sentences imposed last week by a Chinese court on four managers from Rio Tinto, an Australian mining giant, on bribery charges." (p. 1)

The Bradsher article helps to underscore the complexity of the trade landscape in the Pacific Rim, confounded as it is by the interaction of governments which are in many ways incompatible. Beyond the values to which Rudd refers -- and this is certainly greater than an afterthought -- are the sheer practical limitations in Australia's capacity to regulate the practices of partner nations. Given the variety of reasons claimed for the grounding of the Shen Neng -- including fatigue, inexperience and the use of incorrect navigational charts -- it seems clear that China's absence of operational control over its maritime exporting operations is inconsistent with the approach taken by Australian authorities. For importers domestic to Australia, this carries some serious implications.

Implications to Exports:

Maritime trade is today imperiled by an array of threats which are difficult to predict or control. Among them, international piracy and waterborne terrorism are major concerns. Another area where focus must be applied on an international level is in taking the proper precautions to prevent running aground. Though on one level this should an area of inherent navigational importance, certain natural challenges have made this an area increasingly demanding of more conscientious consideration. An important example is the crucial and unparalleled natural phenomenon of Australia's Great Barrier Reef. A rich ecosystem and a distinguishing feature of Australia's natural landscape, the Barrier Reef is also enormous in scope and poses a difficulty to ocean liners which must pass through the shipping channels of the Coral Sea off the coast of Queensland. As a protected environmental landscape and a denoted World Heritage Site, the Great Barrier Reef is legally protected from invasion and contact with ocean shipping operations. However, no small amount of incidences has been recorded over the course of the century, suggesting that there is yet the need for greater security and cognizance with respect to the invasion of these protected waters, particularly by importing operations which are regulated by foreign authorities rather than by Australian ones.

According to an article by Ottesen (1994), "the operation and navigation of vessels within the GBR region can pose a significant threat to its ecological and economic integrity. Oil released by accident or as part of the operational activities of a vessel is the most publicized threat but others can include physical damage to reefs because of groundings and collisions, anchor damage, the introduction of exotic organisms via the discharge of ballast water and the use of toxic antifouling paints." (Ottesen, 507)

This is an assertion punctuated by April's events involving the Shen Neng 1, which have cast new light on the long-standing need to prevent unauthorized or accidental entry into such waters. The Chinese tanker veered into protected waters without notice and ran aground of the Douglas Shoal, which the article by Gelineau (2010) identifies as the 2nd largest coral key on the reef. The incident would require the ship to be lifted by air after a three day process had pumped out the fuel propelling the ship. (Fraser & Owens, 1) In addition to the cost to shippers and to the broader economy by the damage and delay caused by the disruption to shipping operations, the environmental costs of such incidences are considerable and manifold. In the case of this particular tanker, the… READ MORE

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