Australia’s Place in the Global Economy

Australia’s trade and financial flows
Value, composition and direction of Australia’s trade and financial flows

trends in Australia’s trade patterntrends in financial flows – debt and equity

Australia’s Balance of Payments
structure
Current Account
Debits and Credits
net goodsnet servicesbalance on goods and servicesnet primary incomenet secondary income
balance on current account

Capital and Financial Account
Capital account
Financial account
Direct investmentportfolio investmentfinancial derivativesreserve assetsother investment

links between key Balance of Payments categoriestrends in the size and composition of Australia’s Balance of Payments
international competitiveness, terms of trade, international borrowing, foreign
investment
effects of these trends on Australia’s Balance of Payments

Exchange rates
measurement of relative exchange rates
to other individual currencies
Trade Weighted Index
factors affecting the demand for and supply of Australian dollarschanges in exchange rates – appreciation/depreciationdetermination of exchange rates including fixed, flexible and managed ratesthe influence of the Reserve Bank of Australia on exchange ratesthe effects of fluctuations in exchange rates on the Australian economy

Free trade and protection
Australia’s policies regarding free trade and protectionAustralia’s multilateral and bilateral free trade agreements – (overview of two examples of each type of agreement)the implications of Australia’s policies for individuals, firms and governmentsimplications for Australia of protectionist policies of other countries and trading blocs.