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Module - International Economics
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Table of contents
Title Page No.
1.0 Introduction 03
2.0 Australian Balance of Payments - An Overview 04
2.1 Changes in the proportions of Current Account Deficit 04
2.2 Changes in the proportions of Net Foreign Debts 05
3.0 Macroeconomic policy setting in Australia 06
4.0 Microeconomic policy setting in Australia 08
5.0 Recommendations 11
6.0 Conclusions 13
7.0 Bibliography 14
Annexure - A 15
Annexure - B 16
Globalization has had a greater integration between different countries and its increasing impact on all aspects of life and economic activities. As Australia's economy becomes increasingly tied to the global economy, even minor changes in the global economy will have a significant impact on Australian trade, financial flows, and fluctuations in interest rates, exchange rates, government policies, causing changes in its current account and net foreign debt.
Being thirteenth largest economy in the world, over the past thirty years, the Australian economy has experienced positive reforms that have stimulated the economy and raised the standard of living. Australia is currently riding the boom product, especially the huge contracts signed with China to fuel its economy the fastest growing player in the world with raw materials and energy it so desperately needs. Although during the financial crisis, Australia has continued to grow driven by its commodity exports, and is expected that growth will continue for at least five years.
The purpose of this essay is to analyze the concept of balance of payment in association with the macro and micro economic policy settings in Australia. I would like to bring in to the...