Australian Trade in India and China Essay Example | Topics and Well Written Essays - 1000 words

Australian Trade in India and China - Essay Example The rapidly expanding Chinese economy has steadily resulted in solid infrastructural development. This in turn has allowed for the increased prosperity of many within mainland China. With rising personal disposable incomes, comes increased consumption demand and thus growing domestic expenditure. Chinese imports are gradually increasing, thus presenting a myriad of opportunities for suppliers of raw materials and products in various stages of production. Political relations between China and Australia have significantly improved in recent years. An example of the bilateral co-operation includes the Sino-Australian parliamentary exchange conference held in May 2007. The Chinese economy - a renowned net exporter - boasted a current account surplus of $359 billion in 2007 and a net figure of Foreign Direct Investment of $83 billion. All in all, the Chinese foreign reserves stand at $1.5 trillion for the year ending 2007. (Sino-Australian parliamentary exchange conference. Embassy of the People's Republic of China in Australia) This bodes exceptionally well for investment opportunity. With such rapid development and a large and economically powerful buying market, the Chinese sector presents immense profitable opportunity potential to Australian investors. The Chinese housing market; share markets and general government reluctance to allow inflationary pressures to impact on the economy have resulted in an investor safe-haven in the Chinese domestic market. Few economies can lay claim to such robust growth rates as the Chinese economy. With rising prices, spurned by the inflationary pressures of petroleum supplies; food prices and general dollar w eakness, the Chinese government is intent on protecting the domestic economy from global pressures. Investments in Chinese infrastructure allow for significant benefits to International Donor Financiers. The following statistical data was compiled by the World Bank regarding China 2003 2004 2005 2006 2007 A. Real Expenditure Growth 1. GDP at market prices 10.0 10.1 10.2 10.7 9.6 2. Private consumption 6.6 7.0 7.0 9.0 8.5 3. Government consumption 6.4 7.2 9.0 8.8 8.0 4. Fixed investment 17.0 11.6 8.8 8.9 8.2 5. Exports, GNFS 26.8 28.4 24.3 23.6 19.1 6. Imports, GNFS 24.8 22.5 12.0 19.5 18.8 B. Contribution to GDP Growth 1. Private consumption 2.9 3.0 2.9 3.6 3.4 2. Government consumption 1.0 1.1 1.4 1.3 1.2 3. Fixed investment 6.1 4.4 3.4 3.4 3.1 4. Net exports 1.3 2.8 5.3 3.8 2.5 C. Price Deflators 1. GDP at market prices 2.6 6.9 2.1 3.1 5.6 2. Private consumption 1.4 4.9 2.9 4.5 6.8 3. Exports, GNFS 4.7 5.3 1.7 3.7 0.9 4. Imports, GNFS 9.7 10.3 4.9 7.2 0.4 D. Share of GDP 1. Private consumption 41.8 39.9 39.1 39.0 39.0 2. Government consumption 15.2 14.5 14.6 14.7 14.6 3. Fixed investment 39.4 40.7 41.3 41.6 41.4 4. Change in stocks 1.8 2.5 0.0 -1.1 -1.2 5. Total investment 41.2 43.3 41.2 40.5 40.1 6. Exports, GNFS 29.6 34.0 38.1 42.8 44.4 7. Imports, GNFS 27.4 31.4 32.8 36.8 38.0 E. Memo 1. Nominal GDP (USD billions) 1640.4 1930.9 2171.7 2477.4 2867.6 2. Population (millions) 1300.0 1308.0 1315.8 1324.1 1332.4 3. GDP per capita, current USD 1261.8 1476.2 1650.4 1871.0 2152.2 4. Real per capita GDP growth 9.3 9.4 9.5 10.0 8.9 5. USD Fx rate 8.3 8.3 8.2 8.0 7.6 6. Current account balance (% GDP) 2.8 3.6 7.4 9.3 9.2 7. General government bal. (% GDP) -2.5 -1.5 -1.7 -0.5 -0.8 India presents with multiple challenges notably generally