Australia and China – Economics

Australia and China Similarities and Differences Australian links with China extend well beyond the last 40 years at an official and non-official level. Their economic relationship has grown rapidly in recent times, especially the trade relationship. From being distant partners, the trade relationship is one of the key strands linking the two countries. Economic Growth and Quality of life Australia’s economic outlook is deteriorating. The commodity boom, predicted to go on forever, is showing signs of slowing. Meanwhile, China’s factory demand figures are a good sign for its economy.

Australia has been enjoying strong, consistent economic growth, low unemployment and increasing living standards. It benefited from the increasing wealth of emerging nations, especially China and India, and demand for commodities. Meanwhile, government spending, lower interest rates and a credit-fuelled investment boom in China helped Australia avoid the worst of the economic slowdown in developed markets. But now economic growth in China, India and other emerging markets is slowing. Australia’s political and economic advantages are complemented by its welcoming attitude and excellent quality of life.

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With Australia’s GAP per person being $61,000 which makes the Australian people mom of the wealthiest people in the world. Due to the fact that it is such a small country. Individuals in Australia enjoy living standards that are on average, 10 times higher than that of China where the GAP per person is around $6,000. Even with this disparity, standard of living in China has risen due to economic growth. Increased employment has resulted in rising incomes where consumers are within the grasp of most in China. Australia unemployment and Employment: In 2011, Australia had an unemployment rate of 5. %- which was similar to that of some economies such as Japan. In contrast, China had a relatively lower employment rate of 4. 1%. Currently the January 2013 unemployment rate for Australia was 5. 4% and for China it was 4. 2%. Employment patterns in Australia are similar to most advanced economies with the majority of people employed in service industries such as retail, trade, real estate and business services/ management. Primary and secondary industries continue to provide employment especially in construction and manufacturing; however agricultural employment is less popular than in previous decades.

China is facing an upward trend in unemployment in China and is in stark contrast to Australia That is experiencing a declining employment rate. Between, 2011 and 2012, Australia’s unemployment decreased to 625,000. China places great importance on employment, however with an increasing number of people entering the labor market, there is very stiff competition for places and with the low levels of education, many are being left unemployed. Distribution to Income: Income being distributed through an economy is incredibly important and must be dealt with very careful transactions.

Even if the GAP of a country is high, if the income is only distributed to a small proportion of the Population then many people will buffer from a low standard of living, which is not the case in Australia. As a result, Australia has a relatively equal distribution of income (measured by the Gin index) 0 and the Lorenz curve. Australia has adopted a progressive tax system and hence takes money from higher income tax Brackets and redistributes them to the lower tax brackets through social welfare payments.

Australia is experiencing an increase in income distribution inequality as in 1998, the gin co- Deficient was 30. 3 and now has increased by 9. 2% to 33. 5. In comparison, China is a relatively unequal society, in reticular due to the large divisions Between poorer rural areas (growing on Agriculture) and wealthier urban areas. According to the Chinese Academy of Social Science, the top 20% income is 18 times that of the lower 10%- who in fact belong to a rural background.

With this, the top 10% of tax brackets constitute 45% of total wealth among all residents in China, whilst the bottom 10% only contributed 1. 4% of the total income in the country. – Reflected in Gin coefficient Score of 43. 9. Environmental Sustainability Environmental sustainability means to control the use of resources so as to ensure he availability of resources to the next generations and increase their quality of life. Australia has undertaken reasonable attempts to ensure sustainability through the implementation of policy like ecological sustainable development.

The Australian preservation of the environment is significantly more efficient than most industrialized economies- both past and present. Economies like China are placing great stress on resources through rapid industrialization and a booming population. Australia was ranked 13th on the economic sustainability index whilst China was placed 33rd out of 146 ranked nations. China hasn’t actually done anything to be environmentally stable. Both nations struggle to be environmentally stable due to both economies especially Australia due to be largely reliable on natural resources for exporting.

The role of the Government in healthcare, education and social welfare Australia has a well- established health care system known as Medicare that is significantly different Tot the health systems in China, where resources and infrastructure are underdeveloped. Australia’s public spending on health care (5. 6%) is very high, in comparison to China. (2. 3%) Australia has a strong belief in the revision of health care-which is reflected through its regular Spending and accessibility all over the country.

The Australian government also works to combat lifestyle diseases such as obesity and Cardiovascular diseases through strong advertising. As a result through education, the smoking rate in Australia was 22% compared with 50% in China. In China, health and education services are under – funded and are not accessible by the rural communities. Australia enjoys a well- developed and highly accessible education and health system that is constantly monitored by the government. Australia also enjoys a highly affluent lifestyle where consumer products are commonly enjoyed within most households.

The Australian government provides the most educational services, with now a vast majority of universities being public. Australia’s social welfare program through Centerline provides a level to assistance tar greater Ottoman that tottered in China Boot countries provides payments of unemployment benefits, aged and disability pensions and maternity leave- however the amount paid in China does not allow those to uphold their quality of Life. This is different in Australia as people can maintain a reasonable quality of life.