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Issue No. 13 - October/November 2003
Promise of the People’s Republic
by Tim Harcourt
Is Australia benefiting from China’s economic resurgence? At first glance, the signs are promising.
On my first visit to the People’s Republic, I seemed to see ‘sprinklings’ of Australia on every part of my journey. For instance, even before I reached the mainland, on a Dragon Air Flight between Hong Kong and Shanghai, the breakfast served included jars of jam made by Beerenberg a small family owned company based in Hahndorf in the Adelaide Hills.
After arriving in Shanghai and catching a taxi, the driver, after finding out that I was Australian, pointed to the Australian—made GPS technology panel which is used to pick up all computer bookings. “This is made in Australia – all taxis in Shanghai have these…” he announced proudly. On the way into bustling downtown Shanghai a Fosters neon sign takes its place proudly in the spectacular Shanghai skyline. At my hotel, an Australian company, Dynalite, produced the lights. Jimmy Du, Dynalite’s Shanghai manager, and sometime resident of Australia later told me that his company provides lighting for most of the hotels in Shanghai and were expanding to Beijing on the back of the 2008 Olympics.
However, these are just anecdotes and observation of Australia’s role in China’s burgeoning economy. What is the overall macro picture?
China is Australia’s fourth largest export market after Japan, USA and Korea. It accounts for 7 per cent of total exports—mainly because of its contribution to global industrial production. According to UBS Warburg, China accounted for 40% of the increase in world output over the past year, which is a contribution equivalent to four times its weight in the global economy and seven times its share of world trade.
China’s significant contribution to global industrial production means it has an insatiable appetite for resource inputs and raw materials. This is good news for a commodity exporter like Australia. Accordingly, in trade terms, r...
