International Trade:
--------------------

Reasons for trade - Limited domestic market
                  - Gain resources, Gain goods
                  - International specialisation
                  - Absolute advantage
                  - Comparative advantage

Composition - Export: - Rural, resources
                      - Manafacturers
                      - Services
            - Import: - Machinery
                      - Transport equipment
                      - Chemicals

Largest     - Export: - Japan
                      - N. Asia
                      - S.E. Asia
            - Import: - USA
                      - Japan
                      - EEC

Trends      - Export: - Increased services -> Tourism
                                           -> Education
                      - Increased E.T.M.
            - Import: - Increased machinery (computers & hardware)
                      - Transport equipment


Increased importance of International Business:
-----------------------------------------------
- From mid 1980's increase in exports and imports, therefore a
  decrease in tariffs', deregulation, microeconomy reforms
- Encouraged by governments, therefore a reduction in unemployment,
  but an increase in St. of h.

Balance of payments:
--------------------
Balance of current account:
---------------------------
Goods &  { (A) Balance of goods services = Exports - Imports
Services { (B) Factor income = Export$ services - Import$ services
         { (C) Net unrequired transfers
   +
Balance on capital account money
----------
$0.00-


Normally Australia has a _defecit_ on it's Current Account
(IE. CAD), caused by: - (i) decreased terms of trade
                            therefore decreased P of rural
                            therefore increased price of
                            imports as decreased price of Exports
                       (ii) decreased international competitiveness
                            therefore increased cash, low productivity,
                            decreased australian dollar
                      (iii) Increased imports therefore fast growth
                            policy
                       (iv) Increased capital inflow / foreign
                            investment

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Current Account:
----------------
Balance on merchandise trade
            +
      Net Service
---------------------------------
 = Balance on goods and services
            +
        Net transfers
---------------------------------
 = Balance on current account

Capital Account:
----------------
Offical capital transactions
            +
Non-offical capital transactions
---------------------------------
 = Balance on capital account

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Converted on 22 Jul 1996 with RexxDoesAmigaGuide2HTML by Michael Ranner.