Foreign Direct Investment in Australia Essay Example | Topics and Well Written Essays - 2000 words

Foreign Direct Investment in Australia - Essay Example Demand for goods and services in the Pilbara's state, Western Australia, grew by 11% in 2007. Studies have touted the benefits of foreign direct investment. (China Elections and Governance, May 8, 2008). Chinese investment in Australia's iron-ore business is increasing. Gindalbie, an Australian iron-ore miner, and Ansteel, a Chinese steelmaker, agreed to invest A$1.8 billion in a joint venture to develop a mine in Western Australia in 2007. This new investment translates to5,000 new jobs. (China Elections and Governance, May 8, 2008) Foreign direct investment (FDI) should be free from the strict controls which are implemented by host governments. (Main Idea Statement). Foreign direct investment has speeded up the economic development of Australia. If the foreign direct investment in the iron ore and coal mining sector continues, Western Australia will need an extra 400,000 workers within 10 years ding to the Australian Chamber of Commerce. Australia has entered its 17th year of uninterrupted growth. The pace of domestic demand that monetary authorities have pushed interest rates to their highest in close to 12 years in order to combat inflation. Inflation has been identified as the country's chief economic ill. Skills shortage and infrastructure bottlenecks at congested ports continue to hound the growing economy. Due to the massive foreign direct investments, Australia's unemployment record is at a 33-year low, net immigration is at a record high and the prices paid for Australia's most important exports such as iron ore, coal and have risen. Moreover, household wealth has more than doubled in 15 years, the national car fleet is younger than befo re and contains more luxury brands, while homes are replete with high-end consumer electronics. The federal and state governments have registered budget surpluses and A$31bn (US$28bn, 14bn, 18bn) in tax cuts will soon be handed to the twenty one million population. The China-led boom in Australia is expected to last for many years as China is heavily dependent on imported raw materials for industrial production.British foreign direct investment in Australia spans several industries. The UK companies dominate EU direct investment in Australia at about 53 per cent. The UK is the second-largest source of direct investment in Australia behind the United States. The level of the UK's direct investment in Australia was about $51 billion. British firms held substantial investments in Australia, setting up operations in the resources and energy sector (for example, Shell and Rio Tinto-Zinc), telecommunications (Vodafone and British Telecommunications) and food and beverages (Cadbury and Uni lever). (DFAT, 2005). Moreover, Germany has 330 subsidiary companies and 470 branch offices in Australia. German investments are in banking and finance (Deutsche Bank), automotives (DaimlerChrysler, BMW, Bosch, Hella and VDO), telecommunications (Siemens) and chemicals (Boehringer, Schering). These investments have increased the economic growth of Australia. (DFAT Report, 2005) Free trade fosters the inflow of foreign direct investment hence, enhancing competition and innovation. (Heritage website). One of the supporting reasons for free trade is greater access to a greater variety of goods and services.The second argument is that trade generates economic growth. The Asean Free Trade Area registered a growth of 8% per annum due to the influx of foreign direct

Strategic Marketing Planningfor SMEs in Zimbabwe Dissertation

Strategic Marketing Planningfor SMEs in Zimbabwe - Dissertation Example When it was termed that the strategic planning was not feasible, practitioners might want to emphasise short term planning for SMEs in Zimbabwe. Further, the findings for the case of SMEs in Zimbabwe could provide a basis for further study on the implications of strategic planning for other developing countries, and for countries in similar economic and political conditions to Zimbabwe. Acknowledgement I am greatly indebted to my dissertation supervisor, Professor David Crick, who has constantly provided me with his support, encouragement, and guidance. Declaration I, Charles Mudekunye, declare that all information in this project has been compiled by me. Any quoting is stated as so, and when references are made to previous work, they appear as references at the end of the report. No part of this dissertation has been submitted in support of an application for another degree or qualification from the university or any other institute of learning. Charles Mudekunye19th September 2006 Table of Contents Abstract 1 Acknowledgement 2 Declaration 3 Table of Contents... The review, analysis, discussion and case studies in the paper conclude that the strategic planning is necessary for the success of SMEs. Too much of it can also result in non-productive situations in the environment like Zimbabwe. The reason is that the long-term strategic planning cannot be applicable for the situation in the Zimbabwe. The reason is that the inflation and interest rates are changing sometimes on a quarterly basis. The market availability for the majority of the businesses was less and this restricts the use of strategic planning. The SMEs are finding tough to get funds in the form of loans as the lending rates are higher. These higher lending rates can come down when the inflation comes down and government decreases internal borrowings. So this lapse cannot be addressed immediately and can be solved in the course of time as the agricultural production increases and people spend less on agriculture and find enough money to spend on other goods. This study makes a conclusion that the prevailing inflation is capable of restricting the majority of the people to spend money on the things other than food, clothing, and housing. As the market was absent, the banks and financial institutions are also not finding enough businesses to lend their money. This, in turn, was resulting in nonavailability of the funds for low interest. The government should not budge to these types of pressures and must encourage the domestic industry to increase the production, which is capable of increasing the value of the ZWD.