The foreign policy contains strategies of self-interest that a country selects for safeguarding national interests and fulfilling the objectives of international relations. Strategically, the approaches are integrated with the interest of a specific country or countries. Study of these approaches is regarded as foreign policy analysis. Presently, the increase in the transnational activities and expansion of globalization interacted states with non-state actors. Attempts are made to improve and develop foreign policies that could maximize benefits for international cooperation. The foreign policies are intended to ensure effective decision making is involved through to paramount national interests. Feasibility to accomplish national interests is responded with the nation’s peaceful cooperation or it could result through exploitation. Foreign ministers play an integral role in creating approaches and policies effective for the country to meet different areas considered under foreign relations. The intent of foreign policies scope and change varies from country to country that affects stability and national interests perceived for change. The nature of foreign policies has a lasting impact on the country or many other countries due to the course of IR (International relations). One of the great examples is Monroe Doctrine conflict occurred in the 19th century due to Mercantilism policies in the European countries. The assessment aimed to investigate Australian foreign policy for presenting issues in the Economic relations, the analysis elucidates factors at system, domestic and individual level to guide the theory of change.
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Australian foreign policy
In Australia, foreign policy or foreign relations are highly influenced by its position as an important trading nation and leading donor if humanitarian. The policy is committed to regionalism and multilateralism under the guidance of principles, with its allies to present strong bilateral relations (Parker, & Cahill, 2017). The policy is effectively studied and developed for managing international relations, while, there are concerns associated with the policies regarding terrorism, free trade, economic cooperation, refuges and economic stability in Asia – Pacific. However, the country is actively participating in the Commonwealth of Nations and the United Nation (Dawes, & Flew, 2016). In addition, the history of Australian foreign policy is diligent to support global and regional initiatives. Therefore, the efficiency of the strategies has described it on the basis of excellence as a regional middle power. Economic stability is one of the great concern for every country that gets considerable attention under the phenomenon of foreign policy (Rea, 2016). A number of activities are designed and initiated for performing well in the economic sphere and increasing stability for the country. However, the alignment of the activities has a potential and significant impact on the performance that develops critique for the foreign policy and involved authorities (Parker, & Cahill, 2017). The import of weapons is increased in Australia, the suggested percentage of between the past two decades is increased by 60 percent. According to the ratings of SIPRI, Australia is holding the sixth position as weapon importer at a global level. In addition, Australia has maintained a significant connection with ASEAN and aligning steadfastly to New Zealand through the ties of the 1800s (Watson, 2016). The connections of Australia are long-standing with the US and in recent decades, the country has strengthened its relationship with Asia or Asian countries. It is evident from the composition of Australian foreign policy that the country is paying attention to the network of diplomatic missions (Dawes, & Flew, 2016).
Issues in the foreign policy – Economic relations
The economic conditions of the country are widely regarded as long-term benefits and improvement in the living standards. The economic policy of Australia emphasizes on the uniformity of resources and its optimal use for generating maximum value. However, economic conditions of the country are dependent on land, labour, capital and enterprises (Gray, et.al. 2015). Australia has designed effective rules, laws, and regulations for managing these factors to maximize the contribution and support for better economic conditions. In addition, the foreign economic policy is engaging other countries strategically for using land (a key contributor) to maximize its economic performance (Beer, et.al. 2016).
Australia has completed its 27 years of economic growth, fundamentally the success and transition of the foreign economic policies are directed by the significant challenges faced by the country over the years. It is found that the policy is highly focused on the trading economy, while, the decline in the trading and lack of labour and capital has induced a significant drop in the investment (Gray, et.al. 2015). The most common issues addressed in the past years for the formation of foreign policies are directed with the failure of managing domestic success and growth of the company that has reduced international competitive advantage for the country. Economies and markets are interconnected and pronounced as interplay in international competitiveness and domestic policy (Hawthorne, 2016). After spending too many years, the economic policy is not effective to acknowledge global interconnectedness. In addition, the economic reforms are much needed to be clear about unfinished business. Attention is given to the pathways of the transaction for meeting the need of labour mobility and housing affordability, it is to address the area of contention and duties to fulfil right options for supporting economic policies (Parker, & Cahill, 2017). Australian overall response to cyber warfare threat is reacting lethargy to highlight and change circumstances in the area that are not responding fast to globalization (Rea, 2016).
Fore mostly, US trade policy is changed by Trump in terms of withdrawing from TPP (Trans-Pacific Partnership) FTP (free trade agreement). The pressure was applied to South Korea for improving the trade surplus. While, the phenomenon of trade liberalization is announced in the foreign policy of Australia after the Second World War that is principally engaging Asia- Pacific and Australia to China (Hawthorne, 2016). The improvement in the economic conditions of Australia is supported by the trade in China. While, due to the US the TPP agreement is in testing, adjusting and feasibility position which has chances to impact on the economic relations with involved countries (Beer, et.al. 2016).
Analysis of economic relations
According to Howlett, (2019), from the beginning of economic growth of Australia, there is remarkable transformation evident in the occurrence of rational policy informs in Australia after the 1980s. The transformation is indicating convincing change and development in the national economic policies. However, the policy-makers do have the idea of consequences interconnected to the emergence of new governance strategies. Hocking, (2016), argued that the policy change and development is the most effective step for specifying neoliberal political rationality in the country. The policy informed great benefits to the country as embraced free market in Australia in the decades of 1970s and 1980s. However, McManus argued that a free market would lead to greater inequality in ordinary Australians and populations. Therefore, understanding about the phenomenon of neoliberalism was required for self-identifying and looking the points of turn for the democratic socialist party which turned into biggest mixed market economies at the global level as a notion of redistributing wealth and dismantling inequality (Nossal, Roussel, & Paquin, 2015).
It is difficult to critique the functionality of neoliberalism in Australia due to the fact of distinction in the Western economies. The economic growth of Australia is evident due to a number of different factors, for instance, stimulus measures in the economic relation and foreign policy that makes it capable of standing with the effects of GFC (Global Financial Crisis) (Howlett, 2019). However, the stimulus measure for Australia is considered as China who is supporting the economic growth of the country by being the largest trading partner of Australia. In addition, the Reverse Bank of Australia has cut large interest rates on the functions and activities (Nossal, Roussel, & Paquin, 2015).
While, in the year 2009, Australia faced an economic crisis which lead to cause problems in the economic stability at large but the situation was praised by OECD (Organization for Economic Cooperation and Development) and IMF (International Monetary Fund) as the Labour Government of that time. It was an effective step to recover or minimize job losses, $42 billion stimuli was offered to Australia (Agung, 2018). These are considered as the short-term measures that made Australia capable of measuring strengths and standing against GFC. It is known as the influential factor that led Australia to face global economic downturn by affecting its long-term reforms. Virtually, there was no government debt that made the conditions worse and increased consistent budget surpluses. The reforms considered in the economic policy in the form of neoliberalism became a shield for Australia that protected from GFC (Smith, Hadfield, & Dunne, 2016).
According to Lowrie, (2016), Australia started embracing the functionality of free trade in the economic policy from the beginning of the 1960s, the European migrants brought mass emigration and economic boom occurred. Primarily, the economy of the country was associated with export only, despite the fact it was considered as most protective economy across the globe. This was the factor that made Australia descended to 1970s recession, it was considered as the sustained and stagflation period for the Australian economy. The trade share of Australia increased between 1973 and 1983 (Maor, 2017). It is stated that Labour Prime Minister Gough Whitlam was the one that brought a fundamental and significant shift in the economic policy of Australia. He introduced a 25% tariff reduction on the processing of trade in 1974 and eventually, it was recorded as the 1974 Trade Practices Act. It was an effective approach to overcome anti-competitive agreements and number of restrictive within Australian industry (Howlett, 2019). In the business and banking sector, to combat restricting from oligopolistic and anti-competitive behaviour it was essential to shift the policies towards FMP (Free Market Policies). However, it is considered as a justification for the democratic policies and changes made in the policies (Smith, Hadfield, & Dunne, 2016).
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In the Constitutional Crisis of 1975, Whitlam was disposed and Malcolm Fraser from the right-wing party was succeeded. In the early 198s, the new model of neoliberalism known as the Anglo-American model was promoted in the counterparts Margaret Thatcher and Ronald Reagan. Latterly, the party blamed for the missed opportunity to inform revolution in the neoliberal economic characteristics as the key policy agenda which was approached by ALP (Nossal, Roussel, & Paquin, 2015). It is stated that the reforms of Whitlam’s paved Australia towards making the economy liberalise under Hawke and Keating. They were a part of politics, in 1983 Hawke was the prime minister who marked economic liberalism that was considered in the financial sector as deregulation. The process further reduced tariffs caused floating and privatization of state assets in 1983 (Smith, Hadfield, & Dunne, 2016).
It is argued that the step was essential for giving the rights and liberty to the common people. In 1996, the Liberal Party returned and five reforms were made in the Australian economy by Prime Minister John Howard and Treasurer Peter Costello (Maor, 2017). The reforms include; change in the taxation system, continuing deregulation in the financial sector, reducing high tariffs, continuing privatization programs for state-owned enterprises and assets. It is stated that deregulation protected banking sector of Australia during GFC. In addition, the dependence of the federal government was eased through designing Goods and Services Tax (GST) increase in the consumption of income was offered through tax applied (Howlett, 2019). The policy of GST was proposed in 1985 originally by Keating but was dropped due to the backlash of welfare groups, trade unions, and businesses. However, the reforms and changes in the economic policies made in these 27 years are directed and contributed to Australian success (Bath, 2015). The reduction in the tax and privatization were the sides that supported political spectrum. The undertaken reforms for labour market and deregulation improved the economic prosperity of Australian that was on average. The appearance of the reforms on the surface induced economic boom in Australia and it was the method that shielded from GFC (Maor, 2018).
It is claimed that neoliberalism is still involved in the reforms and policies, while, the growth of productivity till last decade was expected to impact by the generosity of tax-cuts. Thus, reforms were made to improvise the infrastructure of Australia, the modification was made in the broadband speed, transport, energy, and water. In the ear of 1990s and 2010, the average economic growth of Australia was reduced to 2.6 % from 3.3 % (Cartwright, 2018). It was also estimated that the social equity of the seven richest Australians is far more than 1.73 million poorest citizens. Furthermore, the benefits of unemployment were reduced that increased poverty line for the country and caused an impact on the economic conditions of the country (Smith, Hadfield, & Dunne, 2016).
The origin of these problems led to transform the policies and agendas of economic stability, regulations were formed to change the infrastructure of the country, equal opportunities were offered to the individual. In addition, the direction of exports was considered by Australia to improve the economic growth, it is stated that investment become sensitive in the country due to security issues (Korac-Kakabadse et al, 2017). The factor of capital caused shortfalls in Australia due to production processes, however, it is evident that Australia has great opportunities for foreign investment from the countries like China, Japan, Korea and India (Lowrie, 2016). Also, the national security goals are developed for protecting the rights and legal obligations to promote and strengthening investment in the country. Therefore, the country requires to inform regional economic networks to grow its role in foreign economic development. Strategically, it is a supportive step for Australia that leads to deal with the issues and interact more effectively with the foreign countries (Smith, Hadfield, & Dunne, 2016).
The policy priority in terms of economic relations must be supportive to maintain stronger demand momentum and macroeconomic policies. In addition, the policies must priorities macro-prudential course for reducing complications and macro-financial risks in the current infrastructure. It is essential to sustain promotion and boost broad tax reform that leads to competition and innovation in the economic policy reforms. However, the country is committed to continuing trade and openness for supporting longer-term growth (Parker, & Cahill, 2017).
Increment in the transnational exercises and extension of globalization associated states with non-state entertainers. Endeavours are made to improve and create remote arrangements that could boost benefits for universal participation. The remote arrangements are proposed to guarantee successful basic leadership is included through to fundamental national interests. Practicality to achieve national interests is reacted with country’s serene participation or it could result through abuse. The idea of remote strategies has an enduring effect on the nation or numerous different nations. In Australia, the remote arrangement or outside relations are exceedingly impacted by its situation as a significant exchanging country and driving benefactor if helpful. The arrangement is focused on regionalism and multilateralism under the direction of standards, with its partners to show solid respective relations. Monetary dependability is one of the extraordinary worries for each nation that gets impressive consideration under the marvel of remote arrangement. Various exercises are planned and started for performing admirably in the financial circle and expanding strength for the nation. In any case, the arrangement of the exercises has a potential and critical effect on the execution that creates a study for the remote approach and included experts. It is clear from the organization of Australian remote arrangement that the nation is focusing on the system of political missions.
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