I congratulate Ross Gittins on his article “Everything's coming up roses” in the SMH Online (23/4/08) where he identifies the positive outlook for the Australian economy. There were several omissions though I would like to add:
1. He saids nothing about the positive outlook for Australian food exports, which will add to the glowing outlook for Australian minerals demand
2. Gittins and a number of other people talk about the 2 billion Indians and Chinese people as if they are one market. The notion that half the world’s population is growing at 10% is alluring I am sure, but lets not forget that a great many of them are living the same way as they always have. There is likely one member of the family working in the city sending back a paltry $1/day, given the higher cost of living in the city. The cultural difference between these regions is actually more important than the political boundaries.
3. We might wonder where the metal will come from to give the Chinese and Indians the equivalent standards of living in 20-30 years time. We can also be sure that they will achieve prosperity faster than any economy before. We should not forget however that some of that ‘productivity bonus’ will arise because we are using more compact electronic devices, which cost less but also use consume much less metal. Might we also expect higher recycling levels as we see greater standardisation of computer components. These are the aspect of the ‘growth story’ which are not discussed so much. Everyone only talks the upside. But these are great times for Australia to be sure.
In all other respects this is a good article and it should be read for some insights, or just as a reminder of Australia’s place in the world.
1. He saids nothing about the positive outlook for Australian food exports, which will add to the glowing outlook for Australian minerals demand
2. Gittins and a number of other people talk about the 2 billion Indians and Chinese people as if they are one market. The notion that half the world’s population is growing at 10% is alluring I am sure, but lets not forget that a great many of them are living the same way as they always have. There is likely one member of the family working in the city sending back a paltry $1/day, given the higher cost of living in the city. The cultural difference between these regions is actually more important than the political boundaries.
3. We might wonder where the metal will come from to give the Chinese and Indians the equivalent standards of living in 20-30 years time. We can also be sure that they will achieve prosperity faster than any economy before. We should not forget however that some of that ‘productivity bonus’ will arise because we are using more compact electronic devices, which cost less but also use consume much less metal. Might we also expect higher recycling levels as we see greater standardisation of computer components. These are the aspect of the ‘growth story’ which are not discussed so much. Everyone only talks the upside. But these are great times for Australia to be sure.
In all other respects this is a good article and it should be read for some insights, or just as a reminder of Australia’s place in the world.
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