What’s gone wrong with our interest rate policy?
The RBA has been forced into lockstep with a misguided US Federal Reserve held hostage by volatile financial markets. Originally published in the Australian Financial Review.
Sunday 07 Mar 2021 | 00:36 | SYDNEY
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Australia’s place in a decarbonising world economy
A welcome change is underway in the international effort to combat dangerous global warming. It will have big implications for the Australian economy.
The United States, European Union and China – the world’s three biggest emitters – are now all targeting net zero emissions by mid-century (
By Roland Rajah
As a national champion departs the scene, a China food fight looms
Food for thought
Picking winners and sacrificing national interests are two things that conservative politicians usually like to hold out as anathema.
But it says a lot about how the meltdown in relations with China is changing economic diplomacy that they are exactly what the federal
By Greg Earl
Economic diplomacy: Federal budget hits and misses
Hide and seek
It says a lot about the extent of the pandemic cash splash and the domestic politics of the federal budget that an unexpected rise in development aid spending didn’t even make the Treasurer’s speech.
Aid spending will rise about 4% this year, confounding expectations that this
By Greg Earl
COVIDcast: Joseph E. Stiglitz on global cooperation in a time of international mistrust
In this episode of COVIDcast, Lowy Institute Research Fellow Alexandre Dayant sat down with Professor Joseph E. Stiglitz to discuss the prospect of global cooperation in a time of rising populism and international mistrust.
China and the Rules‑Based Order
Seven experts debate China’s approach to the rules‑based international order
Economic diplomacy: A snapshot of overseas investment trends
Going outOne of the big questions facing Australian companies in the new world of reshoring and diversification is how to get the balance right in a time of disruption and power shifts. The federal government and two recent independent reports have told business to invest more in Asia, against the
By Greg Earl
Economic diplomacy: Borders, barriers and obstacles
Homeward bound
While Australia’s embrace of economic sovereignty has so far involved more rhetoric than real financial resources, cash incentives for reshoring manufacturing are gathering pace in other countries.
Last week’s €100 billion (A$162 billion) economic stimulus program from French
By Greg Earl
Covid economic recovery a long-term test for Australian leadership
Although Melbourne’s secondary wave of coronavirus infection has been a significant setback, Australia’s economic recovery from the pandemic is well underway. We must now grapple, however, with the enduring aftermath of high and rising unemployment, a sharp increase in government debt, a
By John Edwards
Economic diplomacy: Spilled milk and foreign wages
Taking one for the team
Spare a thought for Japanese company Kirin, which entered Australia in the vanguard of new ambitions for Asian economic engagement but is now a victim of an undeclared trade war with China.
Treasurer Josh Frydenberg’s move to prevent Kirin selling its unsuccessful Lion
By Greg Earl
The Costs of COVID: Australia's Economic Prospects in a Wounded World
Despite a COVID-constrained global economy, rising unemployment and high government debt, meeting the fiscal challenge is within Australia's means
By John Edwards
Australia doesn’t need to choose between guns and butter
The Morrison government’s plan for defence spending outlined in the Defence Strategic Update last month has been incorporated into the Canberra consensus, with Labor offering no criticism and the mainstream press largely supportive. Yet as the government grapples with debt and deficit as the
By Frank Yuan
Economic diplomacy: A call to syringes, not arms
Going out or staying in
With Australia experiencing its first recession in a generation, potential differences are emerging over whether future prosperity will come from more business integration with high-growth Asia or from preserving capital for economic sovereignty at home.
These, of course,
By Greg Earl
Submission to the Joint Standing Committee on Foreign Affairs, Defence and Trade Inquiry into the Implications of the COVID-19 Pandemic for Australia's Foreign Affairs, Defence and Trade
Joint submission by Lowy Institute researchers to the JSCFADT inquiry into the implications of the pandemic.
Economic diplomacy: Post-Covid trade, from decoupling to wet markets
Multilateralism lives
With European leaders having just spent five days in close-contact negotiations in Brussels and now Australia’s first offshore ministerial visit for almost five months to Washington, a post-Covid diplomatic agenda is tentatively taking shape.
Just what Covid 19 might
By Greg Earl
Modern Monetary Theory and mainstream economics converging
Stephen Grenville gives a detailed account in the Eureka Report on Modern Monetary Theory (MMT), which after a decade on on the periphery of economic discussion, has recently surged in popularity
Economic diplomacy: Diversification dilemmas
Costing the D word
Diversification might be the word of the moment in the lexicon of Australian trade debate, even though few advocates make much attempt to explain how it will actually work.
But now we have two interesting efforts to quantify just how selected reductions in trade with China in
By Greg Earl
Emerging From COVID: Policy Responses To The Pandemic
In this new feature, Lowy Institute experts provide policy recommendations for Australia to address issues that are critical to our nation’s — and the world’s — successful emergence from the pandemic
Emerging from COVID: Policy Responses to the Pandemic
Lowy Institute experts provide policy recommendations for Australia to address issues that are critical to our nation's — and the world's — successful emergence from the pandemic
The World After COVID
How will the COVID-19 pandemic change the world? Lowy Institute experts provide their analysis
Economic diplomacy: Rising risks and missing links in a pandemic
China syndrome
Former Trump administration economic adviser Kevin Hassett had a backhanded compliment for Australia amid this week’s financial market turmoil when he described it as a closely watched proxy for the Chinese economy.
Complaining that Chinese data on the recovery from coronavirus
By Greg Earl
Car manufacturing and Australia: Nothing ventured, nothing gained
Clayton Christensen’s 1997 book The Innovator’s Dilemma provides a series of compelling examples of companies ignoring or dismissing the disruptive potential of immature technologies until it’s too late, only for their upstart competitors to consign them to the dustbin of
What’s so strategic about baby-food?
The discussion about China’s bid for baby-formula supplier Bellamy’s Organic shows the usual confusion about just what should guide decisions on foreign investment in Australia.
Of course there will be some proposals that are defence-strategic. But baby formula is not one of them. Nor is
Economic diplomacy: China dependency and a notable departure
Switch hitting
If Australia’s senior international ministers were surprised by the sharpness of US Secretary of State Mike Pompeo’s approach to economic dependence on China at the recent AUSMIN talks, they should have studied the US trade data the previous day.
A great divergence
By Greg Earl
Economic diplomacy: Japan investment gazumps China, plus election on
Investment: smaller is bigger
There was a time when Asian investment in Australia was all about getting access to scarce resources and if Australia really punched above its weight in regional affairs, it was due to its lucky endowment of iron ore, coal and gas.
The debate about how we best exert
By Greg Earl
Economic diplomacy: trade ground shifts despite US-China row
Deal or no deal
Global trade experts meeting in Australia this week have expressed some confidence that an interim deal will be reached by the end of the month.
As markets swoon amid the latest rumours about US-China trade negotiations, global trade experts meeting in Australia&
By Greg Earl
The Economist: a change of heart
This week’s Economist magazine features Australia on the cover with the caption: “Aussie Rules: what Australia can teach the world”. Inside, the text is effusive: Australia is “the wonder down under”, “possibly the most successful rich country”.
How times (and predictions) change!
Australia, Asia, and the “Wealth of Nations”
How does Australia’s economy align with those of our Asian neighbours? What are the development challenges facing nearby South East Asian countries? And just how large is China’s economy? These questions are of particular interest this week as the ASEAN-Australia Special Summit is held in Sydney
No urgency in cutting Australian corporate tax
Prime Minister Malcolm Turnbull returned from Washington last month even more convinced of the need for deep cuts in Australia’s 30% corporate tax rate, which is well above that in the US. Given the numbers in the Australian Senate, however, it is unlikely the proposed tax cut will pass.
How
By John Edwards
Company tax cuts: America versus Australia
The expert panel on the ABC’s Q&A program earlier this month was hopelessly confused in comparing Donald Trump’s cut in US company tax with the proposed company tax cuts in Australia. Although it’s often useful to compare domestic economic policy initiatives with those
International vulnerabilities and opportunities for Australia’s universities
On Friday, news broke that the Chinese Embassy had issued a statement in Mandarin on its website urging all Chinese students in Australia to protect their safety. This was reported to have alarmed the university sector, which interpreted the statement as a veiled threat in retaliation for
'Message to Trump – no TPP renegotiation'
Originally published in the Nikkei Asian Review (Photo: Washington Post/Getty Images
Behind the Australia–Canada ‘wine war’
Australia has formally lodged a complaint against restrictions some Canadian provinces have placed on the sale of imported wine in grocery stores, in what has been described, somewhat dramatically, as a 'wine war'.
Australia's action was described in the Ottawa Sun under the headline&
The ill-advised rush for Australia to strike a trade deal with Indonesia
Negotiations for the Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA) entered extra time this week, as negotiators agreed to add an 11th round (the 7th since leaders reactivated the initiative in March 2016) after negotiations in November failed to produce a final deal
Anti-migration sentiment the chief threat to openness
In Choosing Openness Andrew Leigh makes a robust, refreshed case for free trade and investment. Both are important sources of the acceleration of global output growth over the last two decades, and of Australia’s long economic expansion since 1991. But while the case for relatively free investment
By John Edwards
Choosing Openness
Why global engagement is best for Australia
By Andrew Leigh
Staying competitive in a global economy
This is the second in a three-part series on the future of world trade from a global (part 1), Asia Pacific (part 2) and Australian (part 3) perspective.
The toughest message free marketeers have to get across is that encouraging others to open markets is not as important ensuring our economy is
By Alan Oxley
O Canada! Australia's best hope in the global IP struggle
Intellectual property is the current focus of President Trump’s economic team. Commerce Secretary Wilbur Ross published a Financial Times op-ed ('American genius is under attack from China'; paywalled), quoting figures from the recent report of the high-level Commission on the Theft of American
Is the relationship between growth and inflation shifting?
With all of the focus on interest rates, sometimes fundamental assumptions underpinning monetary policy are overlooked in the commentary. At times like this, when there are tentative but unmistakeable signs of possible change in those fundamentals, it’s worth stepping back to look at the big
By John Edwards
Economic diplomacy brief: Corporate Australia puts its stamp on foreign policy
When the federal government embraced the concept of economic diplomacy back in 2014, the key pitch was that listening more to business would take foreign policy beyond traditional 'peace and security' to 'peace and prosperity'. With the country's peak business groups having provided submissions for
By Greg Earl
How US protectionism would threaten Australia
The impact of US President-elect Donald Trump's intended withdrawal from the Trans Pacific Partnership (TPP) on Australia could be seen as relatively benign, if one concentrated soley on trade in goods and services.
After all, we have the Australia-United States FTA, concluded in 2004. The
How to be exceptional: Australia in the slowing global economy
While the US and UK have seen political rebellions against migration and trade, Australia has tranquilly entered its 26th year of growth. Australia can in coming decades increase living standards faster than most other advanced economies, despite gloomy prophecies and slowing global growth.
By John Edwards
Good fight for open economy must be fought again
This article was originally published in The Australian Financial Review
Australia and climate change negotiations: at the table, or on the menu?
In this Analysis, Howard Bamsey and Kath Rowley argue that any failure to pay proper, high-level attention to the current international climate change negotiations raises several risks to the national interest. Strong, constructive engagement in those negotiations by Australia would serve climate
G20 Brisbane Summit Form Guide: What will make the Summit a success?
In this Lowy Institute Analysis, G20 Studies Centre Director Mike Callaghan examines what outcomes from the Brisbane G20 Summit in November would help reinvigorate the forum and render this year's Summit a success
China Australia relationship needs to broaden from trade
China-Australia relationship needs to broaden from trade James Brown The Saturday Paper 30 August 2014 Please click here for the online text
By James Brown