Globalisation on Australia's BOP and exchange rate (1 Viewer)

[ay_caramba]

hi
i just had my half yearly eco exam today which went okay-ish good.. just a bit confused abt the essay section... the question was: Analyse the impacts of globalisation on Australia's B.O.P and exchange rate
so i sorta talked abt how globalisation has opened up Australia to greater financial flows to fund investment in Australia, which has meant Australia has had CAD problems and problems with foreign debt and the "debt trap". For the exchange rate, I mentioned that it is more volatile and subject to speculation since the Aust dollar was floated... blah blah.. ok im typing my whole essay up aaargh
anyways.. anyone have any other things to add- which i could have included in my essay?
thanx

 

[i-color]

mm that sounds pretty good to me...you've linked it to different topics in the course.

you could've expanded heaps on the CAD problems, such as how decrase protection and specialisation due to globalisation has caused CAD to worsen in the short run. However it should improve in the long run. Also, the derefulation of the capital and financial market has meant more capital inflow into australia which you have mentioned already. Also talk about how australia is a capital importer and our imports are relatively price inelsatic so depreciation of the dollar would worsen CAD in short run...and globalisation has made the AUD more volatile. (this links the whole question together)