Australia is a large island continent that is located on the south-east of Asia. Covering a total area of 7,617,930 km2 (Australia G., 2012) with a population of 22,876,023 individuals as per the 2012 estimate (Australia), it happens to be very large country with a relatively small population. Australia is one of the most urbanized countries in the world. Since vast tracts of the country are not only uninhabited but also uninhabitable, there is a lack of a domestic market. Hence, there is a need for Australian businesses to look for international markets in order to ensure their future prosperity.
Currently, Australia has the world's thirteenth largest economy and the fifth highest GDP per capita of $66,984 as of 2011 (Fund, 2012). The Australian Securities Exchange is now, the ninth largest stock exchange in the world (On the International Realignment of Exchanges and Related Trends in Self-Regulation, 2010). In 2011, it was the 13th largest national economy by nominal GDP of U.S.$1.6 trillion. (12ht) (Field listing - GDP (official exchange rate)).
Australia is self sufficient with rapidly developing agricultural and manufacturing industries. In recent years, Australia has increased its economic focus and has become one of the most dominant and advanced market economies in the world with increasing demands from its trading partners. Australia's main trade partners are Japan, Europe, China, Indonesia, Korea, USA and New Zealand (Compostion of Trade Australia 2008-09, November 2009). These are basically Australia's largest export markets. Australia makes export revenue of approximately $103 million per annum. Its major exports are agricultural produce, including wheat, meat, and wool. In addition to these, it also exports minerals such as gold, iron ore, alumina and fuels such as coal and natural gas. Australia also is the fourth largest exporter of wine, with a whopping $5.5 billion industry contributing to the country's GDP. Machinery and transport equipment are also essential exports that contribute to the country's economy.
Striving for this constant progression is backed by certain key business elements that are also an essential part of the Australian culture. Being a nation that is defined by multi-culturism and opportunities, there are underlying concepts to understanding the complexity of this nation's culture. One of the defining aspects of its culture is Egalitarianism. This means that it is a culture that avoids any sort of differentiation between individual. This concept pretty much infiltrates every aspect of the Australian lifestyle and has particular prominence in the business sphere. There is a preference towards parity, modesty, and respect for one another. Arrogance is not at all appreciated. This is why seldom one will find an Australian bragging about their academic qualifications or business success. It also has a major influence on the down-to-earth approach adopted by the Australians in business.
Another defining and highly valued aspect of the Australian culture is the directness and openness of communication. Being literal and to the point is a well-known trait of the individuals of this country. There is a general encouragement to voice out one's opinions even if they're perceived as controversial and confrontational. Those who do this are well-respected in their daily lives. In a business context, this simply means that a lively debate on various issues shall be encouraged by the Australian business counterparts and should well be expected.
Individualism is another highly valued and unique key aspect of the Australian culture. Cultural fusion along with such a diverse population that makes up this country, this is one of them. Interaction with other members of the society is essential. However, one should treat with caution when trying to develop relationships when dealing with their Australian counterparts in any business arrangement. Australians as a nation are very particular about the segregation of the public and private lives of each individual. This is an issue that is given extreme importance and one should keep it in considerations when attempting to develop any sort of personal relationships with the members of the Australian society.
These few cultural forces then affect the way business is done in and with Australia. There are a few traits that are appreciated by Australians in a business context. Punctuality is one of them. Generally lateness creates an impression of a non-serious attitude and unreliability. It might be perceived that one is careless in their business dealings. It is considered extremely rude to arrive late and without notice. It is often expected of foreigners, thus, to be on time. Tardiness to an event is almost a way to offend and upset an Australian. Another feature of the structural hierarchy in the Australian companies is the considerable amount of power and authority that has been entrusted into the hands of the lower level employees. The decisions are made are not only by the high level executives but also the low level staff have a say in it. This also explains a lot about the company structure followed in Australia, which is generally flat with little visible distinction between ranks and statuses.
Australians take their business dealings very informally. In trying to bond and show respect and equality amongst business partners, Australians have the tendency to initiate a first name basis fairly early on in the business relationship. Making connections and sound relationships in this nation is everything. Its of utmost importance that business partners have personal relationships established with their Australian counterparts. Established representatives of the counterparts must be taken into confidence for future help and support. Business dealings are conducted otherwise in pretty much the same manner from there as in any other part of the world. For example, when meeting for the first time in a business context, it is considered polite and customary to shake hands for a brief period before and after the meeting has been conducted. During the meeting, negotiations shall proceed rapidly as Australians have the tendency to be direct and open about what they require of out of and business deal and put it up on the table for debate.
However, all the company policy and procedures shall be followed. There will be no decision taken because of a gut feeling. The entire established rules and regulations shall be kept in mind while coming up with a common ground for a business deal. Since Australians like to involve all levels of staff into the decision making process as they believe in a collaborative effort. From the high level executives to the low level employees and take everyone's input into consideration before coming up with a decision, the negotiations process can be lengthy and slow. Although, it is often stressed that it should not be rushed. Australians take a very result-oriented approach to conducting business.
There are a few business etiquettes that are a norm in the Australian culture that should be followed in order to achieve good results of the endeavor. These include participating in "small talk" before the meeting just to show general interest, respect and establishing a good rapport with the colleagues. However, it is advised an amount of distance should be maintained with Australian colleagues as personal space is a touchy topic. On the other hand, making eye contact throughout the meeting and conversation is also of importance as it helps to build trust. Nor should one drag their personal lives in the midst such dealing as respecting an individual's privacy is of grave importance in the Australian culture. Also, one shouldn't brag about their business abilities or exaggerate facts for Australians do not value self-importance and dislike arrogance. Australians tend make judgments on your business competence based on actions as opposed to words. Being unassuming and modest is the key. Too much of an aggressive technique also puts off Australians as they feel they're being pressured into making a decision which is not really their style.
After considering how the Australians like to conduct business and what their norms are, a spotlight can be thrown on their trading partners. Australia's top ten two-way trading partners in an ascending order are: China, Japan, United States, Republic of Korea, United Kingdom, India, Singapore, New Zealand, Thailand and Malaysia. Australia is a member of the APEC, G20, OECD and WTO organizations. The Australian Government also pursues six high quality FTAs (Free Trade Agreements) with key trading partners where they offer net benefits to Australia and are supportive of global trade liberalization. The FTAs of which Australia is a part of include, ASEAN-Australia-New Zealand (AANZFTA) 2010,Australia-Chile Free Trade Agreement (ACFTA) 2009,Australia-United States Free Trade Agreement (AUSFTA) 2005, Thailand-Australia Free Trade Agreement (TAFTA) 2005, Singapore-Australia Free Trade Agreement (SAFTA) 2003 and Australia-New Zealand Closer Economic Relations Trade Agreement (ANZCERTA) 1983 (Australia's Trade Agreements, 2011).
Although Australia trades with a number of countries on the Asian Bloc, its biggest trade partner since 2007 is China with exports and imports reaching a combined total of $57.2 billion (Uren, 2007). It forms 22% of the total export market for Australia and 15.3% of the total import market. China is closely followed by Japan which comprises of 16% of…