Environmental and Economic Impacts

Question: Discuss about the Environmental and Economic Impacts. Answer: Impact of economic slowdown of Chinese economy on Australia This article demonstrated the economic slowdown of the Chinese economy and its subsequent impact on the Australian economy (The Sydney Morning Herald 2016). Australia is concerned with this trend as the country is dependent on China for the purpose of exports. There has been a reduction of the gross domestic product of China which means that there has been a reduced growth of Chinese economy (The Sydney Morning Herald 2016). This trend would imply that there is a low possibility of exports to China and this has posed a threat to the Australian economy. Australian economy would not be able to export to China and hence has to look for alternative countries for the purpose of exposing its products (The Sydney Morning Herald 2016). This issue is also likely to impact the corporate credit. The reduced exports would imply a loss in the national revenue of Australia, which would make the country prone to economic recession. This is because the country has low debt to GDP and the Reserve Ban k would also not be able to support in this regard. There have been negative consequences of the economic recession on the economy of Australia (Tonts Plummer and Argent 2014). The country has not sufficient mechanisms to combat the issue of recession. The economic downturn may damage the budget of the Australian economy. The budget has no clear path from recovery and there has been no support from the investors. There has been historical impact of the recession of the Chinese economy on the Australian economy. There has been slow growth of the Chinese economy over the past decade. This was observed during the late 1990s when there was a significant reform of the labour market (Treasury.gov.au 2016). There was also a sharp increase in the foreign debt of Australia which has led a sharp decline of the value of Australian dollar. This has led to economic reforms in Australia such as removal of import, decline of industry assistance and reduction of tariffs (Treasury.gov.au 2016). The reason is the close integration of Chinese economy with the Australian economy. There has been a shift in the nature of ownership of the services of the economy. The economic recession prompted some public entities to convert themselves to private sectors. The two areas which witnessed the maximum impact of the economic recession are the labour and the financial markets. There has been floating exchange rates as well as fluctuations in the interest rates. There has been modification regarding the compensation structure and there has been a change in the negotiation between workers and the companies (Treasury.gov.au 2016). The Australian economy has allocated better understanding of the Chinese economy. The financial structure of the Australian economy is not robust enough and this poses high risk of recession for the Australian economy. The Australian economy should focus on the core business sector so that a stable environment is being created (Epstein and Buhovac 2014). There should be minimal creation of the disputes and resolving the issues with labour unions. The country must find ways to face the phenomenon of economic recession. References Epstein, M.J. and Buhovac, A.R., 2014.Making sustainability work: Best practices in managing and measuring corporate social, environmental, and economic impacts. Berrett-Koehler Publishers. The Sydney Morning Herald. (2016).Australian Breaking News Headlines World News Online | SMH.com.au. [online] Available at: https://www.smh.com.au/ [Accessed 5 Nov. 2016]. Tonts, M., Plummer, P. and Argent, N., 2014. Path dependence, resilience and the evolution of new rural economies: Perspectives from rural Western Australia.Journal of Rural Studies,36, pp.362-375. Treasury.gov.au. (2016).Treasury Home Page | The Treasury. [online] Available at: https://www.treasury.gov.au/ [Accessed 5 Nov. 2016].