Australia’s Fires Test Its Winning Growth Formula

The Australian mining and energy industries have long benefited from China’s spectacular growth. China accounts for almost two-fifths of Australia’s exports. A vast fleet of vessels carries coal from northeastern Australia and iron ore and liquefied natural gas from northwestern Australia to Chinese ports.

Coal narrowly trails iron ore as Australia’s biggest export, with liquefied natural gas following close behind. Australia’s combined exports of the three natural resources work out to nearly 7,300 Australian dollars, or almost $5,000, a year for every adult and child in the country, giving broad political influence to the mining industry.

Still, the wildfires are only one factor forcing many Australians to question how long this economic formula will last.

Some worry that Australia has become too dependent on China at a time when the United States is pressuring allies to keep some distance. On the military front, China has become increasingly assertive in the eastern Pacific Ocean. China has built the world’s largest navy. It has established close relations with Australia’s neighbors in the South Pacific. And it has constructed air bases on an archipelago of artificial islands across the South China Sea.

At home, Australian voters have also become increasingly concerned about the growing influence of Chinese money in the country’s political scene.

“Our economy is vitally dependent on China, and yet our security ties are with the U.S., and our economy is vitally dependent on fossil fuels, and yet our landscape is relatively exposed to climate change,” Chris Richardson, the chief Australia economist at Deloitte, said.

Article source: https://www.nytimes.com/2020/01/13/business/australia-economy-wildfires.html?emc=rss&partner=rss