Perspectives on prosperity
Future [inc] is a series of thought leadership pieces written in conjunction with Chartered Accountants Australia and New Zealand. This analysis contributes to the debate for developing the prosperity of Australia and New Zealand.
- The Future of trade
- The future of blockchain
- Public debts and deficits
- The future of work
- The future of offshoring
The future of trade
Are we ready to embrace the opportunities?
Trade has recently come under greater scrutiny, with the US election and Brexit highlighting voter opposition to integration into the global economy. Yet international trade is essential to our modern economy. It gives us access to a wider range of goods and services, stimulates competition and allows us to focus on areas of comparative advantage. Exports currently account for close to 30% of world GDP.
In Australia and New Zealand, exports alone account for 20% and 28% of GDP respectively. With 98% of the global economy beyond the shores of Australia and New Zealand, international trade presents exciting opportunities for businesses seeking to expand.
In December 2016, Australia recorded AUD32.6 billion in exports - the highest level ever in Australian history. This represents an AUD7.9 billion increase on the previous December.
Looking forward, globalisation, technology and policy will be key factors in determining the future rate of growth in international trade. We may not return to the heyday of trade growing at on average double the rate of GDP growth, but there are many signs that there is still a strong future ahead in international trade for Australian and New Zealand businesses.
The future of blockchain
Applications and implications of distributed ledger technology
Technology has transformed how we work, play and do business. It has provided new solutions to old problems, disrupted traditional business models and helped us become more efficient.
The speed and scale of this change are not abating. New developments are still being introduced and applied – and this creates a significant dividend for Australia and New Zealand. The Connected Continent II - 2015 estimated that the digital economy could be worth $139 billion by 2020.
This growth will be underpinned by new technologies. One of these is distributed ledger technology and its most common application – blockchain. The World Economic Forum lists blockchain as one of the top ten emerging technologies of 2016. Distributed ledger technology (of which blockchain is an example) uses cryptographic tools and a distributed consensus process to create a significant innovation in traditional record keeping. It has three main features:
Broader adoption of distributed ledger technology could have wide ranging impacts. This paper investigates the applications and implications of blockchain and distributed ledger technology.
Public debt and deficits
Designing a framework for Australia's future
The two core aims of our society are prosperity (the size of the pie) and fairness (how that pie is sliced up). Governments use fiscal policy - the level of government’s spending and taxing - and the nature and composition of its spending and taxation decisions, to help society meet these objectives.
Australia has an established framework - strategies, objectives, rules and institutional structures - for thinking about fiscal policy. However, this has not prevented some poor policy outcomes in the past.
Most recently, participants in the ‘political economy’ have been focused on achieving surpluses and eliminating debt. While debt management is an important part of managing public finances, it appears that this emphasis has made it harder to progress other policies aimed at Australia’s longer-term prosperity and fairness. The challenge is to address the fiscal pressures without their dominating other policy agendas.
This paper seeks to figure out what went wrong, and, more importantly, how to fix it.
The future of work
How can we adapt to survive and thrive?
Our economy and society are being shaped by large-scale shifts, from globalisation to digital disruption. Businesses are facing more intense pressures to respond to changing customer demands and new market entrants. Policy makers are reshaping their agendas. The forces of disruption are not just being driven by start-ups and felt by business leaders – they’re driving change in the workforce and labour market.
Two-thirds of those with less than five years’ experience (early-career Australians) expect that their job will not exist, or will fundamentally change, in the next 15 years. If they are correct, this means that there is likely to be a period of transition. Many will have to reskill, retrain or change jobs.
This paper shows that the workforce will change significantly in coming years. Using an extensive survey, it considers what this means for careers, skills, education and workplaces.
What is the future for offshoring?
The changing landscape
Offshoring has become a common strategy for many services organisations at a time when the services sector is rapidly increasing in importance in Australia and New Zealand.
This paper, prepared by Chartered Accountants Australia and New Zealand with the assistance of Deloitte Access Economics, seeks to explore the future of offshoring for Australia and New Zealand and what it means for organisations and government. It discusses the costs, benefits, risks and opportunities of offshoring business services from Australia and New Zealand.
The findings are based on analysis of trade data, a review of existing studies on offshoring, and consultation with a range of stakeholders, including selected services organisations from Australia and New Zealand that have offshoring experience.