Revista del CEI - Centro de Economía Internacional

Budget surplus has a counter-cyclical effect in the two countries, keeping in mind the growth seen in botheconomies. In Argentina, it is linked to debt reduction, the increase in the investment capacity of the State,and the need to bolster an interest rate compatible with the growth in economic activity as well as the needto discourage speculative capital flows. In Australia, the budget surplus increase has made it possible tosustain greater infrastructure and social expenditures, since the government debt, unlike the total one, isvery low. This behaviour suggests a certain degree of both fiscal convergence and objectives.4. Society and Human ResourcesHealth care, the public welfare, employment policies, education, and investment in science and technologyare on the agenda of most political parties and coalitions, academic institutions and sectors representativeof society in both countries. Ensuring an adequate safety net is a firm objective in Australia, on which thereis a general consensus among the political forces and society as a whole. It has also acquired greaterimportance in Argentina, especially after the 2001-2002 crisis, based on the belief that the implementationof such a net is necessary to achieve equality, open opportunities and enable social mobility of the mostdeprived sectors.Access to education from an early age through higher education is not only part of the goal of socialprotection, but also a major requisite for economic and cultural integration into the world, bearing in mindthat education and investment in science and technology are tied to the people’s level of education andtraining, their participation in ever more complex activities, and the generation of programmes to diversifythe economic structure.Although the Argentinean government budgets for education and innovation are substantially lower thanthose of Australia, the recent increases in these line items with the aim of reaching 6% of GDP in the firstcase, and 1% of GDP in the second one over the next years are clear signs of a political intention toreverse the trend observed so far. At first sight, these would confirm that there is also a trend towardsconvergence in this respect.5. The Bilateral LinksIt is not possible to draw conclusions regarding the future without mentioning the evolution and prospectsof bilateral bonds between Australia and Argentina. The multiplication of both political and diplomaticcontacts and those among different sectors of the two societies reveals a growing reciprocal interest,which contributes to promoting a better mutual knowledge and to taking advantage of the current potentialfor expansion of reciprocal relations. Such sectors as nuclear and space technology, air traffic control andequipment, biotechnology, nanotechnology, agricultural and livestock breeding technology, protection ofthe environment, tourism (infrastructure, hotels and related services), and mining prospecting, explorationand exploitation are the sectors which, among others, represent favourable conditions for thediversification of relations consistent with trade, mutual investment and the economic development of bothcountries.Trade, though still not significant, amounted to US$ 275.0 million f.o.b. in 2005, according to data from theAustralian Bureau of Statistics. Argentina’s exports came to US$157.3 million, made up of 55.0% industrialmanufactures (automobiles, equipment for reactors, agricultural machinery, electrical equipment,radioactive materials, steel pipes and tubes, and chemicals). Agricultural manufactured goods, particularlyvegetable fats and oils, tanned leather, fruit juice and candy also had a significant share representing25.0% of the total figure. Primary products, among them fresh and frozen fish, unprocessed tobacco,minerals and vegetable raw materials made up the rest. Australian exports, of the order of US$ 117.7million, were made up by 71% of pit coal for the iron and steel industry. Vegetable raw materials and woolrepresented 7.0% while the remaining 22% corresponded to industrial manufactures, especially aircraftsand spare parts, civil engineering machinery, specialised industrial machinery, chemicals, drugs, transportmachinery and equipment, and measuring instruments. Over the past three years, the total exchange hasmore than doubled. Argentinean exports have shown a 65.6% increase and Australian exports havesoared by 239% (Figure 3).