Australia's Immigration Debate
Australian Financial News (澳洲财经见闻)
28 March 2018

The following is a translated excerpt of an article published by Australian Financial News (澳洲财经见闻) on the recent immigration debate in Australia:

Resisting immigration? I’m afraid Australia is just ‘firing blanks’

For a country established primarily by new immigrants, immigration is certainly a continuing topic of discussion.

In the last decade (as of 2016/17), with overseas students and mining investment boosting employment over the long term, net overseas immigration in Australia hit a new high, reaching an average annual 217,400 people.

Wage growth has stagnated while property prices have risen rapidly in Sydney and Melbourne. The clamour of anti-immigration rises day by day. Increasingly, some populists also refer collectively to immigrants as “non-Australians” and make difficulties for the latter. But in fact Australia is a multicultural country and 28% of Australians were born abroad.

Those who oppose immigrants tend to simply attribute the economic downturn to immigration which has led to an increase in population. In fact, this view is too one-sided. Many people who oppose immigration see the competition for housing and jobs as having been brought about by it and overlook the immigrants’ contribution to employment. They have also ignored the synergy of the whole being more than the sum of the parts. In fact, Australian immigration and development is not a zero-sum game.

The federal government’s mode of thinking has changed significantly in the recent past. The abolition of the 457 visa indicates immigration policies have been tightened. The motive for this move seems to be once again aimed at obtaining votes. Stabilising the economy or protecting the environment are being used as excuses for prejudice.

Aside from its political stance, Australia seems to have unwittingly exposed a bigger problem.

Without immigration, what will the Australian economy rely on in the future?

Most of the economic growth forecasts are based on a population increase of 400,000 people per year. The scale of the former amounts to one new city.

With mine production reaching full capacity, a decline in resource prices, and the end of the boom in housing in the eastern coastal area, immigration will fall. And the secret weapon of Australia’s economic miracle will no longer exist.

An even more complicated problem is: if you want to increase productivity, you must make major expenditures on infrastructure. These expenditures should have been made in order to cope with the influx of immigrants.

If the Australian government really wants to control the budget deficit, it cannot simply rely on countless new immigrants to promote the economy and increase the tax base. Otherwise, the government will have to face serious financial problems.

Maybe they will seriously consider a resource rent tax instead of looking at the national wealth as inexhaustible and do nothing. Tax cuts on foreign companies may give way to corporate taxation. Furthermore, it raises the question: can we afford tax incentives for rich people’s pension funds and property investment? The answer is perhaps. However, doing so will inevitably come at the cost of a recession.

There is a very simple relationship between immigration and economic growth. The bigger the population, the bigger the economy. The greater the population, the more products and services are consumed.

There is nothing wrong with promoting economic growth through immigration. But in the past 20 years in Australia the mistake that the government has made is: on the one hand, they are happy to see the good economic growth; on the other hand, they are completely unwilling to make necessary expenditures to ensure that the economy can cope with the demand from large for immigration inflows.

As a result, many of our large cities are overwhelmed. The infrastructure is outdated. Public utilities cannot meet demand. This situation in turn adversely affects our productivity, leading to further distortion of our distribution of wealth.

With the economic achievements we are about to achieve, leaving aside the original GDP data, we have just advanced one small step.

If Australia’s economic performance is assessed in terms of per capita GDP growth, we will find that our economic growth has not been so brilliant.

In terms of its annual growth rate, our per capita GDP growth is only 2% higher than during the recession 25 years ago. And this 2% only lasts for a few years into the new millennium. It has remained at 1.5% and 1% for most of the time.

Immigration should be viewed as an optimistic opportunity for development. On the contrary, political decision-makers should not bow to narrow-mindedness, ignorance and intolerance.

Translation by: Chris R. Lanzit, NAATI Certified Professional Translator (Chinese-English), NAATI Practitioner ID: CPN0BC84W

Date of translation: 5 April 2018

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