PESTLE Analysis of Australia

Pestle analysis of Australia. Australia (Commonwealth of Australia) is a country that consists of the Australian continent, Tasmania Island, and many other islands. She is the 6th world’s largest country in terms of size and area (7,692,024 square km). Sydney is her largest city and Canberra is her capital.

Brisbane, Adelaide, Melbourne, and Perth are some of the major cities of Australia. Approximately more than 25,737,400 people are living there. It makes her the 53rd most populous country in the world. New Zealand, Vanuatu, the Solomon Islands, East Timor, Indonesia, and Papua New Guinea are some of the neighboring countries of Australia.

Before the invasion of the western colonists in the 17 century, the indigenous people came to the continent and inhabited it 65000 years ago. The western settlement started increasing and the gold rush attracted more settlers. On Jan 01, 1901, all the 6 colonies united and established the Commonwealth of Australia.

Today, we’ll discuss the pestle analysis of Australia. Here we’ll focus on the macro-environment factors of the 6th largest country in the world. For internal factors, check out the swot analysis of Australia. Here’s the pestle analysis of Australia as follows;

Political factors impacting Australia 

Political System

Australia follows the federal constitutional monarchy and liberal democracy as a political, government, and administration system. The role of Prime Minister is the head of the government and the monarch is the head of the state. The Governors and Governor-General work on behalf of the monarch at the state and federal level. She has 10 territories and 6 states.

Alliances

Australia has very good relations with the USA, Canada, China, the UK, Russia, and many other countries of the world. She’s a member of the world’s top platforms and organizations like WTO (World Trade Organization), Pacific Island Forum, ASEAN plus Six Mechanism, Commonwealth of Nations, Asia Pacific Economic Forum, OECD (Organization for Economic Co-operation and Development), United Nations, ANZUS, and G20.

Stable Political Environment

Australia has a stable political environment and it’s one of the main reasons for making it the 13th largest economy in the world. That’s why she attracts the attention of investors from all over the world. The country has a low level of political and government corruption. People think highly of the political and government offices because of the transparency.  

Economical Factors Affecting Australia 

Economic Status

Australia is one of the world’s most advanced developed countries mainly because of the economic strengths. According to an estimate, her annual GDP was 1.375 trillion US dollars in 2020. Out of which, her per capita income was 50,844 US dollars and it’s 10th highest in the world.

Economic Recession

The economic crisis has increased her unemployment rate up to 7% and decreased the country’s annual revenue. The net income and purchasing power of ordinary people have dropped. It’s because of the months of the lockdown and shutdown of businesses.

Real Estate Business

Real estate is a very successful business in Australia. People consider real estate a safe investment. They buy the property and then sell it for a profit later without doing anything.

A lot of the country’s capital is stuck in the real estate business. The same capital could generate thousands of employment opportunities if people invest it in other businesses.

Foreign Offices

Australia is home to the headquarters of many foreign companies and businesses. Many South Asian and Pacific countries consider her a low-cost country compared to the US and UK. That’s why they established their international headquarters in Australia.

Taxes

The maximum tax rate in Australia is 45% of the upper level. It varies and depends on various factors like income level, residents, foreign residents, businesses, and companies.

Imports & Exports

Some of the major imports of Australia are pharmaceutical equipment, furniture, vehicles, plastic, machinery, electrical machinery, precious metals, minerals, medical apparatus, oil, and gas. Some of her major exports are copper, iron, wheat, educational services, ore, beef, financial services, gold, gas, and coal.

Social factors impacting Australia

Demographic

Australia provides a high quality of life, the best education system, healthcare, and a stable environment for businesses. The country has a population of more than 25.8 million people. She has a lower population if you compare it with her area and size. The average life of males and females in Australia is 80 and 84 years old. It’s higher if you compare it with other developed countries.

The country is facing the issues of an increasing number of old and retired people, and the younger generation is declining.

Immigration

Australia has provided shelter to immigrants from all over the world. She has started the mass immigration policy after WWII. Such policies have made her a multi-cultural and multi-ethnical society. The country has faced many conflicts of multiculturalism and that’s why immigration is a sensitive top there.

Social Classes

Australia has 3 major classes in her society; upper class, middle class, and lower working class. The ownership, property, and wealth lifestyle belong to the upper and middle classes. The difference between the upper and lower class is the amount of wealth and bank balance. Approximately 20% of the Australian population falls under the category of the working class.

Higher Education

Australian society wants higher-tech education for their children. The upper and middle class put their children in private schools, colleges, and universities. The lower working class has to go to the government institutes.

Interests & Hobbies

Australian people are adventurous, lively, and hardworking. She’s a sporting nation and her people love watching and playing different sports. She is good at swimming, hockey, and cricket. Her sports industry contributes a lot to her economy.

Technological Factors Affecting Australia 

Tech Investment

Australia has always accepted the latest tech innovation quickly. According to an estimate by WHICH-50, her people have spent approximately roundabout 100 billion dollars on technology.

Financing the Research

Many Australian universities face the difficulty of financing their research and development. National research centers conduct most of the researches. It’s according to her policy. The government and the industries finance 50% and 40% of the total researches.

Access to Encrypted messages

Australia has recently introduced a new law of giving access to the police department. It’s for the security measures. She claims that the police would catch the hackers and criminals if it has access to the information. It raises a serious on the privacy of users.

Legal factors impacting Australia 

Laws

The Australian government has established a different set of laws for the smooth running of businesses and companies. Those laws include consumer laws, competition laws, and trade laws. The Fair Work Act 2009 deals with employment and employee contracts. She has also established privacy laws that how corporations should use the personal information of users.

Environmental factors impacting Australia 

Environmental Challenges

Australia falls under the category of the driest continent on earth. According to a report based on the Senate inquiry, it concluded that environmental changes are raising the question of the national security of the country. It would result in the form of a scarcity of natural resources like food and land, infectious diseases, and water insecurity.

Bushfire

Australia has faced the worst bushfire across the continent in 2019-2020. It burned down approximately 72000 square miles of the total area in different places. Along with destroying 5900 buildings and 2779 houses, it has also killed many endangered species.

Conclusion: Australia PESTLE Analysis Example Country

After an in-depth study of the pestle analysis of Australia, we’ve concluded that Australia is indeed the world’s largest economy. The environmental challenges and the increasing unemployment rate are serious threats to the country. The government should find a way to minimize the threat; while paying heed to the external political, economic, social, technological, legal, and environmental factors.