The simplest solution to a taxing problem is upping GST
Chalmers is now positioning himself as a crusader against red tape, but it's hard to take that seriously when the Albanese government has introduced 5000 new regulations in its first term, according to recent reports.
There's the usual story of wasteful government spending at every level, but the deeper issues lie in changing demographics.
The number of non-taxpayers is rising rapidly as more of the Baby Boomer generation of Australians retire and live longer - 90 per cent of retirees pay no income tax at all.
Add to this our skewed personal income tax system, where just 12 per cent of taxpayers are footing 62 per cent of the bill, and the imbalance becomes clear.
Just look at the current system. Once a person earns $135,000 a year, they start losing 39 per cent of every extra dollar. That jumps to 47 per cent once they earn $190,000.
These are not very high income figures by today's standards, yet we've created a tax system in which someone earning over $190,000 loses almost half of every additional dollar.
There's something fundamentally wrong with that: it shifts the focus from earning more and being more productive to finding ways to minimise tax - and that's a dead weight on the economy.
The problem is that most taxation changes are difficult to implement.
For years, there's been talk about eliminating the capital gains tax exemption on the family home, but that's a practical impossibility.
No government would dare to do it - and even if they tried, the massive disparity in house prices across Australia would make it unworkable.
There's also ongoing discussion about reducing the capital gains tax discount on assets held for more than 12 months, but again, implementation is tricky.
It's a fundamental tax principle that you shouldn't tax inflation, yet removing or substantially reducing the CGT discount without addressing inflation would do just that.
And if a change was phased in by applying the change only to assets acquired after a certain date, you'd see a frenzy of purchases before the deadline, followed by a slump. The result? Distorted markets, disrupted planning, and more confusion than clarity.
Super is always a target, and now there's talk the government might slap a 15 per cent tax on some pension-phase accounts that are currently tax-free.
But there's a major flaw in that plan: super's purpose is to provide retirement income, and it does that by creating a low-tax or zero-tax haven.
A couple with $800,000 invested in their own names would pay no tax anyway, thanks to offsets and franking credits. Tax their super, and they'll just pull the money out and invest it themselves.
The practical solution is to increase GST to 15 per cent with no exemptions. That would strike a blow to the black economy and ensure retirees contribute something towards the rising cost of supporting them.
Any GST increase will be slammed as regressive - hurting the poor more than the rich - an argument that applies to most embedded taxes. Petrol tax, liquor excise and cigarette duties are all regressive, yet these are widely accepted.
The strength of GST is that it's almost impossible to avoid: it captures a large slice of the cash economy and, while it hits low-income earners hard, it hits big spenders hardest - the more you spend, the more you pay - so those with the most disposable income typically pay more.
Question: I'm 57, have $815,000 in super, and own my home worth $1.3 million. My employer pays super into my fund about six weeks after payday - I get paid on the 14th, but my super doesn't appear until the 28th of the following month. They say this is legal for employer contributions. But I also salary sacrifice each month to reach the cap. Since that's my money, shouldn't it go into my super account the day I'm paid? I'd prefer my investments to start working straight away.
Answer: There is no legislative timeframe placed on employers for paying salary sacrifice contributions to an employee's super fund. You've reached that fortunate position where the earnings on your investments far outweigh your contributions. For example, if you have $815,000 in super, the annual growth should be at least $57,000 a year, or $1,000 a week. If your maximum contributions are $30,000 a year, your net figure after the 15% contribution tax is $25,500, which comes to just $2,000 a month.
The timing of contributions-$2,000 a month net-is minuscule compared to the size of your fund. In any case, because you are in the balanced and growth areas, unit prices fluctuate daily. A contribution that is four weeks late may end up being worth more than one made immediately after you were paid. You're on the right track, -just keep doing what you're doing.
Question: I'm confused about how Centrelink assesses the gold and silver I own. I've been told they are iven a deemed income, even though they don't actually produce any.Of course, as their value rises, my pension decreases. For context, I own and live in my home, which I purchased over 11 years ago, and still have a mortgage. Any time I sell an asset, the proceeds go into my mortgage savings account to pay off my principal and interest, meaning my overall asset value remains fairly static.
Answer: You are correct that gold and silver are subject to deeming under Centrelink's rules. This means that even if you do not sell them, their assessed value can impact your pension..
If you sell part or all of your metals, you must notify Centrelink. While your metal holdings decrease, your bank balance increases, which Centrelink will reassess. When you pay Capital Gains Tax (CGT) to the ATO, this reduces your bank balance. Once the payment is made, you should report the lower balance to Centrelink, which may result in a higher pension.
If you are receiving only a part pension due to asset limits, you might consider using the proceeds from selling metals to pay down your mortgage. Centrelink does not count the mortgage balance as an offset against assets, but selling assessable assets such as metals to reduce your mortgage moves that wealth from an assessable to a non-assessable category. This could lead to an increased pension.
Question: I retired last year but won't be eligible for the age pension until September. I'm not working and don't plan to. Should I keep paying for TPD insurance through my super?
Answer: Insurance comes at a cost, so weigh the chance of claiming against your financial needs. If you're not working and don't plan to, a successful TPD claim may be less likely - especially if your policy requires you to be permanently unable to work in any job. Premiums also rise with age and can eat into your super. Review your policy and decide if it's still worth the cost.
For the umpteenth time, tax reform is back on the agenda - this time as the centrepiece of Treasurer Jim Chalmers' latest talkfest aimed at boosting productivity.
Chalmers is now positioning himself as a crusader against red tape, but it's hard to take that seriously when the Albanese government has introduced 5000 new regulations in its first term, according to recent reports.
There's the usual story of wasteful government spending at every level, but the deeper issues lie in changing demographics.
The number of non-taxpayers is rising rapidly as more of the Baby Boomer generation of Australians retire and live longer - 90 per cent of retirees pay no income tax at all.
Add to this our skewed personal income tax system, where just 12 per cent of taxpayers are footing 62 per cent of the bill, and the imbalance becomes clear.
Just look at the current system. Once a person earns $135,000 a year, they start losing 39 per cent of every extra dollar. That jumps to 47 per cent once they earn $190,000.
These are not very high income figures by today's standards, yet we've created a tax system in which someone earning over $190,000 loses almost half of every additional dollar.
There's something fundamentally wrong with that: it shifts the focus from earning more and being more productive to finding ways to minimise tax - and that's a dead weight on the economy.
The problem is that most taxation changes are difficult to implement.
For years, there's been talk about eliminating the capital gains tax exemption on the family home, but that's a practical impossibility.
No government would dare to do it - and even if they tried, the massive disparity in house prices across Australia would make it unworkable.
There's also ongoing discussion about reducing the capital gains tax discount on assets held for more than 12 months, but again, implementation is tricky.
It's a fundamental tax principle that you shouldn't tax inflation, yet removing or substantially reducing the CGT discount without addressing inflation would do just that.
And if a change was phased in by applying the change only to assets acquired after a certain date, you'd see a frenzy of purchases before the deadline, followed by a slump. The result? Distorted markets, disrupted planning, and more confusion than clarity.
Super is always a target, and now there's talk the government might slap a 15 per cent tax on some pension-phase accounts that are currently tax-free.
But there's a major flaw in that plan: super's purpose is to provide retirement income, and it does that by creating a low-tax or zero-tax haven.
A couple with $800,000 invested in their own names would pay no tax anyway, thanks to offsets and franking credits. Tax their super, and they'll just pull the money out and invest it themselves.
The practical solution is to increase GST to 15 per cent with no exemptions. That would strike a blow to the black economy and ensure retirees contribute something towards the rising cost of supporting them.
Any GST increase will be slammed as regressive - hurting the poor more than the rich - an argument that applies to most embedded taxes. Petrol tax, liquor excise and cigarette duties are all regressive, yet these are widely accepted.
The strength of GST is that it's almost impossible to avoid: it captures a large slice of the cash economy and, while it hits low-income earners hard, it hits big spenders hardest - the more you spend, the more you pay - so those with the most disposable income typically pay more.
Question: I'm 57, have $815,000 in super, and own my home worth $1.3 million. My employer pays super into my fund about six weeks after payday - I get paid on the 14th, but my super doesn't appear until the 28th of the following month. They say this is legal for employer contributions. But I also salary sacrifice each month to reach the cap. Since that's my money, shouldn't it go into my super account the day I'm paid? I'd prefer my investments to start working straight away.
Answer: There is no legislative timeframe placed on employers for paying salary sacrifice contributions to an employee's super fund. You've reached that fortunate position where the earnings on your investments far outweigh your contributions. For example, if you have $815,000 in super, the annual growth should be at least $57,000 a year, or $1,000 a week. If your maximum contributions are $30,000 a year, your net figure after the 15% contribution tax is $25,500, which comes to just $2,000 a month.
The timing of contributions-$2,000 a month net-is minuscule compared to the size of your fund. In any case, because you are in the balanced and growth areas, unit prices fluctuate daily. A contribution that is four weeks late may end up being worth more than one made immediately after you were paid. You're on the right track, -just keep doing what you're doing.
Question: I'm confused about how Centrelink assesses the gold and silver I own. I've been told they are iven a deemed income, even though they don't actually produce any.Of course, as their value rises, my pension decreases. For context, I own and live in my home, which I purchased over 11 years ago, and still have a mortgage. Any time I sell an asset, the proceeds go into my mortgage savings account to pay off my principal and interest, meaning my overall asset value remains fairly static.
Answer: You are correct that gold and silver are subject to deeming under Centrelink's rules. This means that even if you do not sell them, their assessed value can impact your pension..
If you sell part or all of your metals, you must notify Centrelink. While your metal holdings decrease, your bank balance increases, which Centrelink will reassess. When you pay Capital Gains Tax (CGT) to the ATO, this reduces your bank balance. Once the payment is made, you should report the lower balance to Centrelink, which may result in a higher pension.
If you are receiving only a part pension due to asset limits, you might consider using the proceeds from selling metals to pay down your mortgage. Centrelink does not count the mortgage balance as an offset against assets, but selling assessable assets such as metals to reduce your mortgage moves that wealth from an assessable to a non-assessable category. This could lead to an increased pension.
Question: I retired last year but won't be eligible for the age pension until September. I'm not working and don't plan to. Should I keep paying for TPD insurance through my super?
Answer: Insurance comes at a cost, so weigh the chance of claiming against your financial needs. If you're not working and don't plan to, a successful TPD claim may be less likely - especially if your policy requires you to be permanently unable to work in any job. Premiums also rise with age and can eat into your super. Review your policy and decide if it's still worth the cost.
For the umpteenth time, tax reform is back on the agenda - this time as the centrepiece of Treasurer Jim Chalmers' latest talkfest aimed at boosting productivity.
Chalmers is now positioning himself as a crusader against red tape, but it's hard to take that seriously when the Albanese government has introduced 5000 new regulations in its first term, according to recent reports.
There's the usual story of wasteful government spending at every level, but the deeper issues lie in changing demographics.
The number of non-taxpayers is rising rapidly as more of the Baby Boomer generation of Australians retire and live longer - 90 per cent of retirees pay no income tax at all.
Add to this our skewed personal income tax system, where just 12 per cent of taxpayers are footing 62 per cent of the bill, and the imbalance becomes clear.
Just look at the current system. Once a person earns $135,000 a year, they start losing 39 per cent of every extra dollar. That jumps to 47 per cent once they earn $190,000.
These are not very high income figures by today's standards, yet we've created a tax system in which someone earning over $190,000 loses almost half of every additional dollar.
There's something fundamentally wrong with that: it shifts the focus from earning more and being more productive to finding ways to minimise tax - and that's a dead weight on the economy.
The problem is that most taxation changes are difficult to implement.
For years, there's been talk about eliminating the capital gains tax exemption on the family home, but that's a practical impossibility.
No government would dare to do it - and even if they tried, the massive disparity in house prices across Australia would make it unworkable.
There's also ongoing discussion about reducing the capital gains tax discount on assets held for more than 12 months, but again, implementation is tricky.
It's a fundamental tax principle that you shouldn't tax inflation, yet removing or substantially reducing the CGT discount without addressing inflation would do just that.
And if a change was phased in by applying the change only to assets acquired after a certain date, you'd see a frenzy of purchases before the deadline, followed by a slump. The result? Distorted markets, disrupted planning, and more confusion than clarity.
Super is always a target, and now there's talk the government might slap a 15 per cent tax on some pension-phase accounts that are currently tax-free.
But there's a major flaw in that plan: super's purpose is to provide retirement income, and it does that by creating a low-tax or zero-tax haven.
A couple with $800,000 invested in their own names would pay no tax anyway, thanks to offsets and franking credits. Tax their super, and they'll just pull the money out and invest it themselves.
The practical solution is to increase GST to 15 per cent with no exemptions. That would strike a blow to the black economy and ensure retirees contribute something towards the rising cost of supporting them.
Any GST increase will be slammed as regressive - hurting the poor more than the rich - an argument that applies to most embedded taxes. Petrol tax, liquor excise and cigarette duties are all regressive, yet these are widely accepted.
The strength of GST is that it's almost impossible to avoid: it captures a large slice of the cash economy and, while it hits low-income earners hard, it hits big spenders hardest - the more you spend, the more you pay - so those with the most disposable income typically pay more.
Question: I'm 57, have $815,000 in super, and own my home worth $1.3 million. My employer pays super into my fund about six weeks after payday - I get paid on the 14th, but my super doesn't appear until the 28th of the following month. They say this is legal for employer contributions. But I also salary sacrifice each month to reach the cap. Since that's my money, shouldn't it go into my super account the day I'm paid? I'd prefer my investments to start working straight away.
Answer: There is no legislative timeframe placed on employers for paying salary sacrifice contributions to an employee's super fund. You've reached that fortunate position where the earnings on your investments far outweigh your contributions. For example, if you have $815,000 in super, the annual growth should be at least $57,000 a year, or $1,000 a week. If your maximum contributions are $30,000 a year, your net figure after the 15% contribution tax is $25,500, which comes to just $2,000 a month.
The timing of contributions-$2,000 a month net-is minuscule compared to the size of your fund. In any case, because you are in the balanced and growth areas, unit prices fluctuate daily. A contribution that is four weeks late may end up being worth more than one made immediately after you were paid. You're on the right track, -just keep doing what you're doing.
Question: I'm confused about how Centrelink assesses the gold and silver I own. I've been told they are iven a deemed income, even though they don't actually produce any.Of course, as their value rises, my pension decreases. For context, I own and live in my home, which I purchased over 11 years ago, and still have a mortgage. Any time I sell an asset, the proceeds go into my mortgage savings account to pay off my principal and interest, meaning my overall asset value remains fairly static.
Answer: You are correct that gold and silver are subject to deeming under Centrelink's rules. This means that even if you do not sell them, their assessed value can impact your pension..
If you sell part or all of your metals, you must notify Centrelink. While your metal holdings decrease, your bank balance increases, which Centrelink will reassess. When you pay Capital Gains Tax (CGT) to the ATO, this reduces your bank balance. Once the payment is made, you should report the lower balance to Centrelink, which may result in a higher pension.
If you are receiving only a part pension due to asset limits, you might consider using the proceeds from selling metals to pay down your mortgage. Centrelink does not count the mortgage balance as an offset against assets, but selling assessable assets such as metals to reduce your mortgage moves that wealth from an assessable to a non-assessable category. This could lead to an increased pension.
Question: I retired last year but won't be eligible for the age pension until September. I'm not working and don't plan to. Should I keep paying for TPD insurance through my super?
Answer: Insurance comes at a cost, so weigh the chance of claiming against your financial needs. If you're not working and don't plan to, a successful TPD claim may be less likely - especially if your policy requires you to be permanently unable to work in any job. Premiums also rise with age and can eat into your super. Review your policy and decide if it's still worth the cost.
For the umpteenth time, tax reform is back on the agenda - this time as the centrepiece of Treasurer Jim Chalmers' latest talkfest aimed at boosting productivity.
Chalmers is now positioning himself as a crusader against red tape, but it's hard to take that seriously when the Albanese government has introduced 5000 new regulations in its first term, according to recent reports.
There's the usual story of wasteful government spending at every level, but the deeper issues lie in changing demographics.
The number of non-taxpayers is rising rapidly as more of the Baby Boomer generation of Australians retire and live longer - 90 per cent of retirees pay no income tax at all.
Add to this our skewed personal income tax system, where just 12 per cent of taxpayers are footing 62 per cent of the bill, and the imbalance becomes clear.
Just look at the current system. Once a person earns $135,000 a year, they start losing 39 per cent of every extra dollar. That jumps to 47 per cent once they earn $190,000.
These are not very high income figures by today's standards, yet we've created a tax system in which someone earning over $190,000 loses almost half of every additional dollar.
There's something fundamentally wrong with that: it shifts the focus from earning more and being more productive to finding ways to minimise tax - and that's a dead weight on the economy.
The problem is that most taxation changes are difficult to implement.
For years, there's been talk about eliminating the capital gains tax exemption on the family home, but that's a practical impossibility.
No government would dare to do it - and even if they tried, the massive disparity in house prices across Australia would make it unworkable.
There's also ongoing discussion about reducing the capital gains tax discount on assets held for more than 12 months, but again, implementation is tricky.
It's a fundamental tax principle that you shouldn't tax inflation, yet removing or substantially reducing the CGT discount without addressing inflation would do just that.
And if a change was phased in by applying the change only to assets acquired after a certain date, you'd see a frenzy of purchases before the deadline, followed by a slump. The result? Distorted markets, disrupted planning, and more confusion than clarity.
Super is always a target, and now there's talk the government might slap a 15 per cent tax on some pension-phase accounts that are currently tax-free.
But there's a major flaw in that plan: super's purpose is to provide retirement income, and it does that by creating a low-tax or zero-tax haven.
A couple with $800,000 invested in their own names would pay no tax anyway, thanks to offsets and franking credits. Tax their super, and they'll just pull the money out and invest it themselves.
The practical solution is to increase GST to 15 per cent with no exemptions. That would strike a blow to the black economy and ensure retirees contribute something towards the rising cost of supporting them.
Any GST increase will be slammed as regressive - hurting the poor more than the rich - an argument that applies to most embedded taxes. Petrol tax, liquor excise and cigarette duties are all regressive, yet these are widely accepted.
The strength of GST is that it's almost impossible to avoid: it captures a large slice of the cash economy and, while it hits low-income earners hard, it hits big spenders hardest - the more you spend, the more you pay - so those with the most disposable income typically pay more.
Question: I'm 57, have $815,000 in super, and own my home worth $1.3 million. My employer pays super into my fund about six weeks after payday - I get paid on the 14th, but my super doesn't appear until the 28th of the following month. They say this is legal for employer contributions. But I also salary sacrifice each month to reach the cap. Since that's my money, shouldn't it go into my super account the day I'm paid? I'd prefer my investments to start working straight away.
Answer: There is no legislative timeframe placed on employers for paying salary sacrifice contributions to an employee's super fund. You've reached that fortunate position where the earnings on your investments far outweigh your contributions. For example, if you have $815,000 in super, the annual growth should be at least $57,000 a year, or $1,000 a week. If your maximum contributions are $30,000 a year, your net figure after the 15% contribution tax is $25,500, which comes to just $2,000 a month.
The timing of contributions-$2,000 a month net-is minuscule compared to the size of your fund. In any case, because you are in the balanced and growth areas, unit prices fluctuate daily. A contribution that is four weeks late may end up being worth more than one made immediately after you were paid. You're on the right track, -just keep doing what you're doing.
Question: I'm confused about how Centrelink assesses the gold and silver I own. I've been told they are iven a deemed income, even though they don't actually produce any.Of course, as their value rises, my pension decreases. For context, I own and live in my home, which I purchased over 11 years ago, and still have a mortgage. Any time I sell an asset, the proceeds go into my mortgage savings account to pay off my principal and interest, meaning my overall asset value remains fairly static.
Answer: You are correct that gold and silver are subject to deeming under Centrelink's rules. This means that even if you do not sell them, their assessed value can impact your pension..
If you sell part or all of your metals, you must notify Centrelink. While your metal holdings decrease, your bank balance increases, which Centrelink will reassess. When you pay Capital Gains Tax (CGT) to the ATO, this reduces your bank balance. Once the payment is made, you should report the lower balance to Centrelink, which may result in a higher pension.
If you are receiving only a part pension due to asset limits, you might consider using the proceeds from selling metals to pay down your mortgage. Centrelink does not count the mortgage balance as an offset against assets, but selling assessable assets such as metals to reduce your mortgage moves that wealth from an assessable to a non-assessable category. This could lead to an increased pension.
Question: I retired last year but won't be eligible for the age pension until September. I'm not working and don't plan to. Should I keep paying for TPD insurance through my super?
Answer: Insurance comes at a cost, so weigh the chance of claiming against your financial needs. If you're not working and don't plan to, a successful TPD claim may be less likely - especially if your policy requires you to be permanently unable to work in any job. Premiums also rise with age and can eat into your super. Review your policy and decide if it's still worth the cost.
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The global supply chain is more fragile than you think. That comes at a cost
While recent tensions in the Middle East were a fresh reminder of how quickly geopolitical conflicts can escalate, they also cast a renewed spotlight on the fragility of the global supply chain and just how reliant the shipping industry is on a handful of key trade corridors. It's likely that until last week, most Australians had no idea where the Strait of Hormuz was located, nor realised its crucial role in the transportation of the world's oil. The Strait is the only sea passage for oil and gas shipments out of the Persian Gulf, moving an estimated 20 million barrels of oil daily, and threats to close it triggered significant global concern. While the closure didn't come to fruition, it was yet another reminder of the vulnerabilities that exist within the global supply chain, and the severe disruption that can result from just one incident. It's a situation we've seen play out in the past. In 2021, the container ship Ever Given blocked the Suez Canal for six days, holding up billions of dollars' worth of goods and causing global shipping congestion, delays and container shortages that took months to fully resolve. Other significant routes include the Strait of Malacca, Panama Canal and Strait of Singapore, where a major disruption would have significant global ramifications. Australia is particularly vulnerable due to our heavy reliance on imported goods and the fact that we remain a relatively small player in terms of global trade. Routes to Australia are often not as lucrative or as high a priority for the shipping lines as routes to and from Europe and the US, for example. Experience tells us that when all aspects of the supply chain are operating smoothly, global shipping is generally a fast and efficient process. However, efficiency and productivity within the industry has arguably been maximised to such a point that there is no longer any room for error or disruption. Advances in technology mean schedules and estimated delivery times are now monitored to the minute, operating on a best-case scenario that requires all elements to be functioning correctly and as expected. These efficiencies have been driven both by industry and the consumer, with global connectivity and the instant-gratification nature of our increasingly digital world raising expectations when it comes to delivery and shipment times. It means that when disruption hits the supply chain - whether that be geopolitical tension, a significant weather event or another unforeseen incident - the knock-on effect is often far more widespread, with the economic and social impacts lingering for weeks or months after the initial issue is resolved. Unfortunately, the next disruption is a matter of when and not if. But, by understanding the interconnected nature of the global supply chain, and expecting the unexpected, industry stakeholders hope to mitigate potential impacts and avoid pandemic-style pictures of empty shelves in the future. While recent tensions in the Middle East were a fresh reminder of how quickly geopolitical conflicts can escalate, they also cast a renewed spotlight on the fragility of the global supply chain and just how reliant the shipping industry is on a handful of key trade corridors. It's likely that until last week, most Australians had no idea where the Strait of Hormuz was located, nor realised its crucial role in the transportation of the world's oil. The Strait is the only sea passage for oil and gas shipments out of the Persian Gulf, moving an estimated 20 million barrels of oil daily, and threats to close it triggered significant global concern. While the closure didn't come to fruition, it was yet another reminder of the vulnerabilities that exist within the global supply chain, and the severe disruption that can result from just one incident. It's a situation we've seen play out in the past. In 2021, the container ship Ever Given blocked the Suez Canal for six days, holding up billions of dollars' worth of goods and causing global shipping congestion, delays and container shortages that took months to fully resolve. Other significant routes include the Strait of Malacca, Panama Canal and Strait of Singapore, where a major disruption would have significant global ramifications. Australia is particularly vulnerable due to our heavy reliance on imported goods and the fact that we remain a relatively small player in terms of global trade. Routes to Australia are often not as lucrative or as high a priority for the shipping lines as routes to and from Europe and the US, for example. Experience tells us that when all aspects of the supply chain are operating smoothly, global shipping is generally a fast and efficient process. However, efficiency and productivity within the industry has arguably been maximised to such a point that there is no longer any room for error or disruption. Advances in technology mean schedules and estimated delivery times are now monitored to the minute, operating on a best-case scenario that requires all elements to be functioning correctly and as expected. These efficiencies have been driven both by industry and the consumer, with global connectivity and the instant-gratification nature of our increasingly digital world raising expectations when it comes to delivery and shipment times. It means that when disruption hits the supply chain - whether that be geopolitical tension, a significant weather event or another unforeseen incident - the knock-on effect is often far more widespread, with the economic and social impacts lingering for weeks or months after the initial issue is resolved. Unfortunately, the next disruption is a matter of when and not if. But, by understanding the interconnected nature of the global supply chain, and expecting the unexpected, industry stakeholders hope to mitigate potential impacts and avoid pandemic-style pictures of empty shelves in the future. While recent tensions in the Middle East were a fresh reminder of how quickly geopolitical conflicts can escalate, they also cast a renewed spotlight on the fragility of the global supply chain and just how reliant the shipping industry is on a handful of key trade corridors. It's likely that until last week, most Australians had no idea where the Strait of Hormuz was located, nor realised its crucial role in the transportation of the world's oil. The Strait is the only sea passage for oil and gas shipments out of the Persian Gulf, moving an estimated 20 million barrels of oil daily, and threats to close it triggered significant global concern. While the closure didn't come to fruition, it was yet another reminder of the vulnerabilities that exist within the global supply chain, and the severe disruption that can result from just one incident. It's a situation we've seen play out in the past. In 2021, the container ship Ever Given blocked the Suez Canal for six days, holding up billions of dollars' worth of goods and causing global shipping congestion, delays and container shortages that took months to fully resolve. Other significant routes include the Strait of Malacca, Panama Canal and Strait of Singapore, where a major disruption would have significant global ramifications. Australia is particularly vulnerable due to our heavy reliance on imported goods and the fact that we remain a relatively small player in terms of global trade. Routes to Australia are often not as lucrative or as high a priority for the shipping lines as routes to and from Europe and the US, for example. Experience tells us that when all aspects of the supply chain are operating smoothly, global shipping is generally a fast and efficient process. However, efficiency and productivity within the industry has arguably been maximised to such a point that there is no longer any room for error or disruption. Advances in technology mean schedules and estimated delivery times are now monitored to the minute, operating on a best-case scenario that requires all elements to be functioning correctly and as expected. These efficiencies have been driven both by industry and the consumer, with global connectivity and the instant-gratification nature of our increasingly digital world raising expectations when it comes to delivery and shipment times. It means that when disruption hits the supply chain - whether that be geopolitical tension, a significant weather event or another unforeseen incident - the knock-on effect is often far more widespread, with the economic and social impacts lingering for weeks or months after the initial issue is resolved. Unfortunately, the next disruption is a matter of when and not if. But, by understanding the interconnected nature of the global supply chain, and expecting the unexpected, industry stakeholders hope to mitigate potential impacts and avoid pandemic-style pictures of empty shelves in the future. While recent tensions in the Middle East were a fresh reminder of how quickly geopolitical conflicts can escalate, they also cast a renewed spotlight on the fragility of the global supply chain and just how reliant the shipping industry is on a handful of key trade corridors. It's likely that until last week, most Australians had no idea where the Strait of Hormuz was located, nor realised its crucial role in the transportation of the world's oil. The Strait is the only sea passage for oil and gas shipments out of the Persian Gulf, moving an estimated 20 million barrels of oil daily, and threats to close it triggered significant global concern. While the closure didn't come to fruition, it was yet another reminder of the vulnerabilities that exist within the global supply chain, and the severe disruption that can result from just one incident. It's a situation we've seen play out in the past. In 2021, the container ship Ever Given blocked the Suez Canal for six days, holding up billions of dollars' worth of goods and causing global shipping congestion, delays and container shortages that took months to fully resolve. Other significant routes include the Strait of Malacca, Panama Canal and Strait of Singapore, where a major disruption would have significant global ramifications. Australia is particularly vulnerable due to our heavy reliance on imported goods and the fact that we remain a relatively small player in terms of global trade. Routes to Australia are often not as lucrative or as high a priority for the shipping lines as routes to and from Europe and the US, for example. Experience tells us that when all aspects of the supply chain are operating smoothly, global shipping is generally a fast and efficient process. However, efficiency and productivity within the industry has arguably been maximised to such a point that there is no longer any room for error or disruption. Advances in technology mean schedules and estimated delivery times are now monitored to the minute, operating on a best-case scenario that requires all elements to be functioning correctly and as expected. These efficiencies have been driven both by industry and the consumer, with global connectivity and the instant-gratification nature of our increasingly digital world raising expectations when it comes to delivery and shipment times. It means that when disruption hits the supply chain - whether that be geopolitical tension, a significant weather event or another unforeseen incident - the knock-on effect is often far more widespread, with the economic and social impacts lingering for weeks or months after the initial issue is resolved. Unfortunately, the next disruption is a matter of when and not if. But, by understanding the interconnected nature of the global supply chain, and expecting the unexpected, industry stakeholders hope to mitigate potential impacts and avoid pandemic-style pictures of empty shelves in the future.
The Advertiser
33 minutes ago
- The Advertiser
China wants AI in expanded trade deal with Australia
Strengthening ties between Chinese and Australian artificial intelligence researchers could be on the agenda when the prime minister visits China this week, as Beijing seeks to capitalise on trade tensions with the US. With President Donald Trump's tariffs straining relations with Australia's traditionally closest ally, China's top diplomat in Australia Xiao Qian has called for greater collaboration in fields like AI, healthcare and green energy under a revised free-trade deal between the two nations. Prime Minister Anthony Albanese's visit to China on Saturday comes as the Sino-Australian relationship continues to build following a downturn in relations under former Liberal prime minister Scott Morrison. "China and Australia are natural partners with complementary economic strengths," Mr Xiao wrote in an opinion piece published in the Australian Financial Review on Monday. "Standing at a new historical starting point, now is the time to advance bilateral relations with steady progress." Trade volumes between the two nations have bounced back after China lifted sanctions on Australian exports. The ambassador believes Mr Albanese's visit marks an opportunity to broaden the terms of the 10-year-old free-trade agreement. "We are willing to review the agreement with a more open attitude and higher standard, further consolidate co-operation in traditional areas such as agriculture and mining, and actively explore new growth areas in emerging fields like artificial intelligence, healthcare, green energy, and the digital economy, elevating practical co-operation to new heights," Mr Xiao wrote. The promotion of AI ties, amid the Albanese government's agenda to boost productivity, follows similar provisions in recently signed trade deals between Australia and partners such as Singapore, the UK and the UAE. These clauses encourage sharing AI research and commercialisation opportunities between the countries, as well as promoting its responsible use. There are attractive opportunities to deepen research collaboration in the fundamental science of AI, even though there are challenges to expanding the use of Chinese AI programs in Australia, said UNSW Professor Toby Walsh. "It's going to be very hard for us to have too deep relationships within terms of AI, because you can touch upon things like data sovereignty and various other things that we value," the AI expert told AAP. "It's not like just sending them gold and they take it, and that's the end of the partnership. "Sharing technologies like AI could pose significant national security and other risks." Allowing Chinese tech companies access to the Australian market has been a sore spot in the bilateral relationship. In 2018, then-Liberal prime minister Malcolm Turnbull banned the Chinese tech giant Huawei from developing 5G infrastructure in Australia over concerns the Chinese government could force the company to hand over Australians' data or interfere with the network. The decision prompted strenuous protests from Beijing and was a factor behind a subsequent diplomatic fallout. Prof Walsh said there were still areas where collaboration could be beneficial without forfeiting Australian security. "It's about exchanging people, it's training, it's us going to work with them and them coming to work with us," he said. "So it's things that we've always done in terms of scientific exchange, supercharging our science, supercharging their science, and then building our own business off the back of that scientific knowledge. "China will be interested in partnering with us. "We have wonderful medical data, and we have a joined-up healthcare system. "There's huge value in those national data sets we have that no one else has." As the US drives a wedge through a fragmenting global order, Mr Xiao framed China as a like-minded partner for Australia - one that shares Australia's interests in pushing back against unilateralism and protectionism. China is willing to work with Australia to strengthen multilateral organisations like the United Nations and ASEAN, safeguard regional peace and the international rules-based order, and advocate for free trade, the ambassador said. Assistant Trade Minister Matt Thistlethwaite said the government was seeking to strengthen access to China - Australia's largest trading partner - in the best interests of Australians. Strengthening ties between Chinese and Australian artificial intelligence researchers could be on the agenda when the prime minister visits China this week, as Beijing seeks to capitalise on trade tensions with the US. With President Donald Trump's tariffs straining relations with Australia's traditionally closest ally, China's top diplomat in Australia Xiao Qian has called for greater collaboration in fields like AI, healthcare and green energy under a revised free-trade deal between the two nations. Prime Minister Anthony Albanese's visit to China on Saturday comes as the Sino-Australian relationship continues to build following a downturn in relations under former Liberal prime minister Scott Morrison. "China and Australia are natural partners with complementary economic strengths," Mr Xiao wrote in an opinion piece published in the Australian Financial Review on Monday. "Standing at a new historical starting point, now is the time to advance bilateral relations with steady progress." Trade volumes between the two nations have bounced back after China lifted sanctions on Australian exports. The ambassador believes Mr Albanese's visit marks an opportunity to broaden the terms of the 10-year-old free-trade agreement. "We are willing to review the agreement with a more open attitude and higher standard, further consolidate co-operation in traditional areas such as agriculture and mining, and actively explore new growth areas in emerging fields like artificial intelligence, healthcare, green energy, and the digital economy, elevating practical co-operation to new heights," Mr Xiao wrote. The promotion of AI ties, amid the Albanese government's agenda to boost productivity, follows similar provisions in recently signed trade deals between Australia and partners such as Singapore, the UK and the UAE. These clauses encourage sharing AI research and commercialisation opportunities between the countries, as well as promoting its responsible use. There are attractive opportunities to deepen research collaboration in the fundamental science of AI, even though there are challenges to expanding the use of Chinese AI programs in Australia, said UNSW Professor Toby Walsh. "It's going to be very hard for us to have too deep relationships within terms of AI, because you can touch upon things like data sovereignty and various other things that we value," the AI expert told AAP. "It's not like just sending them gold and they take it, and that's the end of the partnership. "Sharing technologies like AI could pose significant national security and other risks." Allowing Chinese tech companies access to the Australian market has been a sore spot in the bilateral relationship. In 2018, then-Liberal prime minister Malcolm Turnbull banned the Chinese tech giant Huawei from developing 5G infrastructure in Australia over concerns the Chinese government could force the company to hand over Australians' data or interfere with the network. The decision prompted strenuous protests from Beijing and was a factor behind a subsequent diplomatic fallout. Prof Walsh said there were still areas where collaboration could be beneficial without forfeiting Australian security. "It's about exchanging people, it's training, it's us going to work with them and them coming to work with us," he said. "So it's things that we've always done in terms of scientific exchange, supercharging our science, supercharging their science, and then building our own business off the back of that scientific knowledge. "China will be interested in partnering with us. "We have wonderful medical data, and we have a joined-up healthcare system. "There's huge value in those national data sets we have that no one else has." As the US drives a wedge through a fragmenting global order, Mr Xiao framed China as a like-minded partner for Australia - one that shares Australia's interests in pushing back against unilateralism and protectionism. China is willing to work with Australia to strengthen multilateral organisations like the United Nations and ASEAN, safeguard regional peace and the international rules-based order, and advocate for free trade, the ambassador said. Assistant Trade Minister Matt Thistlethwaite said the government was seeking to strengthen access to China - Australia's largest trading partner - in the best interests of Australians. Strengthening ties between Chinese and Australian artificial intelligence researchers could be on the agenda when the prime minister visits China this week, as Beijing seeks to capitalise on trade tensions with the US. With President Donald Trump's tariffs straining relations with Australia's traditionally closest ally, China's top diplomat in Australia Xiao Qian has called for greater collaboration in fields like AI, healthcare and green energy under a revised free-trade deal between the two nations. Prime Minister Anthony Albanese's visit to China on Saturday comes as the Sino-Australian relationship continues to build following a downturn in relations under former Liberal prime minister Scott Morrison. "China and Australia are natural partners with complementary economic strengths," Mr Xiao wrote in an opinion piece published in the Australian Financial Review on Monday. "Standing at a new historical starting point, now is the time to advance bilateral relations with steady progress." Trade volumes between the two nations have bounced back after China lifted sanctions on Australian exports. The ambassador believes Mr Albanese's visit marks an opportunity to broaden the terms of the 10-year-old free-trade agreement. "We are willing to review the agreement with a more open attitude and higher standard, further consolidate co-operation in traditional areas such as agriculture and mining, and actively explore new growth areas in emerging fields like artificial intelligence, healthcare, green energy, and the digital economy, elevating practical co-operation to new heights," Mr Xiao wrote. The promotion of AI ties, amid the Albanese government's agenda to boost productivity, follows similar provisions in recently signed trade deals between Australia and partners such as Singapore, the UK and the UAE. These clauses encourage sharing AI research and commercialisation opportunities between the countries, as well as promoting its responsible use. There are attractive opportunities to deepen research collaboration in the fundamental science of AI, even though there are challenges to expanding the use of Chinese AI programs in Australia, said UNSW Professor Toby Walsh. "It's going to be very hard for us to have too deep relationships within terms of AI, because you can touch upon things like data sovereignty and various other things that we value," the AI expert told AAP. "It's not like just sending them gold and they take it, and that's the end of the partnership. "Sharing technologies like AI could pose significant national security and other risks." Allowing Chinese tech companies access to the Australian market has been a sore spot in the bilateral relationship. In 2018, then-Liberal prime minister Malcolm Turnbull banned the Chinese tech giant Huawei from developing 5G infrastructure in Australia over concerns the Chinese government could force the company to hand over Australians' data or interfere with the network. The decision prompted strenuous protests from Beijing and was a factor behind a subsequent diplomatic fallout. Prof Walsh said there were still areas where collaboration could be beneficial without forfeiting Australian security. "It's about exchanging people, it's training, it's us going to work with them and them coming to work with us," he said. "So it's things that we've always done in terms of scientific exchange, supercharging our science, supercharging their science, and then building our own business off the back of that scientific knowledge. "China will be interested in partnering with us. "We have wonderful medical data, and we have a joined-up healthcare system. "There's huge value in those national data sets we have that no one else has." As the US drives a wedge through a fragmenting global order, Mr Xiao framed China as a like-minded partner for Australia - one that shares Australia's interests in pushing back against unilateralism and protectionism. China is willing to work with Australia to strengthen multilateral organisations like the United Nations and ASEAN, safeguard regional peace and the international rules-based order, and advocate for free trade, the ambassador said. Assistant Trade Minister Matt Thistlethwaite said the government was seeking to strengthen access to China - Australia's largest trading partner - in the best interests of Australians. Strengthening ties between Chinese and Australian artificial intelligence researchers could be on the agenda when the prime minister visits China this week, as Beijing seeks to capitalise on trade tensions with the US. With President Donald Trump's tariffs straining relations with Australia's traditionally closest ally, China's top diplomat in Australia Xiao Qian has called for greater collaboration in fields like AI, healthcare and green energy under a revised free-trade deal between the two nations. Prime Minister Anthony Albanese's visit to China on Saturday comes as the Sino-Australian relationship continues to build following a downturn in relations under former Liberal prime minister Scott Morrison. "China and Australia are natural partners with complementary economic strengths," Mr Xiao wrote in an opinion piece published in the Australian Financial Review on Monday. "Standing at a new historical starting point, now is the time to advance bilateral relations with steady progress." Trade volumes between the two nations have bounced back after China lifted sanctions on Australian exports. The ambassador believes Mr Albanese's visit marks an opportunity to broaden the terms of the 10-year-old free-trade agreement. "We are willing to review the agreement with a more open attitude and higher standard, further consolidate co-operation in traditional areas such as agriculture and mining, and actively explore new growth areas in emerging fields like artificial intelligence, healthcare, green energy, and the digital economy, elevating practical co-operation to new heights," Mr Xiao wrote. The promotion of AI ties, amid the Albanese government's agenda to boost productivity, follows similar provisions in recently signed trade deals between Australia and partners such as Singapore, the UK and the UAE. These clauses encourage sharing AI research and commercialisation opportunities between the countries, as well as promoting its responsible use. There are attractive opportunities to deepen research collaboration in the fundamental science of AI, even though there are challenges to expanding the use of Chinese AI programs in Australia, said UNSW Professor Toby Walsh. "It's going to be very hard for us to have too deep relationships within terms of AI, because you can touch upon things like data sovereignty and various other things that we value," the AI expert told AAP. "It's not like just sending them gold and they take it, and that's the end of the partnership. "Sharing technologies like AI could pose significant national security and other risks." Allowing Chinese tech companies access to the Australian market has been a sore spot in the bilateral relationship. In 2018, then-Liberal prime minister Malcolm Turnbull banned the Chinese tech giant Huawei from developing 5G infrastructure in Australia over concerns the Chinese government could force the company to hand over Australians' data or interfere with the network. The decision prompted strenuous protests from Beijing and was a factor behind a subsequent diplomatic fallout. Prof Walsh said there were still areas where collaboration could be beneficial without forfeiting Australian security. "It's about exchanging people, it's training, it's us going to work with them and them coming to work with us," he said. "So it's things that we've always done in terms of scientific exchange, supercharging our science, supercharging their science, and then building our own business off the back of that scientific knowledge. "China will be interested in partnering with us. "We have wonderful medical data, and we have a joined-up healthcare system. "There's huge value in those national data sets we have that no one else has." As the US drives a wedge through a fragmenting global order, Mr Xiao framed China as a like-minded partner for Australia - one that shares Australia's interests in pushing back against unilateralism and protectionism. China is willing to work with Australia to strengthen multilateral organisations like the United Nations and ASEAN, safeguard regional peace and the international rules-based order, and advocate for free trade, the ambassador said. Assistant Trade Minister Matt Thistlethwaite said the government was seeking to strengthen access to China - Australia's largest trading partner - in the best interests of Australians.
Sky News AU
an hour ago
- Sky News AU
Man tried to mow down cop with car: court
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