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Learn about the history of Australia, her government and the Australian economy.

Australia was uninhabited until stone-culture peoples arrived, perhaps by boat across the waters separating the island from the Indonesia archipelago more than 40,000 years ago. Portuguese, Spanish, Dutch, and English explorers observed the island before 1770, when Captain Cook explored the east coast and claimed it for Great Britain (three American colonists were crew members aboard Cook's ship, the Endeavour).

Australia History, Government & Economy

Overcrowded prisons in England and disruption caused by the American Revolution were two key reasons for the first shipment of convicts to the great southern land. It was the explorer and botanist Joseph Banks who, in 1779, suggested that New South Wales would be a fine site for a penal colony!  

For more than 50,000 thousand years, Australia's Aboriginal people have lived and thrived in Australia's unique and challenging natural environment. Australia's rich vegetation and native wildlife helped them establish their presence on the land. Today it is believed the Aboriginals are the world's oldest civilisation.

Terra Australis' was the last landmass to be discovered by European explorers. Talk of this mystical land and the riches it held inspired explorers to sail into the unknown. It wasn't until Captain James Cook arrived in Botany Bay in 1770 that the great southern land was officially discovered by Europeans.


Australia is an independent nation within the Commonwealth. Queen Elizabeth II is the head of state and since 1973 has been officially styled "Queen of Australia." The Queen is represented throughout Australia by a governor general and in each state by a governor.

The Commonwealth government was created with a Constitution patterned partly on the U.S. Constitution, although it does not include a "bill of rights." The powers of the Commonwealth are specifically defined in the Constitution, and the residual powers remain with the states.

Australia is made up of six states and two territories. Each state and territory has its own parliament, flag and floral emblem. Australia became a federated nation after the union of the six colonies on 1 January 1901. Bound by one parliament, one constitution and one flag, Australia celebrated its Centenary of Federation in 2001.

Each state is headed by a premier, who is the leader of the party with a majority or a working minority in the lower house of the state legislature. Australia's two self-governing territories have political systems similar to those of the states. The Territories are headed by Chief Ministers who are the leader of the party with a majority or a working minority in the territories' legislature.

At the apex of the court system is the High Court of Australia. It has general appellate jurisdiction over all other federal and state courts and possesses the power of constitutional review.


Australia's advanced market economy is dominated by its services sector (70% of GDP), yet it is the agricultural and mining sectors (7% of GDP combined) that account for the bulk (57%) of Australia's goods and services exports. Australia's comparative advantage in primary products is a reflection of the natural wealth of the Australian continent and its small domestic market; 20 million people occupy a continent the size of the contiguous United States. The relative size of the manufacturing sector has been declining for several decades, and now accounts for around 11% of GDP.

The ultimate goal is for Australia to become a competitive producer and exporter, not just of traditional farm and mineral commodities, but also of a diversified mix of high value-added manufactured products, services, and technologies. Australia was one of the OECD's fastest-growing economies throughout the 1990s, a performance that owed much to the economic reform program. Despite a transient slowdown in late 2000, it has been 14 years since Australia experienced a recession and economic growth remains robust. Economic growth should be around 3% in 2004, despite the negative effect of the prolonged drought on Australian agricultural exports. The latest predictions suggest that GDP growth will exceed 3% over the next 2 years.

The World War II experience, similarities in culture and historical background, and shared democratic values have made U.S. relations with Australia exceptionally strong and close. Ties linking the two nations cover the entire spectrum of international relations--from commercial, cultural, and environmental contacts to political and defense cooperation. Two-way trade reached $25 billion in 2003. More than 400,000 Americans have visited Australia in a single year.