Impact of Resources on the Movement of Products, Capital & People in Australia & the Pacific Islands

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  • 0:00 Natural Resources & Products
  • 3:15 Movements of Capital & People
  • 4:27 Lesson Summary
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Lesson Transcript
Instructor: David Wood

David has taught Honors Physics, AP Physics, IB Physics and general science courses. He has a Masters in Education, and a Bachelors in Physics.

After watching this video, you will be able to describe the resources of Australia, New Zealand, and the other Pacific Islands, and how those resources affect the movement of products, money, and people in this part of the world. A short quiz will follow.

Natural Resources & Products

Natural resources are important to study, because they are drivers of modern economics. Natural resources can be at the heart of an economy, and a strong economy leads to high living standards. In a capitalist system, this in turn affects human behavior, including the movement of people, products, and capital. Today, we're going to talk about the natural resources of Australia, New Zealand, and the Pacific Islands, and how those natural resources lead to this kind of movement.

Australia is a land abundant in natural resources, much of which hasn't even been tapped yet. Australian exports are increasing all the time; indeed the highest level of exports was reached in February 2014, at a value of $23.8 billion U.S. dollars. The natural resources of Australia include most famously coal, iron ore, and gold, but also oil, gas, rare earths, copper, tin, bauxite, silver, uranium, diamonds, and other minerals.

Metals like iron-ore and gold total 28% of Australian exports, but coal isn't far behind at 18%. A full 60% of the coal mined is exported, bringing money to the Australian economy and making them the largest exporter of coal in the world. When it comes to iron ore, Australia produces 50% of China's entire supply each year. Australia is also the second largest gold producer in the world. Much of Australia's mining happens in the west.

New Zealand also has significant natural resources, including coal, timber, silver, gold, iron ore, limestone, clay, and minerals. Oil and gas are major New Zealand exports, and it's a highly mineral rich country. The highest value exports in total, however, are dairy products, timber, oil, industrial machinery, and beverages. While only some of these things are natural resources, the land is still used in the production of secondary products, from dairy to wine. For the native Maori people, fish are also a vitally important resource.

The Pacific islands are much less rich in natural resources that can be exported. Many of them are small and densely populated. Agriculture is important, but much of the farming is subsistence farming, where farmers create just enough to feed and clothe their families, and that leaves much less for export than other, more continental countries.

However, the other important part of the island economies is tourism, and so you could argue that aside from their fertile land, the beauty of the islands could be considered their greatest natural resource. The exception to this rule is the much larger island of Papua New Guinea, which has significant commercial crops, including sweet potatoes, sugar, copra, coffee, cocoa, and rubber. However, even on Papua New Guinea, 85% of the population is made up of subsistence farmers. The most significant exports in the rest of the Pacific Islands are vanilla and squash from Tonga, timber from the Solomon Islands, and sugar from Fiji.

Movements of Capital and People

As already described above, many of the natural resources of these places are exported in the natural form or as manufactured products. This is especially true in Australia, since it has a major product and resource export economy, especially compared to other fully developed countries. This brings capital to Australia, but it also brings people. People come to Australia to set up or work with companies who are taking advantage of these resources; businesses see opportunities and relocate. The same is true to a lesser extent in New Zealand.

The Pacific islands are a little more complex, however. In the Pacific islands, there are less natural resources to exploit, and since subsistence farming is dominant, not as much capital moves to the islands as you might otherwise expect. However, people still move around a lot, because culturally, moving between islands is relatively common compared to the culture in other parts of the world. Indeed, people often have family on other islands.

And then there's tourism: one of the biggest drivers of the movement of people in the Pacific Islands is the attraction of those beautiful islands to tourists. Indeed tourism is becoming an increasingly significant part of their economies and brings thousands of travelers to their shores each year.

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