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The Impacts of the Australian Wildfires on Global Business

Connection to Course: In class thus far, we have discussed the concept of globalization and how millions of businesses around the world are connected through trade, travel, and the exchange of ideas and technology. The recent wildfires in Australia personify the notion that local economic problems have negative impacts on the larger international economy. According to estimates, the wildfires will cost Australia roughly $5 billion in economic losses. Furthermore, the catastrophic natural disaster has chipped away at farming, tourism, and exports. Most importantly, consumer confidence has depleted because both domestic consumers and foreign importers no longer trust Australia’s volatile environment. In broad retrospect, the wildfires will harm the interests of local workers, foreign companies that import Australian products, and Australian businesses that benefit immensely from tourists and visitors. In the long term, Australia’s performance on the international market may decline as foreign investors may perceive that investing in the Australian market is far too risky. Australia has traditionally been a hub for FDI; however, now, investors might invest their funds elsewhere.

Opinion: Based on my recent studies, I know that global warming is one of the main driving forces behind the proliferation of wildfires in dry, hot, and humid areas. While there is little that can be done to prevent these wildfires from occurring, various forms of structural and nonstructural mitigation can be integrated to control the wildfires in the early stages. The first form of structural mitigation is using nonflammable construction materials in areas prone to wildfires. Essentially, in residential and commercial regions surrounded by forests, all buildings should be constructed using metal, aluminum, and other nonflammable materials. In terms of nonstructural mitigation, the authorities must raise awareness and increase education on how to prepare and respond to wildfires. Historical precedent indicates that many wildfires are triggered by unintentional actions and mistakes. If citizens are more aware of behaviors that can trigger wildfires, Australia and other countries can prevent such catastrophic incidents from occurring. Overall, Australia must do more to return consumer confidence and jumpstart businesses negatively impacted by the wildfires.

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