EU Thrusts Sickle Down Under

As the aftershocks of the Asian financial crisis ripple on, Australia has turned to Europe for help. What’s happening to this outback haven in the Pacific?
From the January 2000 Trumpet Print Edition

“Guten morgen,” the class bellowed as we gathered for another lesson in the German tongue. As a teenager growing up in the northern Australian state of Queensland, I was required by state law to study a foreign language for my first two years of high school. Until recent times, French and German were the stock foreign languages taught throughout Australian schools.

Great efforts have been made by Germany to integrate their language into Australian education. To date, 15 universities and over 50 secondary schools offer German language programs. Also, there are three German-language newspapers in Australia, four language directories, 32 associations and clubs, 38 weekly radio programs, a regular national television program and nationwide satellite and cable coverage of German broadcast giant Deutsche Welle.

Australia has a long history of German influence. Over the past 200 years, many Germans have chosen to start new lives for themselves in Australia. The first German subsidiary was formed as early as 1863. During the following century, several more companies established themselves. However, the past 20 years have seen the strongest growth of German investment in Australia. By 1996, 260 German companies, maintaining an additional 400 branches, were established in Australia.

Diplomatically, Australia has an embassy in Berlin and a consulate-general in Frankfurt. Germany, however, not only has its embassy in Australia’s capital, Canberra, it also maintains seven additional consulate-general offices, one in every state. Thus, Germany’s presence in Australia far outweighs Australia’s presence in Germany. This imbalance is a trademark of Australian-German relations.

Europe’s most powerful and influential financial institution, Deutsche Bank, has expanded business in Australia to include investment banking, where the group is ranked as the number-one foreign bank in overall global market activities, structured finance and corporate advisory services, and ranked number three in equities. The group is also ranked in the top five in institutional funds management with Aus$24 billion currently under management.

Their Teutonic sense of order has led German corporations, cloaked in their European coat of many colors, to march into the global market as the foot-soldiers of a resurgent, expansionist Germany.

Partnership 2000 Action Plan

The Germans see an East Asian market that is 18 times larger than the Australian market, with annual imports of around $1.4 trillion worth of merchandise.

In 1995 Australia and Germany signed “The Australia-Germany Partnership 2000 Action Plan.” This agreement, vigorously supported by Australia’s Irish-Catholic Socialist Prime Minister of the time, Paul Keating, and then-German Chancellor Helmut Kohl, mapped out Germany’s future in Australia.

The Germans wanted to use the Western-bred outpost of Australia as their regional headquarters of operations, in a cash for power-base deal. To Australia, the deal sounded almost too good to be true. Sorely in need of foreign capital investment, like a kid in a candy store they agreed to the deal.

As a result, German investment in Australia more than doubled between 1995 and 1997. Germany began to flood Australia with goods and services, becoming the country’s third-largest importer behind the United States and Japan.

Then came disaster—the Asian financial crisis. Australia, already running on empty due to national over-consumption throughout the 1980s, needed an economic shot in the arm. It was Germany and the EU which supplied it. By then, Kohl was out of office, and Gerhard Schroeder had assumed the mantel of German chancellor.

In February 1999, German Foreign Minister Joschka Fischer, in cooperation with Australia’s liberal-national government, revised “The Australia-Germany Partnership 2000 Action Plan,” expanding economic relations significantly. The revamped deal covered a huge array of industries, from trade, investment, tourism, education, the environment and science to technology, culture and the arts.

Deutsche Bank soon decided to establish its regional Asia-Pacific headquarters in Sydney for euro currency trading. Deutsche then purchased Bankers Trust Corp. Australia, becoming the country’s largest foreign bank. In late 1999, Deutsche turned over their Australian-based Bankers Trust Corp. for Aus$2.1 billion, netting a handsome profit. In the meantime, the Munich-based Allianz AG, the world’s largest insurer, lifted its stake in Australia’s MMI Ltd. to take control of the company. Following suit, the German airline Lufthansa established its Asian booking headquarters in Melbourne.

Thyssen, Daimler-Benz, Hochtief, Lurgi, Bilfinger, Berger, vdo, Hoechst, Siemens and Hella have all created networks of partnerships throughout the country.

Apart from using Australia as their springboard into Asia and as a regional headquarters, Germany’s corporate Australian inroads are further signs of the extent to which business in the world’s third-largest economy has changed its previous view of Australia as being simply a source of raw materials and resources.

Recent sales figures show an expanding German interest in Australia’s automotive trade. Mercedes Benz, bmw, Volkswagen and Audi have all upped their stake in their base in the Pacific.

In return, three major Australian cinema groups, Village Roadshow, Hoyts and Greater Union, have been establishing a presence in Germany’s growing cinema market. Small pickings compared with German investment in Australia.

The recent growth of trade and investment between Germany and Australia is breathing new life into their political relationship, dramatically reshaped by Germany’s growing interest in the Asia-Pacific.

Where is this all leading?

EU Invasion

Europe is Australia’s largest economic partner, a position it has held for the past eight years. The EU is also Australia’s largest source of investment. As has often been the case, where Germany leads, the European Union closely follows. The EU is the leading foreign investor in Australia, providing Aus$173 billion—34 percent of all investment. The EU, in turn, is the major investment destination for Australia, receiving Aus$48.1 billion—about 24 percent of Australian overseas investment funds.

Thus, Australia has also agreed to allow the EU to use its shores as their base of Asian-Pacific operations.

The European Commission is represented in Australia and New Zealand by a delegation based in Canberra. The commission has had formal ties with Australia since 1981, and New Zealand since 1984.

It is the delegation’s responsibility to keep the EU informed of significant political, economic and other developments within the region.

Agreements with the EU covering wine, customs, telecommunications, finances, maritime interests, education, science and technology have already been signed by both Australia and New Zealand. To date, Australia has signed 20 agreements with the European Commission, and New Zealand eight, in their collective drive to forge closer ties with the EU economic giant.

In November of 1999 the European Commission boldly stated, “The EU is the world’s largest trade partner, accounting for over a fifth of all exports in 1998 and, following completion of the ‘internal single market’ in 1992, one of the world’s most open markets. With 320 million citizens, it is now also the biggest single market in the world and will be bigger still in the next decade” (europa.eu.int).

Australia, on the other hand, once a leading commodity export nation, by March 1999 had descended to the 17th-largest economy of the world.

By the fruits, “the lucky country,” as Australia was once known, appears to be less and less in control of its own destiny, and more and more a servant to the whims of its major trading partner, the Eurobeast (Duet. 28:43-44).

Once, Britain, Australia and New Zealand were inseparable trading partners. When Britain joined the European Common Market, that all changed. Considering the outcome of World War II, it is an intriguing paradox that Germany now exports more material into Australia than does Australia’s founding mother country, Britain. Not only that, German-dominated Europe now exports more to Australia than do Britain and the United States respectively.

In previous issues, the Trumpet has reported EU moves into the African, Eastern European, South American and Asian trade spheres. One thing is certain, the EU has a recurring pattern of integration with international economies, establishing themselves corporately within countries, dominating their imports and investment portfolios, in addition to trading within their own Eurozone. This makes for a predominantly one-sided trading policy, despite the odd bone that is thrown to the lesser trading partner as an incentive to continue the commercial relationship.

Reaping the Whirlwind

In his article “Walking Away From the Past,” Australian Broadcasting Company journalist Marius Benson wrote, “Every country has a past, but Germany’s is so tumultuous and so near that at times it is barely possible to hear the present over its roars.”

God warns through the prophet Hosea that Britain and its Commonwealth nations “have sown the wind, and they shall reap the whirlwind” (Hos. 8:7).

Britain and the Commonwealth nations—Biblical Ephraim—have, as prophesied, gone to their Assyrian “lover” Germany for aid in trade (Hos. 7:11). Australia is willfully being used by Germany and the EU. This is a nation that just 100 years ago formed its Constitution “humbly relying on the blessing of Almighty God.”

As we wrote in our booklet Australia in Prophecy, “The wealth of Australia did not come about by pure chance. It was gifted to it by a beneficent, supreme Creator God, in fulfillment of His promises to the patriarchs Abraham, Isaac, Jacob and Joseph. Australia, the great south land called Sinim in your Bible (Isa. 49:12), was colonized by descendants of Ephraim.”

Once rich, prosperous and blessed of God, Australia has forgotten its heritage as a loyal subject of the British monarchy, possessor of the “throne of David” and the “stone of destiny.” Over the past 15 years, Australia has been steadily moving away from its traditional trading partners, Britain and the United States, and gravitating toward the Asian and European trade blocs. Australia has turned to foreign “idols,” populating itself increasingly with “strangers” (Deut. 28:43-44) and multiplying perverse sexual immorality. It is “broken in judgment” and walking contrary to God’s word, relying on its own reasoning (Hos. 5:11).

Biblical Ephraim is today like a “cake not turned” (Hos. 7:8). These nations look good on the outside, but they are burned out underneath, not yet turned over to reveal their shame.

Australia, as one of these Ephraimitish nations, in the wake of Britain’s decline, is rapidly losing its former wealth, power and prestige. “Therefore will I be unto Ephraim as a moth, and to the house of Judah as rottenness” (Hos. 5:12). Like a moth-eaten coat; you try and put it on and it just falls apart.

Underprepared to protect its vast coastline, Australia is most vulnerable to the hands of its Asian neighbors to the north. Even during World War II, Australia was prepared to divide its country at the “Brisbane Line” and forfeit its great northern and western inland to the rising sun of land-hungry Japan. If not for the courage and commitment of Allied forces under the control of General Douglas MacArthur, Australia would have then become the “white trash of Asia.” The recent entanglement with Indonesia in East Timor is just the tip of the Asian iceberg that threatens to overwhelm Australia. Today, there is no General Macarthur, and Australia is blind to its deep, deep troubles! Going to its economic lovers in Germany and the EU will bring no respite from the coming punishment of tribulation that God will bring upon rebellious biblical Israel (Lev. 26:18; Hos. 9:7). Deep national repentance is the only way out of the black future that lies ahead for Australia.