In pursuit of its economic interests as a growing high income country, Australia continued to play an active part in world economic affairs during the ’sixties. Hitherto largely dependent on the West – particularly the United Kingdom – for much of its development capital and trade, it has increasingly felt negative pressures from Europe fortunately offset by positive opportunities in Asia and the Pacific. There has been a diversion of an increasing proportion of its trade to these latter areas, and a ready acceptance of a growing amount of capital from North America as well as from the United Kingdom.

Before 1939, Australia invariably looked to Britain for economic leadership. Britain held a key role in the world economy, and traditionally had been Australia’s chief customer, vendor, shipper, creditor and banker and the principal reservoir of Australian immigration. Insofar as Australia had an international economic policy, therefore, it was that of strengthening and adapting existing economic ties with Britain and the British Commonwealth, to Australia’s advantage; and, when the choice was required, of maintaining British relationships at the expense of those with the rest of the world. There was very little use of economic policy as an adjunct of foreign policy, possibly because Britain was regarded also as Australia’s mainstay of defence.