The world will experience dramatic demographic change over this century. This paper examines the impacts of the global demographic change on the Australian economy at both aggregate and sectoral levels in a global multi-region and multi-sector general equilibrium model. Using a detailed structural model, we simulate demographic shocks of six regions in the world economy as well as Australia's own demographic shock to investigate their impacts on Australian macroeconomic conditions, economic structure, and trade patterns. The results suggest that demographic change in different regions of the world economy will have different impacts on sectors in Australia depending on trade patterns between Australia and other regions. The energy, mining, and durable manufacturing sectors in Australia are the most affected. Demographic change in China, Japan, and Korea has significant negative impacts on Australia, but partly offsetting these shocks are positive demographic shocks from emerging Asia. The overall impact of the rest of the world on Australian GDP is quantitatively negligible, but the impacts on the real interest rate and trade balances are significant. Global demographic change increases Australian real interest rates in the next two decades on the assumption that emerging countries can access global capital markets and take advantage of their demographic dividends.

COVID-19 has disrupted the Chinese economy and is spreading globally. The evolution of the disease and its economic impacts are highly uncertain, making formulation of appropriate macroeconomic policy responses challenging. This paper explores seven plausible scenarios of COVID-19 and the macroeconomic outcomes using a global hybrid DSGE/CGE general equilibrium model. The results demonstrate that even a contained outbreak could significantly impact the global economy in the short run. Economic costs could be significantly avoided with greater investment in public health systems in all economies, particularly in economies where health care systems are less developed and population density is high.