Australia

Aboriginal settlers arrived on the continent from Southeast Asia about 40,000 years before the first Europeans began exploration in the 17th century. No formal territorial claims were made until 1770, when Capt. James COOK took possession in the name of Great Britain. Six colonies were created in the late 18th and 19th centuries; they federated and became the Commonwealth of Australia in 1901. The new country took advantage of its natural resources to rapidly develop agricultural and manufacturing industries and to make a major contribution to the British effort in World Wars I and II. In recent decades, Australia has transformed itself into an internationally competitive, advanced market economy. It boasted one of the OECD's fastest growing economies during the 1990s, a performance due in large part to economic reforms adopted in the 1980s. Long-term concerns include pollution, particularly depletion of the ozone layer, and management and conservation of coastal areas, especially the Great Barrier Reef.

Country profile: Australia

The island continent combines a wide variety of landscapes. These include deserts in the interior, hills and mountains, tropical rainforests, and densely-populated coastal strips with long beaches and coral reefs off the shoreline. Isolated from other continents, Australia has an abundance of unique plant and animal life.

The British founded the first settlement and named it Sydney in 1788. Many of the first settlers were convicts. Free settlers arrived in increasing numbers, particularly after the discovery of gold in the mid-19th century.

AT-A-GLANCE

• Politics: Liberal Party PM John Howard leads a conservative coalition; he has been in office since 1996
• Economy: The strong, services-based economy has seen sustained growth; mining and agriculture provide the lion's share of exports
• International: Australia is a regional policeman; further afield, its troops are in Iraq and Afghanistan

Australia's original inhabitants, the Aborigines, numbered a few hundred thousand before the European influx. But two centuries of discrimination and expropriation followed, and at one point the number of Aborigines fell as low as 60,000.

Today 99% of the population are of European or Asian descent, but calls for a formal apology for past injustices towards the Aborigines are still made. Indigenous Australians suffer high rates of unemployment, imprisonment and drug abuse.

The gradual dismantling of the "White Australia" immigration policy in the decades after World War II heralded an increase in the number of non-European arrivals.

Migration continues to shape Australia and is a politically-sensitive issue. The country has taken a tough stance on unauthorised arrivals. Asylum seekers are held in detention centres, which have been criticised at home and abroad, until their cases are heard.

Australia's foreign policy has shifted in the past 20 years or so from Europe and the US to its near neighbours. It mediated between warring groups in Papua New Guinea and the Solomon Islands and deployed thousands of peacekeepers in newly-independent East Timor.

Australia's economy is also geared to Asia. It is a foremost member of Apec, the Asia Pacific Economic Cooperation forum, and aims to forge free trade deals with China and the Association of Southeast Asian Nations (Asean).

The country has considered cutting its ties with the British monarchy. In 1999 Australians narrowly voted against plans for the country to become a republic.

• Full name: Commonwealth of Australia
• Population: 20.6 million (official estimate, 2006)
• Capital: Canberra
• Area: 7.7 million sq km (2.9 million sq miles)
• Major language: English
• Major religion: Christianity
• LIfe expectancy: 78 years (men), 83 years (women) (UN)
• Monetary unit: 1 Australian dollar = 100 cents
• Main exports: Ores and metals; wool, food and live animals; fuels, transport machinery and equipment
• GNI per capita: US $32,220 (World Bank, 2006)
• Internet domain: .au
• International dialling code: +61

Head of state: Queen Elizabeth II, represented by Governor-General Michael Jeffery

Prime minister: John Howard

The Liberal Party's John Howard won a fourth term in October 2004. The economy, national security and Australia's involvement in the US-led coalition in Iraq were the big campaign issues.

Mr Howard's conservative coalition also won control of the Senate, enabling the smoother passage of legislation through the upper house. Having won approval for the sale of the government's stake in the telecom giant Telstra, the prime minister has in his sights labour reform and new laws on media ownership.

Mr Howard, who reached retirement age in July 2004, has said he will lead the Liberal Party for as long as its members want him to. He first took office in 1996, winning a landslide victory over his Labor Party rival, and was re-elected in 1998 and in 2001, when his conservative coalition won 43.1% of the vote.

He has highlighted Australia's robust economy, and the approval of a free trade agreement with the US in 2004, as being among his government's key achievements.

He has also overseen Australia's growing role on the world stage, with the country's active military role in the US-led war on terror and in regional conflicts. Mr Howard, described by US President George W Bush as a "man of steel", has promised to keep Australian troops in Iraq for as long as they are needed.

The Howard government has taken a tough stance on asylum seekers, and the prime minister backs proposed rules which would require new immigrants to pass an English language test and show knowledge of Australian history before becoming citizens.

The government has sought to redefine its relationship with Australia's Aborigines, proposing a system of "mutual obligation" regarding welfare payments.

The Liberal Party governs in a centre-right coalition with the conservative National Party. Born in Sydney in 1939, John Howard is married and has three children. He worked as a solicitor before entering parliament in 1974.

Australia's parliament has a lower chamber, the House of Representatives, and an upper house, the Senate. Individual states have their own parliaments.