we Aussies are trustworthy - but we don't trust you
I will preface this by saying that most of the work I do is with the Federal Govt and they are generally more conservative.
Basically their rules say that your (govt agencies) sensitive data (anything above UNCLASSIFIED) cannot reside on overseas machines or servers (with access by overseas nationals). This basically puts an end to any discussions of outsourcing to non Australian companies, most agencies also have requirements on staff being Australian citizens.
So I guess this has always been a rule that I have lived with so I haven't thought much about it.
Unfortunately though I think those agencies then miss out on some potential efficiencies in High availability and outsourcing of managed services/call centres when they don't really need to (especially if you are signing non-disclosure agreements and contracts with multi nationals).
Of course all that went out the Window a bit when senior government officials wanted to use BlackBerry, an exception was granted for the BlackBerry and its data travelling through RIM in Canada so as usual different rules for the big guys.