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Australia was first used as a penal colony by the British.

It depends upon the context. The first European use of Australia was as a penal colony and free settlement by the British.

However, apart from the indigenous aboriginal population, Australia was first used as gathering grounds for trepang, or sea-slugs, by the Macassan traders, because trepang was a prized delicacy in China.

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Q: What was Australia first used as?
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