The economy of Australia is a large mixed-market economy, with a GDP of A$1.69 trillion as of 2017. In 2018 Australia became the country with the largest median wealth per adult. Australia's total wealth was AUD$8.9 trillion as of June 2016. In 2016, Australia was the 14th-largest national economy by nominal GDP, 20th-largest by PPP-adjusted GDP, and was the 25th-largest goods exporter and 20th-largest goods importer. Australia took the record for the longest run of uninterrupted GDP growth in the developed world with the March 2017 financial quarter, the 103rd quarter and marked 26 years since the country had a technical recession (two consecutive quarters of negative growth).
The Australian economy is dominated by its service sector, comprising 61.1% of the GDP and employing 79.2% of the labour force in 2016. East Asia (including ASEAN and Northeast Asia) is a top export destination, accounting for about 64% of exports in 2016. Australia has the eighth-highest total estimated value of natural resources, valued at US$19.9 trillion in 2016. At the height of the mining boom in 2009–10, the total value-added of the mining industry was 8.4% of GDP. Despite the recent decline in the mining sector, the Australian economy has remained resilient and stable and has not experienced a recession since July 1991.
The Australian Securities Exchange in Sydney is the 16th-largest stock exchange in the world in terms of domestic market capitalisation and has the largest interest rate derivatives market in Asia. Some of Australia's large companies include but are not limited to: Wesfarmers, Woolworths, Rio Tinto Group, BHP Billiton, Commonwealth Bank, National Australia Bank, Westpac, ANZ, Macquarie Group, Telstra and Caltex Australia. The currency of Australia and its territories is the Australian dollar which it shares with several Pacific nation states.
Australia is a member of the APEC, G20, OECD and WTO. The country has also entered into free trade agreements with ASEAN, Canada, Chile, China, South Korea, Malaysia, New Zealand, Peru, Japan, Singapore, Thailand and the United States. The ANZCERTA agreement with New Zealand has greatly increased integration with the economy of New Zealand and in 2011 there was a plan to form an Australasian Single Economic Market by 2015.
|Economy of Australia|
Sydney's central business district is Australia's largest financial and business services hub.
|Currency||Australian dollar (AUD) = 0.72 USD|
|1 July – 30 June|
|APEC, G20, OECD, WTO|
|0.2% (Q4 2018)|
GDP per capita
GDP per capita rank
GDP by sector
(March Qtr 2019)
|12.7 million (2017)|
Labour force by occupation
|Unemployment||5.5% (February 2018)|
Average gross salary
|Exports||$190.2 billion (2016)|
|iron ore, coal, petroleum gases, gold, synthetic corundum, wheat and meslin, bovine meat, wool, meat of sheep or goat|
Main export partners
|Imports||$196.1 billion (2016)|
|cars, petroleum, automatic data processing equipment, medicaments, other food preparations, cigars, wine, baked goods, alcohol of less than 80% volume|
Main import partners
Gross external debt
|US$1.487 trillion (30 June 2017)|
|42.3% of GDP (October 2017)|
|Revenues||$461 billion (2017 est.)|
|Expenses||$484 billion (2017 est.)|
|Economic aid||donor: ODA, $3.02 billion (2016)|
|$51.838 billion (Oct 2017)|
Australia's average GDP growth rate for the period 1901–2000 was 3.4% annually. As opposed to many neighbouring Southeast Asian countries, the process towards independence was relatively peaceful and thus did not have significant negative impact on the economy and standard of living. Growth peaked during the 1920s, followed by the 1950s and the 1980s. By contrast, the late 1910s/early 1920s, the 1930s, the 1970s and early 1990s were marked by financial crises.
From the early 1980s onwards, the Australian economy has undergone intermittent economic liberalisation. In 1983, under prime minister Bob Hawke, but mainly driven by treasurer Paul Keating, the Australian dollar was floated and financial deregulation was undertaken.
The early 1990s recession came swiftly after the Black Monday of October 1987, as a result of a stock collapse of unprecedented size which caused the Dow Jones Industrial Average to fall by 22.6%. This collapse, larger than the stock market crash of 1929, was handled effectively by the global economy and the stock market began to quickly recover. But in North America, the lumbering savings and loans industry was facing decline, which eventually led to a savings and loan crisis which compromised the well-being of millions of US people. The following recession thus impacted the many countries closely linked to the USs, including Australia. Paul Keating, who was treasurer at the time, famously referred to it as "the recession that Australia had to have." During the recession, GDP fell by 1.7%, employment by 3.4% and the unemployment rate rose to 10.8%. However, the recession did assist in reducing long-term inflation rate expectations and Australia has maintained a low inflation environment since the 1990s to the present day.
Mining has contributed to Australia's high level of economic growth, from the gold rush in the 1840s to the present day. The opportunities for large profits in pastoralism and mining attracted considerable amounts of British capital, while expansion was supported by enormous government outlays for transport, communication, and urban infrastructures, which also depended heavily on British finance. As the economy expanded, large-scale immigration satisfied the growing demand for workers, especially after the end of convict transportation to the eastern mainland in 1840. Australia's mining operations secured continued economic growth and Western Australia itself benefited strongly from mining iron ore and gold from the 1960s and 1970s which fueled the rise of suburbanisation and consumerism in Perth, the capital and most populous city of Western Australia, as well as other regional centres.
The Australian government stimulus package ($11.8 billion) helped to prevent a recession.
The World Bank expected Australia's GDP growth rate to be 3.2% in 2011 and 3.8% in 2012. The economy expanded by 0.4% in the fourth quarter of 2011, and expanded by 1.3% in the first quarter of 2012. The growth rate was reported to be 4.3% year-on-year.
The International Monetary Fund in April 2012 predicted that Australia would be the best-performing major advanced economy in the world over the next two years; the Australian Government Department of the Treasury anticipated "forecast growth of 3.0% in 2012 and 3.5% in 2013", the National Australia Bank in April 2012 cut its growth forecast for Australia to 2.9% from 3.2%., and JP Morgan in May 2012 cut its growth forecast to 2.7% in calendar 2012 from a previous forecast of 3.0%, also its forecast for growth in 2013 to 3.0% from 3.3%. Deutsche Bank in August 2012, and Société Générale in October 2012, warned that there is risk of recession in Australia in 2013.
The following table shows the main economic indicators in 1980–2017. Inflation under 2 % is in green.
(in Bil. US$ PPP)
|GDP per capita
(in US$ PPP)
(in % of GDP)
|1980||155.1||10,480||2.9 %||10.1 %||6.1 %||n/a|
|1981||176.6||11,744||4.1 %||9.5 %||5.8 %||n/a|
|1982||187.7||12.276||0.1 %||11.4 %||7.1 %||n/a|
|1983||194.2||12,541||−0.5 %||10.0 %||10.0 %||n/a|
|1984||213.8||13,639||6.3 %||4.0 %||8.9 %||n/a|
|1985||232.7||14,635||5.5 %||4.0 %||8.3 %||n/a|
|1986||243.2||15,070||2.4 %||9.1 %||8.1 %||n/a|
|1987||261.6||15,958||4.9 %||8.5 %||8.1 %||n/a|
|1988||282.3||16,917||4.3 %||7.3 %||7.2 %||n/a|
|1989||306.8||18,116||4.6 %||7.6 %||6.1 %||17.1 %|
|1990||323.0||18,811||1.5 %||7.2 %||6.7 %||16.5 %|
|1991||330.4||19,010||−1.0 %||3.3 %||9.6 %||21.7 %|
|1992||346.7||19,747||2.6 %||1.0 %||10.7 %||27.7 %|
|1993||368.8||20,813||3.9 %||1.8 %||10.9 %||30.7 %|
|1994||395.0||22,076||4.9 %||2.0 %||9.7 %||31.8 %|
|1995||414.8||22,891||2.9 %||4.6 %||8.5 %||31.2 %|
|1996||439.9||23,998||4.2 %||2.7 %||8.5 %||29.4 %|
|1997||467.7||25,269||4.5 %||0.2 %||8.4 %||26.0 %|
|1998||495.2||26,472||4.7 %||0.9 %||7.7 %||23.8 %|
|1999||524.8||27,737||4.4 %||1.4 %||6.9 %||22.6 %|
|2000||553.3||28,904||3.1 %||4.5 %||6.3 %||19.6 %|
|2001||580.4||29,940||2.6 %||4.4 %||6.8 %||17.2 %|
|2002||614.0||31,318||4.2 %||3.0 %||6.4 %||15.1 %|
|2003||642.3||32,428||2.7 %||2.7 %||5.9 %||13.2 %|
|2004||688.3||34,337||4.2 %||2.3 %||5.4 %||12.0 %|
|2005||731.4||36,008||2.9 %||2.7 %||5.0 %||10.9 %|
|2006||774.9||37,568||2.8 %||3.6 %||4.8 %||10.0 %|
|2007||829.9||39,487||4.3 %||2.4 %||4.4 %||9.7 %|
|2008||868.9||40,461||2.7 %||4.3 %||6.2 %||11.8 %|
|2009||891.7||40,780||1.8 %||1.8 %||5.6 %||16.7 %|
|2010||924.0||41,675||2.4 %||2.9 %||5.2 %||20.5 %|
|2011||969.0||43,016||2.7 %||3.3 %||5.1 %||24.1 %|
|2012||1,025.3||44,692||3.9 %||1.7 %||5.2 %||27.7 %|
|2013||1,064.4||45,640||2.2 %||2.5 %||5.7 %||30.6 %|
|2014||1,111.9||46,968||2.6 %||2.5 %||6.1 %||34.1 %|
|2015||1,151.7||47,962||2.5 %||1.5 %||6.1 %||37.8 %|
|2016||1,197.2||49,096||2.6 %||1.3 %||5.7 %||40.6 %|
|2017||1,246.5||50,334||2.3 %||2.0 %||5.6 %||41.6 %|
Australia's per-capita GDP is higher than that of the UK, Canada, Germany and France in terms of purchasing power parity. Per Capita GDP (PPP) Australia is ranked 18th in the world (CIA World Factbook 2016). The country was ranked second in the United Nations 2016 Human Development Index and sixth in The Economist worldwide quality-of-life index 2005. In 2014, using constant exchange rates, Australia's wealth had grown by 4.4% annually on average since 2007, compared with a 9.2% rate over 2000–2007. Australia's sovereign credit rating is "AAA" for all three major rating agencies, higher than the United States of America.
The emphasis on exporting commodities rather than manufactures underpinned a significant increase in Australia's terms of trade during the rise in commodity prices since 2000. However, due to a colonial heritage a lot of companies operating in Australia are foreign-owned and as a result, Australia has had persistent current account deficits for over 60 years despite periods of positive net merchandise exports; given the net income outlay between Australia and the rest of the world is always negative. The current account deficit totalled AUD$44.5 billion in 2016 or 2.6% of GDP.
Inflation has typically been between 2–3% and the pre-GFC cash rate typically ranged between 5–7%, however, partly in response to the end of the mining boom the cash rate has recently been steadily falling, dropping from 4.75% in October 2011 to 1.5% in Aug 2016. The service sector of the economy, including tourism, education and financial services, constitutes 69% of GDP. Australian National University in Canberra also provides a probabilistic interest-rate-setting project for the Australian economy, which is compiled by shadow board members from the ANU academic staff.
Rich in natural resources, Australia is a major exporter of agricultural products, particularly wheat and wool, minerals such as iron ore and gold, and energy in the forms of liquified natural gas and coal. Although agriculture and natural resources constitute only 3% and 5% of GDP, respectively, they contribute substantially to Australia's export composition. Australia's largest export markets are Japan, China, South Korea, India and the US.
At the turn of the current century, Australia experienced a significant mining boom. The mining sector's contribution to overall GDP grew from around 4.5% in 1993–94, to almost 8% in 2006–07. The services sector also grew considerably, with property and business services in particular growing from 10% to 14.5% of GDP over the same period, making it the largest single component of GDP (in sectoral terms). This growth has largely been at the expense of the manufacturing sector, which in 2006–07 accounted for around 12% of GDP. A decade earlier, it was the largest sector in the economy, accounting for just over 15% of GDP.
Between 2010 and 2013, much of the economic growth in Australia was attributed to areas of the country where mining- and resource-based industries and services are mostly located. Western Australia and the Northern Territory are the only states that have economic growth. During 2012 and 2013 Australian Capital Territory, Queensland, Tasmania, South Australia, New South Wales and Victoria experiences recessions at various times. The Australian economy is characterised as a "two-speed economy". From June 2012 to March 2013 Victoria experienced a recession. In 2012 the Government of Victoria cut 10% of all jobs in the public service. The period since has seen these trends reversed with West Australia and the Northern Territory, who are heavily dependent on mining, experience significant downturns in GDP while the eastern states returned to growth, led by strong upturns in NSW and Victoria.
Taxation in Australia is levied at the federal, state, and local government levels. The federal government raises revenue from personal income taxes and business taxes. Other taxes include the goods and services tax (General Service Tax), excise and customs duties. The federal government is the main source of income for state governments. As a result of state dependence on federal taxation revenue to meet decentralised expenditure responsibilities, Australia is said to have a vertical fiscal imbalance.
Besides receipts of funds from the federal government, states and territories have their own taxes, in many cases as slightly different rates. State taxes commonly include payroll tax levied on businesses, a poker-machine tax on businesses that offer gambling services, land tax on people and businesses that own land and most significantly, stamp duty on sales of land (in every state) and other items (chattels in some states, unlisted shares in others, and even sales of contracts in some states).
The states effectively lost the ability to raise income tax during the Second World War. In 1942, Canberra invoked its Constitutional taxation power (s. 51 (ii)) and enacted the Income Tax Act and three other statutes to levy a uniform income tax across the country. These acts sought to raise the funds necessary to meet burgeoning wartime expenses and reduce the unequal tax burden between the states by replacing state income taxes with a centralised tax system. The legislation could not expressly prohibit state income taxes (s. 51(ii) does not curtail the power of states to levy taxes) but the federal government's proposal made localised income tax extremely difficult politically. The federal government offered instead compensatory grants authorised by s. 96 of the Constitution for the loss of state income (State Grants (Income Tax Reimbursement) Act 1942).
The states rejected Canberra's regime and challenged the legislation's validity in the First Uniform Tax Case (South Australia v Commonwealth) of 1942. The High Court of Australia held that each of the statutes establishing Commonwealth income tax was a valid use of the s. 51(ii) power, in which Latham CJ noted that the system did not undermine essential state functions and imposed only economic and political pressure upon them.
The Second Uniform Tax Case (Victoria v Commonwealth (1957)) reaffirmed the court's earlier decision and confirmed the power of the federal government's power to make s. 96 grants conditionally (in this case, a grant made on the condition that the recipient state does not levy income tax).
Since the Second Uniform Tax Case, a number of other political and legal decisions have centralised fiscal power with the Commonwealth. In Ha vs. New South Wales (1997), the High Court found that the Business Franchise Licences (Tobacco) Act 1987 (NSW) was invalid because it levied a customs duty, a power exercisable only by the Commonwealth (s.90). This decision effectively invalidated state taxes on cigarettes, alcohol and petrol. Similarly, the imposition of a Commonwealth goods and services tax (GST) in 2000 transferred another revenue base to the Commonwealth.
Consequently, Australia has one of the most pronounced vertical fiscal imbalances in the world: the states and territories collect just 18% of all governmental revenues but are responsible for almost 50% of the spending areas. Furthermore, the centralisation of revenue collection has allowed Canberra to force state policy in areas well beyond the scope of its constitutional powers, by using the grants power (s.96) to mandate the terms on which the states spend money in areas over which it has no power (such as spending on education, health and policing).
Local governments (called councils in Australia) have their own taxes (called rates) to enable them to provide services such as local road repairs, local planning and building management, garbage collection, street cleaning, park maintenance services, libraries, and museums. Councils also rely on state and federal funding to provide infrastructure and services such as roads, bridges, sporting facilities and buildings, aged care, maternal and child health, and childcare.
According to the Australian Bureau of Statistics (ABS) seasonally adjusted estimates, the unemployment rate decreased 0.1% to 5.5% in September 2017 while the labor force participation rate remained steady at 65.2%. The trend participation rate for 15- to 24-year-olds increased by 0.3 percentage points to 67.7 per cent while unemployment rate for this group declined by less than 0.1% to 12.7%, decreasing by 0.3% over the year. According to the Australian Bureau of statistics, in August 2017, the quarterly underemployment rate decreased by 0.2% to 8.6% while the quarterly underutilisation rate (the unemployed plus the under-employed) decreased by 0.2% to 14.1 per cent.
According to Roy Morgan Research the unemployment rate in August 2017 was 10.2%, while Australian workers who were considered either unemployed or underemployed was estimated to be 19.7% (2.565 million) in the same month. Around 4.247 million were estimated to be in part-time employment.
In 2007 228,621 Newstart unemployment allowance recipients were registered, a total that increased to 646,414 or 5.3% of the total labour force by March 2013. As of March 2017, the number of Newstart recipients stands at 746,681 or 5.8% of the labour force; a proportional increase of 0.5% in four years.
The accuracy of official unemployment figures has been brought into question in the Australian media due to discrepancies between the methods of different research bodies (Roy Morgan versus the ABS), differing definitions of the term 'unemployed' and the ABS' practice of counting under-employed people as "employed".
As of May 2017, the Australia labour force were employed in the following industries:
|Rank||Industry||No. of employees
|% of total|
|1||Health care and social assistance||1562.6||12.9%|
|4||Professional, scientific and technical services||1018.5||8.4%|
|5||Education and training||971.8||8.0%|
|7||Accommodation and food services||872.1||7.2%|
|8||Public administration and safety||812.0||6.7%|
|9||Transport, postal and warehousing||614.0||5.1%|
|10||Financial and insurance services||436.1||3.6%|
|11||Administrative and support services||411.0||3.4%|
|13||Agriculture, forestry and fishing||296.7||2.4%|
|15||Arts and recreation||215.7||1.8%|
|16||Rental, hiring and real estate services||212.8||1.8%|
|17||Information media and telecommunications||211.4||1.0%|
|Total labour force||12113.3||100.0%|
According to the Australian Graduate Survey done by Graduate Careers Australia, full-time employment for newly qualified professionals from various occupations (around four months after the completion of their qualifications) experienced some declines between 2012 and 2015. Some examples are:
|Field of Education||2012||2013||2014||2015||Change 2012–2015|
The Graduate Careers Survey 2014 explained, "However, GCA's Beyond Graduation Survey (BGS) indicates that the middle- and longer-term outlook is very positive, with the employment figures for 2010 graduates growing by 14 percentage points three years later." The Beyond Graduation Survey 2013 included 12,384 responses and the Graduate Careers Survey 2014 survey included 113,263 responses ("59.3 per cent of the almost 191,000 Australian resident graduates who were surveyed responded to the AGS.")
|6||New South Wales||4.6%|
|7||Australian Capital Territory||4.4%|
Note: All data in the table above are seasonally adjusted, except for the Northern Territory and the Australian Capital Territory, which are trend data.
In September 2017, South Australia's seasonally adjusted unemployment rate rose from 5.8% to 5.9% but the trend unemployment rate fell below 6% for the first time in four years to 5.8%.
In 2014–15 mineral extraction in Australia was valued at 212 billion Australian dollars. Of this, Coal represented 45,869 million, oil and natural gas 40,369 million, Iron ore 69,486 million, Gold ore 13,685 million, and other metals 7,903 million.
Coal is mined primarily in Queensland, New South Wales and Victoria. Fifty-four per cent of the coal mined in Australia is exported, mostly to East Asia. In 2000–01, 258.5 million tonnes of coal was mined, and 193.6 million tonnes exported. Coal provides about 85% of Australia's electricity production. In fiscal year 2008–09, 487 million tonnes of coal was mined, and 261 million tonnes exported. Australia is the world's leading coal exporter.
Australia's Argyle mine is the second-largest diamond mine in the world estimated to produce 12.6 million carats in 2014, worth over $500 million. Argyle is known for producing some of the world's most valuable pink and red diamonds.
The manufacturing industry in Australia has declined from 30% of GDP in the 1960s to 12% of GDP in 2007.
Until trade liberalisation in the mid 1980s, Australia had a large textile industry. This decline continued through the first decade of the 21st century. Since the 1980s, tariffs have steadily been reduced; in early 2010, the tariffs were reduced from 17.5 per cent to 10 per cent on clothing, and 7.5–10% to 5% for footwear and other textiles. As of 2010, most textile manufacturing, even by Australian companies, is performed in Asia.
Agriculture contributes 3% of Australia's GDP at the farm gate and when value-added processing beyond the farm is included this figure rises to 12%. Sixty per cent of farm products are exported. Irrigation is an important and widespread practice for a country where many parts receive low rainfall. Agriculture, Forestry and Fishing was the second-strongest industry from 2013 to 2015, with the number of employees growing from 295,495 in February 2013 to 325,321 in February 2015.
IT-related jobs (such as computer systems design and engineering) are defined as Professional, Scientific and Technical Services by the Department of Education, Employment and Workplace Relations of Australia. IT job creation occurs mostly in the state capital cities of Australia.
Between 1991 and 2013, 36,720 mergers and acquisitions with a total known value of US$2,040 billion with the involvement of Australian firms have been announced. In the year 2013, 1,515 transactions valued at US$78 billion had been announced which was a decrease in terms of numbers (−18%) and value (−11%) compared to 2012. The largest takeover or merger transaction involving Australian companies was the 2007 takeover of the Coles Group by Wesfarmers, totalling A$22 billion.
In the financial year 2014/15, tourism represented 3.0% of Australia's GDP contributing A$47.5 billion to the national economy. Domestic tourism is a significant part of the tourism industry, representing 73% of the total direct tourism GDP.
In calendar year 2015, there were 7.4 million visitor arrivals. Tourism employed 580,800 people in Australia in 2014–15, 5% of the workforce. About 43.7% of persons employed in tourism were part-time. Tourism also contributed 8.0% of Australia's total export earnings in 2010–11.
In 2011–12, Australia was ranked 30th out of 179 countries in accordance to press freedom. Media is a strong industry in Australia, with Fairfax Media and News Corporation representing two of the country's largest media companies.
School attendance is compulsory in Australia, from the age of 5 up until approximately 16 (although it varies between each state and territory). Australia also has an adult literacy rate that was estimated to be 99% in 2003.
In the Programme for International Student Assessment, Australia regularly scores among the top five of thirty major developed countries (member countries of the Organisation for Economic Co-operation and Development). In 2018 there were 525,054 international students in Australia, comprising a market of 32,2 billion A$.
The Australian economy is dependent on imported crude oil and petroleum products, the economy's petroleum import dependency is around 80%—crude oil + petroleum products.
In the second half of the 20th century, Australian trade shifted away from Europe and North America to Japan and other East Asian markets. Regional franchising businesses, now a $128 billion sector, have been operating co-branded sites overseas for years with new investors coming from Western Australia and Queensland.
In the late 19th century, Australia's economic strength relative to the rest of the world was reflected in its GDP. In 1870, Australia had the highest GDP per capita in the world due to economic growth fuelled by its natural resources. However, as Australia's population grew rapidly over the 20th century, its GDP per capita dropped relative to countries such as the US and Norway. However, the Australian economy has been performing nominally better than other economies of the OECD and has supported economic growth for over 20 consecutive years. According to the Reserve Bank of Australia, Australian per capita GDP growth is higher than that of New Zealand, US, Canada and The Netherlands. The past performance of the Australian economy has been heavily influenced by US, Japanese and Chinese economic growth.
Australia's net external debt exceeded $1 trillion in April 2017 as a result of Australia's structural current account deficits. Although these deficits have narrowed over the last decade due to an increase in net merchandise trade, this effect has been partly offset by the return of Australian government debt; net federal debt was estimated at $326.0 billion in the 2016–17 federal budget of which 60% is owed to foreigners. The entirety of the debt has been accumulated through ten straight budget deficits as Australia had negative net government debt (i.e. The Australian government had net positive bond holdings) a decade earlier in the 2006–07 fiscal year.
There is substantial export to China of iron ore, wool and other raw materials, and over 120,000 Chinese students study in Australian schools and universities. China is the largest purchaser of Australian debt. In 2009, offers were made by state-owned Chinese companies to invest $22 billion in Australia's resource extraction industry.
The Signing of the China-Australia Free-Trade Agreement, signed November 2014, has the potential to drastically increase Chinese Investments as agriculture and services become more lenient.
Australia's special investor visa program introduced in 2012 encouraged Chinese investment. The visa program fast-tracks visas and eases the residency requirement for a permanent visa for those ready to invest over five million Australian dollars into state government bonds, specific infrastructure and property investments. Wealthy Chinese interested in retirement houses, top schools and cleaner air, began looking to Australia after Canada started scaling back its investment visa program in 2012 and eliminated its main investor visa program in 2014. In early 2014 it was reported that the Australia's special investor visa was granted to 65 mostly Chinese millionaires who brought over $440 million into the country. By 2017, almost 90% of the more than 1,300 foreigners who used Australia's special investor visa program were from China. Australia also has an investor visa program with a required investment of one million Australian dollars but with more restrictions and a lengthier period of time to get a permanent visa.
In 2017, it was reported that Australia is the third-most popular destination for Chinese to invest wealth offshore, with a 7% increase in Chinese private wealth flowing into Australia while interest in the top two investment destinations, Hong Kong and the United States, fell by 18% and 3%, respectively. In 2017 there were 1.6 million high-net-worth Chinese (with at least 10 million Chinese yuan to invest) and 24 per cent of the 3,000 wealthy Chinese surveyed had private investments in Australia. Migration was one of the top three reasons for Chinese investment offshore.
In 2018, in the Lowy Institute poll there had a sharp rise in the proportion of the Australian population who say the Australian government is "allowing too much investment from China".
This number rose from 56 per cent in 2014 to 72 per cent in 2018.
|FTA (Free Trade Agreement) effective
|| FTA (Free Trade Agreement) negotiation
In trade terms, the Australian economy has had persistently large current account deficits (CADs) for more than 50 years. One of the factors that undermines balance of payments is Australia's export base, making it highly vulnerable to the volatility in the prices of commodity goods. In addition, due to a colonial heritage a lot of companies operating in Australia are foreign-owned and, as a result, Australia's net income outlay between it and the rest of the world is always negative; this results in persistent current account deficits even when there is a positive export .
Dependent upon commodities, the Australian government endeavoured to redevelop the Australian manufacturing sector. This initiative, also known as microeconomic reform, helped Australian manufacturing to grow from 10.1% in 1983–1984 to 17.8% in 2003–2004.
There are other factors that have contributed to the extremely high current account deficit in Australia such as lack of international competitiveness.
However, as Australia's CAD is almost entirely generated by the private sector, as outlined in Professor John Pitchford's 'Consenting Adults Thesis' in the early 1990s, there is an argument that the CAD is not a significant issue. Historically, Australia has relied on overseas capital to fill the gap between domestic savings and investment, and many of these investment opportunities could not have been pursued if Australia did not have access to foreign savings. This suggests that Australia's apparently low savings level and CAD are not necessarily a significant problem. As long as the investment that is being funded by overseas capital inflow generates sufficient returns to pay for the servicing costs in the future, the increase in foreign liabilities can be viewed as sustainable in the longer term.
According to the 2011 Credit Suisse Global Wealth report, Australia's wealth per adult had quadrupled over the past decade, and its total wealth was US$6.4 trillion. In the report Australia was the second-wealthiest country in the world behind Switzerland based on average wealth per adult, and had the highest median wealth in the world (US$222,000, nearly four times the amount of each US adult) and a proportion of people with wealth above US$100,000 that was eight times the world average. This was attributed to a resilient Australian dollar, property ownership levels and a strong labour market. Compared to the rest of the world, very few Australians had a net worth of less than US$1,000, which was attributed to relatively low credit card and student loan debt. In 2013, Australia was identified by the Credit Suisse as retaining its 2012 position as the nation with the second-highest average wealth per adult (US$403,000); however, the nation's poverty rate was also reported to have increased from 10.2% in 2000–01 to 11.8% at the time of the 2013 report on global wealth.
Despite the economic slowdown, in the 2014 Credit Suisse Global Wealth Report, Australia continued to have the second-highest average wealth per adult (US$430,800) and the highest median wealth (US$225,400), with a total wealth of $7.2 trillion. The average level of real assets (US$319,700) was the second-highest in the world after Norway and 60% of gross household assets. The report explained that this partly reflects a large endowment of land and natural resources relative to population, and also high urban real estate prices. Only 6% of Australians had a net worth below US$10,000, compared to 29% in the USA and 70% for the world as a whole. The average debt was 20% of gross assets. The proportion of people with wealth above US$100,000 was the highest in the world (eight times the world average). Australia had 3.8% (1,783,000 people) of the top 1% of global wealth holders while having 0.4% of the world's adult population. The wealth share by Australia's top decile was 51.1% in 2000, 50.7% in 2007, and 51.1% in 2014. In 2016, Australia continued to be the second-wealthiest nation in terms of wealth per adult.
In 2017, Australia was the world's top destination for millionaires, beating the United States for the second consecutive year. An estimated 11,000 millionaires moved to Australia in 2016, compared with the 10,000 who moved to the United States. Australia was especially attractive to Chinese millionaires due to its relative proximity, cleaner environment, political and economic stability, and investor visa programs. Also, the primary reason for millionaires leaving China is top schools abroad that will give their children a better education and career connections.
All in all over 43,150 deals have been completed national, inbound or outbound Australia. This cumulates to an overall value of US$2,554 billion. There was a strong upward trend between 1989 and 2007. In this peak year almost 3,100 deals took place, which is almost 60% more than in 2017, the current low. Australian companies are particularly investing in the fields of metals and minerals (15% of all deals from Australia into foreign countries). Runner-up is the oil and gas industry with only 6.4%.
Here is a list of the top 10 deals with participation of Australian companies as the acquirer or target company:
|Date||Acquirer name||Acquirer industry||Acquirer nation||Target name||Target industry||Target country||Value in US$bn|
|12 May 2008||Westpac Banking Corp||Banks||Australia||St George Bank Ltd||Banks||Australia||17,932.98|
|2 July 2007||Wesfarmers Ltd||Food & beverage retailing||Australia||Coles Group Ltd||Food & beverage retailing||Australia||15,287.79|
|16 October 2006||Kemble Water Ltd||Other Financials||Australia||Thames Water PLC||Water and waste management||United Kingdom||14,888.80|
|27 October 2006||Cemex SAB de CV||Construction materials||Mexico||Rinker Group Ltd||Construction materials||Australia||14,247.73|
|20 October 2016||Investor Group||Other Financials||Australia||Ausgrid Pty Ltd||Power||Australia||12,499.92|
|19 March 2001||BHP Ltd||Metals & mining||Australia||Billiton PLC||Metals & mining||United Kingdom||11,510.99|
|21 June 2011||SABMiller Beverage Investments||Other Financials||Australia||Foster's Group Ltd||Food and beverage||Australia||10,792.76|
|6 December 1996||Investors||Other Financials||Australia||Telstra Corp Ltd||Telecommunications services||Australia||9,976.59|
|2 November 2010||Shareholders||Other Financials||Australia||Westfield Group-Assets(54)||Non-residential||Australia||9,482.42|
The Liberal/National Coalition and its forebears (right wing) and the Labor Party (left wing) have formed every Australian Government since Federation, and continue to be the major forces in the predominantly two-party system under which Australia operates.
In 2017 ACOSS released a new report revealing that poverty is growing in Australia, with an estimated 2.9 million of people, or 13.3% of all people, living below the internationally accepted poverty line it also estimated that there are 731,000 children in poverty, and 17.5% of children under the age of 15 are in poverty.
There were 105,237 people experiencing homelessness in Australia on census night in 2011. This equated to 1 in 200 Australians, and represented an increase of 17% from the 2006 census, with the rate of homelessness increasing from 45 per 10,000 to 49 per 10,000.
The number of homeless people in Australia jumped by more than 14,000—or 14 per cent—in the five years to 2016, according to census data. The Australian Bureau of Statistics (ABS) said 116,000 people were homeless on census night in 2016, representing 50 homeless people per 10,000.
The Australian Made and Australian Grown trade mark logos signify products whose ingredients or production mostly originate from Australia. This programme was established in 1986 with a logo created by Ken Cato and is conducted by the Australian Made Campaign Limited, a not-for-profit public foundation created by the Australian Chamber of Commerce and Industry and various Australian business chambers.The logo is accompanied by one of the following phrases, either Australian Grown, Australian Made or Product of Australia.Australian dollar
The Australian dollar (sign: $; code: AUD) is the currency of Australia (including its external territories Christmas Island, Cocos (Keeling) Islands, and Norfolk Island), and of three independent Pacific Island states, specifically Kiribati, Nauru, and Tuvalu. It was introduced on 14 February 1966 when the pre-decimal Australian pound, with subunits of shillings and pence, was replaced by the new decimal currency, the Australian dollar.
Within Australia, it is almost always abbreviated with the dollar sign ($), with A$ or AU$ sometimes used to distinguish it from other dollar-denominated currencies. It is subdivided into 100 cents.
In 2016, the Australian dollar was the fifth most traded currency in world foreign exchange markets, accounting for 6.9% of the world's daily share (down from 8.6% in 2013) behind the United States dollar, the European Union's euro, the Japanese yen and the United Kingdom's pound sterling. The Australian dollar is popular with currency traders, because of the comparatively high interest rates in Australia, the relative freedom of the foreign exchange market from government intervention, the general stability of Australia's economy and political system, and the prevailing view that the Australian dollar offers diversification benefits in a portfolio containing the major world currencies, especially because of its greater exposure to Asian economies and the commodities cycle.The Australian dollar was legal tender of Papua New Guinea until 1 January 1976, when the Papua New Guinean kina became the sole legal tender there.Australian property market
The Australian property market comprises the trade of land and its permanent fixtures located within Australia. The average Australian property price grew 0.5% per year from 1890 to 1990 after inflation, however rose from 1990 to 2017 at a faster rate and may be showing signs of a contracting economic bubble. House prices in Australia receive considerable attention from the media and the Reserve Bank and some commentators have argued that there is an Australian property bubble.
The residential housing market has seen drastic changes in prices in the past few decades. The property prices are soaring in major cities like Sydney, Melbourne, Adelaide, Perth, Brisbane and Hobart. The median house price in Sydney peaked to $780,000 in 2016. However, with stricter credit policy and reduced interest from foreign investors in residential property, prices have started falling in all the major cities. When compared with the soaring prices of 2017, the housing prices fell by 11.1% in Sydney and 7.2% in Melbourne in 2018.Australian settlement
The Australian settlement is a set of nation-building policies adopted in Australia at the beginning of the 20th century. Those policies profoundly influenced the way Australia developed over the coming decades and were only dismantled towards the end of the century. They were: the "White Australia" Policy of immigration restriction; protective tariffs on imports of manufactured goods; a system of compulsory conciliation and arbitration for industrial disputes; and early social welfare policies. The term "settlement" refers to the way this constellation of policies emerged as a compromise between major interests in Australian society at that time, namely workers and employers.Australia–United States Free Trade Agreement
The Australia – United States Free Trade Agreement (AUSFTA) is a preferential trade agreement between Australia and the United States modelled on the North American Free Trade Agreement (NAFTA). The AUSFTA was signed on 18 May 2004 and came into effect on 1 January 2005.Closer Economic Relations
The Australia–New Zealand Closer Economic Relations Trade Agreement, commonly known as Closer Economic Relations (CER), is a free trade agreement between the governments of New Zealand and Australia. It came into force on 1 January 1983, but the actual treaty was not signed until 28 March 1983 by the Deputy Prime Minister of Australia and Minister for Trade, Lionel Bowen and the New Zealand High Commissioner to Australia, Laurie Francis in Canberra, Australia.Committee for Economic Development of Australia
The Committee for Economic Development of Australia (CEDA) is a bipartisan, non-profit, national, independent, member-based organisation providing thought leadership and policy perspectives on the economic and social issues affecting Australia.
Its expressed aim is to "promote national economic development in a sustainable and socially balanced way." Sydney Morning Herald economics editor Ross Gittins has described CEDA as seeking to "inform the public debate without lobbying". It is financed by around 700 members drawn from business, universities, governments and community groups, and by a program of conferences and other events.Economy of Oceania
The economy of Oceania comprises more than 14 separate countries and their associated economies.
On a total scale the region has approximately 34,700,201 inhabitants who are spread among 30,000 islands in the South Pacific bordered between Asia and the Americas. This region has a diverse mix of economies from the highly developed and globally competitive financial market of Australia to the much less developed economies that belong to many of its island neighbours. New Zealand is the only other developed country in the region, although the economy of Australia is by far the largest and most dominant economy in the region and one of the largest in the world.Fiscal imbalance in Australia
The fiscal imbalance in Australia is the disparity between the revenue generation ability of the three levels of governments in Australia relative to their spending obligations; but in Australia the term is commonly used to refer more specifically to the vertical fiscal imbalance, the discrepancy between the federal government's extensive capacity to raise revenue and the responsibility of the States to provide most public services, such as physical infrastructure, health care, education etc., despite having only limited capacity to raise their own revenue. In Australia, vertical fiscal imbalance is addressed by the transfer of funds as grants from the federal government to the states and territories.Household, Income and Labour Dynamics in Australia Survey
The Household, Income and Labour Dynamics in Australia (HILDA) survey is an Australian household-based panel study which began in 2001. It has been used for examining issues such as the incidence of persistent poverty; assets and income in the transition to retirement; the correlates and impact of changes in physical and mental health; and an international comparison of wealth and happiness. The survey is widely used by Australian and international researchers in the fields of economics, social science and social policy and by the Australian Government. The HILDA survey is managed by a small team from the Melbourne Institute of Applied Economic and Social Research at the University of Melbourne and the national fieldwork is carried out by ACNielsen and Roy Morgan Research. The survey is funded by the Australian Government through the Department of Social Services.
HILDA has the following key features:
It collects information about economic and subjective well-being, labour market dynamics and family dynamics.
Special questionnaire modules are included each wave and have covered topics such as wealth, retirement and fertility intentions.
The wave 1 panel consisted of 7,682 households and 19,914 individuals. In wave 11 this was topped up with an additional 2,153 households and 5,477 individuals
Interviews are conducted annually with all adult members of each household. Children are interviewed once they turn 15.
The panel members are followed over time.
Funding has been guaranteed for 18 waves, and the survey is expected to continue beyond wave 18.
Data releases occur at the start of December. The release in December 2018 was for data collected from 2001 (wave 1) to 2017 (wave 17).HILDA data, when weighted, describe the Australian population (excluding those not living in households). The datasets (PSPP/SPSS, SAS and Stata files) are available for legitimate research purposes and application can be made from the HILDA website. The data are confidentialised by suppression of geographic and other identifying information. A bibliography of published research, the survey methodology, the questionnaires and a user manual are available from the HILDA website.
HILDA data are integrated into the Cross-National Equivalent File (CNEF) which contains population panel data from Australia, Canada, Germany, Great Britain, Korea, Switzerland, Russia and the United States.List of Australian states and territories by gross state product
This is the most recent list of Australian states and territories by gross state product (GSP) and GSP per capita. Also included are the GSP and population growth tables as well as a comparison table showing the surplus/deficit between state final demand (SFD) and GSP for the same financial year. All the data was taken from the Australian Bureau of Statistics website.List of Australian states by Human Development Index
Below is a list of the Australian states and territories by Human Development Index as of 2017, which is a comparative measure of life expectancy, literacy, education, standard of living and overall well-being of the citizens in each states. All Australian states have a very high (greater than 0.800) HDI.List of Australians by net worth
A list of the richest people in Australia is compiled by both Forbes Asia magazine and by The Australian Financial Review. The lists assess the net worth of individuals and are published on an annual basis in February and May respectively.Median household income in Australia and New Zealand
Median household income is commonly used to measure the relative prosperity of populations in different geographical locations. It divides households into two equal segments with the first half of households earning less than the median household income and the other half earning more.
New Zealand and Australia are gradually being economically integrated through a process known as “Closer Economic Relations (CER)”. Their citizens are free to travel, live and work in either country. Information about their relative median household incomes is of interest, especially for those considering migration.
The latest release shows that the median gross household income in 2013–14 was $80,704, and the average of all households was $107,276.Mineral fields of Western Australia
Mining in Western Australia is administered in terms of the administrative divisions of the:-
Gold or Mineral Field
Goldfield DistrictThere have also been various hierarchies of State Mining Engineer Inspectorate areas, as well as Mining Registrars Offices and areas.Official cash rate
The official cash rate (OCR) is the term used in Australia and New Zealand for the bank rate and is the rate of interest which the homogeneous central bank charges on overnight loans to commercial banks. This allows the Reserve Bank of Australia and the Reserve Bank of New Zealand to adjust the interest rates that apply in each country's economy. The OCR cannot be changed by transactions between financial institutions as this does not change the supply of money, only its location. Only transfers between the central bank and an institution can affect the OCR.
As banks settle all inter-bank transfers overnight, the central bank can regulate the rate paid for cash by the sale or buy back of bonds and other government issued securities (these are known as domestic market operations). As the sale or purchase of bonds affects the supply of money, then the interest rate will change to reflect its availability. This system indirectly influences the term structure of interest rates in the whole economy. Changes to the official cash rate generally affect the rates on housing and other loans within a matter of days or weeks. Under the Australian system the Reserve Bank of Australia issues its dealing intentions at the start of each day, and banks and other financial institutions will act prior to the actual rate being achieved.
The rate is set by the central banks regularly, usually every month in Australia and every six weeks in New Zealand and forms one of the main tools to manage monetary policy.Productivity Commission
The Productivity Commission is the Australian Government's principal review and advisory body on microeconomic policy, regulation and a range of other social and environmental issues.
The Productivity Commission was created as an independent authority by the Productivity Commission Act 1998, an Act of the Australian Parliament.
The Commission operates within the Treasury portfolio and its core function involves responding to references from the Treasurer, which can request a commissioned study or a public inquiry. References to the Commission stipulate the length and terms of the project and may cover any sector of the Australian economy; address a particular industry or cut across industry boundaries; and involve wider social or environmental issues.
Most projects are specified for nine or twelve-month duration, although some may be six or fifteen months. Both studies and inquiries accept submissions from members of the public and involve the public release of a draft and final report, although inquiries are additionally required (under the Act) to undertake formal public consultations.
In addition, the Commission acts as the secretariat to the intergovernmental Review of Government Service Provision, and produces regular reports on Overcoming Indigenous Disadvantage and Indigenous Expenditure that contribute to a better understanding of the effectiveness of government services provided to Indigenous Australians.
The Commission can also self-initiate research on industry and productivity issues, and operates as the Australian Government's competitive neutrality complaints mechanism.
Productivity Commission reports often form the basis of government policy. However, the Commission does not administer government programs or exercise executive power and governments are not required to act on its recommendations; although in practice more recommendations have been accepted than rejected.Superannuation in Australia
Superannuation in Australia are the arrangements put in place by the Government of Australia to encourage people in Australia to accumulate funds to provide them with an income stream when they retire. Superannuation in Australia is partly compulsory, and is further encouraged by tax benefits. The government has set minimum standards for contributions by employees as well as for the management of superannuation funds. It is compulsory for employers to make superannuation contributions for their employees on top of the employees' wages and salaries. The employer contribution rate has been 9.5% since 1 July 2014, and as of 2015, was planned to increase gradually from 2021 to 12% in 2025. People are also encouraged to supplement compulsory superannuation contributions with voluntary contributions, including diverting their wages or salary income into superannuation contributions under so-called salary sacrifice arrangements.
An avoidable issue with Australia’s superannuation system is employees failing to consolidate multiple accounts, thus being charged multiple account fees. Of Australia’s 15 million superannuation fund members, 40% have multiple accounts, which collectively costs them $2.6 billion in additional fees each year. The federal budget estimates put the number of unnecessary duplicate accounts at 10 million. Plans are in place to facilitate consolidation of these accounts. An individual can withdraw funds out of a superannuation fund when the person meets one of the conditions of release, such as retirement, terminal medical condition, or permanent incapacity, contained in Schedule 1 of the Superannuation Industry (Supervision) Regulations 1994.As of 30 June 2018, Australians have $2.7 trillion in superannuation assets, making Australia the 4th largest holder of pension fund assets in the world.Urban ecosystem
Urban ecosystems are the cities, towns, and urban strips constructed by humans.
This is the growth in the urban population and the supporting built infrastructure has affected both urban environments and also on areas which surround urban areas. These include semi or 'peri-urban' environments that fringe cities as well as agricultural and natural landscapes. Semi environments can also be called peri-urban.
Nowadays scientists are developing ways to measure and understand the effects of urbanization on human and environmental health.By considering urban areas as part of a broader social-ecological system, scientists can investigate how urban landscapes function and how they affect other landscapes with which they interact. In this context, urban environments are affected by their surrounding environment but also affect that environment. Knowing this may provide clues as to which alternative development options will lead to the best overall environmental outcome.
CSIRO CSE's urban ecosystem research is focused on:
Understanding how cities work as integrated social-ecological systems
Developing sustainable approaches to development of city fringe areas that reduce negative impact on surrounding environments
Developing approaches to urban design that provide for health and opportunity for citizens.
Economy of Australia
|Banking and Finance|