- This article was last edited in 2011. Some of its information may be outdated.
Australia is a developed country with a capitalist economy. It has a very small population compared to other Western countries like the USA and the UK but despite this it is in the top 15 countries by Gross Domestic Product (a measure of wealth of a nation).
Exports and Imports
The economy of Australia is very different to that of other developed countries. For example, there is a nearly equal amount of exports compared to imports, which is generally not seen in Western Economies. This is mainly due to the fact that Australia is vast and rich in natural resources, and exports items such as coal, gold, meat, wool, iron ore, wheat and machinery. Australia has maintained trade links with various countries throughout history, but more recently with the economic boom of China and India exports (especially natural resources) have experienced a spike in growth. In 2008, China was 2nd while India was 4th on the Australian exports list, and China was 1st on Australia’s Imports list.
Australia’s strong trade market is generally attributed to its 2 decades of continuous growth at above average rates. This is really remarkable after considering the fact that there have been 2 recessions in that time frame (the early 2000s recession and the current recession). Australia is the only western nation that isn’t in recession currently due to the Global Economic crisis. Australia’s GDP reached over $1 trillion in the mid - late 2000’s and this has been the result of the booming trade in some states like Western Australia where the exports account for twice as much value than their imports.
Businesses are attracted to Australia for a number of factors which include:
- The fact that Australia is the fastest place in the world in which to start a business (according to the World Bank)
- Strategic location in the fast-growing Asia–Pacific region
- Economic and political stability
- And a good and stable financial and legal system.
The unemployment rate in Australia is currently 5.5% and despite the global financial crisis, the unemployment rate had never gone over 6%, instead peaking at at only 5.8% in October 2009. This is unlike the US where the unemployment rate went over 10% despite massive stimulus.