In 2010, Australia exported US$48.6 billion of goods to China, more than nine times the amount a decade ago. The mining industry was particularly lucrative - iron ore exports accounted for more than half of Australia’s exports to China.
Mining and farming are expected to drive Australia’s economic growth in the near future. According to the Australian Bureau of Agricultural and Resource Economics and Sciences, mine production will rise by 10.2 percent in 2010-2011; while farm production is likely to rise by 8.9 percent.
However much of this growth is also dependent on sustained demand for Australian commodities from countries in the Asia-Pacific region. As such, the Australian government is focused on raising Australia's economic productivity to ensure the sustainability of growth, while continuing to manage the symbiotic, but sometimes tense, economic relationship with China.
Australia is the 13th largest economy in the world according to nominal GDP (current prices) and the 17th largest according to GDP (PPP). In 2010, Australia’s GDP (PPP) was US$882.344 billion – a 3.94 percent increase from 2009. Australia’s nominal GDP (current prices, US dollars) growth during the same period was even more amazing – GDP (current prices, US dollars) grew from US$994.25 billion in 2009 to US$1.219 trillion, a 22.68 percent increase.
Spurred by robust business and consumer confidence, Australia’s economy is expected to grow even quicker in the next five years. 2011 to 2015 should see Australia’s GDP (PPP) grow by 4.81 to 5.09 percent annually. By the end of 2015, Australia’s GDP (PPP) is expected to be US$1.122 trillion.
Likewise, Australia’s GDP (PPP) per capita is expected to experience healthy growth. In 2010, Australia’s GDP (PPP) per capita was the tenth highest in the world – growing from US$38,633.17 in 2009 to US$39,692.06. In 2011, Australia’s GDP (PPP) per capita will increase by 3.52 percent to US$41,089.17. The following four years should see fairly consistent growth in Australia’s GDP (PPP) per capita, resulting in a GDP (PPP) per capita of US$47,445.58 by the end of 2015.
Australia had a population of 22.23 million and a labour force of 11.152 million in 2010. In the same year, Australia’s unemployment rate was 5.192 percent – which is 0.22 percent more than the world’s average of 4.97 percent.
According to Australian Treasurer and Deputy Prime Minister, Wayne Swan, the May 10th budget is expected to create 500,000 jobs in two years and is aimed at bringing unemployment rates down to 4.5 percent.
Mr. Swan acknowledged that unemployment was unacceptably high in certain parts of Australia and the government was looking to create new incentives for more jobs.
Whether this budget will prove successful in bringing down unemployment rates remains to be seen. According to the unemployment rate forecast provided by the IMF, unemployment is only expected to see a marginal decrease to 5.025 percent by the end of 2012. After which, the unemployment rate from 2013 to 2015 should remain constant at 4.8 percent.
According to the Australian Bureau of Statistics, the increasing costs of food and fuel caused Australia’s inflation rate to be higher than expected in the first quarter of 2011. In 2010, Australia’s inflation rate (average consumer price change) saw better recovery from the financial crisis than most other advanced economies, returning from 1.82 percent in 2009 to 2.962 percent. Significantly, this was only marginally lower than the average inflation rate (average consumer price change) before the financial crisis from 1999 to 2008 (2.987 percent).
By the end of 2011, Australia’s inflation rate (average consumer price change) is expected to rise to 3.038 percent. However from 2013 onwards, Australia’s inflation rate (average consumer price change) is expected to fall below 3 percent once again and be between 2.65 percent and 2.498 percent from 2013 to 2015.
Australia’s current account balance has remained in negative figures for more than fifty years – caused by a narrow export base as well as high levels of capital goods from overseas. In 2010, Australia had one of the top ten highest current account balance deficit in the world at US$29.928 billion. The Australian current account balance deficit is expected to rise even further in the next five years, reaching US$89.106 billion in 2015.
Read more about Australia's economy, including industry information and trade statistics on EconomyWatch below.
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