Flourishing economy of Australia
Australia is the 13th largest economy on the planet, according to the International Monetary Fund, Australia’s economy will grow to become the world’s 13th largest in 2022. The nominal GDP of Australia is expected to be approximately A$2.1 trillion (US$1.7 trillion). Although Australia has only 0.3% of the world’s population, it accounts for 1.6% of worldwide GDP.
In 2021, Australia was still feeling the impact of the COVID-19 epidemic. In June 2021, an outbreak of the Delta variety drove large cities, regional and rural areas, particularly in the densely populated south-east, to go into lockdown. The Australian government gave economic assistance to businesses and people once again. Vaccination initiatives in states and territories have been increased up. As vaccination rates rose, restrictions were relaxed in October 2021.
Australia’s GDP growth rate was predicted to return to 3.5% in 2021, after falling to 2.4% in 2020, according to the International Monetary Fund. The GDP is expected to expand to 4.1% in 2022, according to the IMF, as the economy and international borders reopen.
Australia’s financial situation is stable. By the end of 2022, Australia’s public sector debt will reach 43% of GDP. This is significantly below the 89% average expected for advanced economies, according to current projections.
While slowing the spread of COVID-19, all governments have attempted to minimize economic disruption. Only a few countries have managed to do both. In reaction to local epidemics, Australian states and territories blocked their internal borders. The Australian government issued a 20% GDP economic package to help our economy. The Australian public, for the most part, followed the strict, ever-changing lockdown restrictions. In comparison to most other countries, Australia had a low death rate and a modest GDP impact by October 2021.
Following the closure of Australia’s borders, the Australian government devised a stimulus package worth 20% of GDP. 3 In global terms, Australia was sandwiched between the United States and the European Union. The federal and state governments are expected to provide roughly A$20 billion in direct economic support to firms and people in the September quarter of 2021 during the most recent lockdowns. It kept Australians employed and businesses afloat.
In practically all economies, the COVID-19 epidemic has resulted in a rapid increase in public debt. Australia started 2020 with a very low public debt burden (less than 30% of GDP), which will continue to be low by global standards. The International Monetary Fund anticipated that Australia’s net debt will be 43% of GDP in 2022 in its October 2021 ‘Fiscal Monitor’ report. This is considerably below the average projection of 89% for advanced countries and 102% for G7 economies.
Asia’s share of global GDP has consistently risen from 20% in 1981 to about 45% in 2026, according to projections. The Australian economy will prosper as a result. The majority of Australia’s major export partners are in Northeast and Southeast Asia. Australian companies have preferential access to these fast-growing areas thanks to a network of 15 free trade agreements. Australia is ideally positioned to increase its exports of resources, energy, agriculture, education, and tourism services to Asia’s growing middle-class customers, which are estimated to reach 2.2 billion by 2032.
A varied range of competitive industries underpins Australia’s resiliency. The country’s services and products industries contributed for around 81% and 19% of real gross value added (GVA) in 2020-21 (financial year ending June). The mining sector contributed 10.6% of Australia’s GDP, followed by financial services (9.3%), home ownership (8.9%), and healthcare and social assistance (8.9%) (8.2%). Professional, scientific, and technical services, as well as education and information technology, account for 15% of overall economic output.
In the three decades leading up to June 2021, the Australian services industry increased at a rate of 3.3% per year, outperforming growth in the products sector. Over the previous 30 years, the information, media, and telecommunications industry has grown at the quickest rate, with a compound annual growth rate of 5.0%, followed by professional, scientific, and technical services (4.8%) and healthcare and social assistance (4.5%).