Australian Economic & GDP Growth

This article provides an analysis of the growth of Australian economy and GDP over the last five years under various industries such as agriculture, mining, tourism, and service industries. It also discusses the policies and strategies implemented by the Australian government to enhance economic growth.

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AUSTRALIAN ECONOMIC & GDP GROWTH
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The following Gross Domestic Product analysis and economic growth is shown below
over the last five years under various industries in Australia. Australian economy is among the
fastest growing economy globally compared to other nations (Burdack, 2014, p. 133). By the
year 2016 and over the last five years, the growth rate of Australian economy continued to show
an improvement annually (Perth, 2012, p. 214). The increase and development in Australian
industries was propelled by a number of reforms. The reforms included modifications in taxation
and government, labor market, and having the worst broadband speed and capacity in the
developed world which is termed as a boost or role model in the digital disruption era.
The following context regards to the economic growth of Australia.
Economy refers to the system by which goods and services are produced, bought and sold
in a region (Junankar, 2016, p. 54). Australian economy comprises of several industries such as
agriculture, forestry, fishing, mining, media, tourism, telecommunication, transportation and
service industries. The Australian economy is characterized as a ‘two-speed economy’. Between
the year 2010 and 2013, much of the Australian economic growth was accredited to regions of
the nation where mining industries were mostly located. In addition, during 2012 and 2013,
Australian Capital Territory comprised of Tasmania, New South Wales, South Australia,
Queensland and Victoria. All the regions experienced a recession at different times.
Despite of problems such as high taxation, unnecessary government involvement,
increased domestic debt levels and huge administrations shortages, Australian economy has
increased dramatically (James, 2016, p. 56). In the year of 2016, agriculture industry contributed
about 2.61 percent of Australian Gross Domestic Product. Nevertheless, the Australian economy
advanced 0.4 percent in December last year, 2017, which was seen to be less than the market
consensus of the previous quarter which was slightly high as it was seen at 0.6 percent (Murphy,

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et al., 2010). Economy analyst staged that this was the weakest progression rate since a
retrenchment in the year before, 2016, which saw an upwardly reviewed 0.7 percent progress in
the previous section.
The tourism sector, in the financial year 2010-2011, it represented a 2.5 percent of the
Australian gross domestic product. Local tourism is an important part of the tourism industry.
The 2010-11 financial year saw a massive number of tourist touring the Australian tourist
attraction sites hence contributing to the national gross domestic product. Also, it is in this
financial year where there were increased job opportunities. Many of the Australian residents
were employed by the sector, hence contributing to the Australian economy and also towards the
gross domestic product.
Australia’s per-capita GDP is considered to be much higher than that of other nations
such as Canada, United Kingdom and France in terms of purchasing power parity (PPP). The
stress on exporting goods and services rather than manufacturing the same fortified a significant
improvement in trade. On the other hand, many of the Australian operating companies are
foreign-owned (Dalal-Clayton, 2014, p. 212). This is due to a colonial heritage of these
companies. Therefore, as a result of these foreign owned companies, Australia has had recurring
current account arrears over a long period of time. The persistence current account shortages
occur despite phases of positive net commodities exports. However, given the net income
expense between the rest of the world and Australia, the results are always negative. In 2016, the
deficit amounted to a 2.6 percent of the gross domestic product (Sherraden, et al., 2015, p. 179).
Also, inflation has usually been between two to three percent. Nevertheless, somewhat in
response to the end of the mining flourishing, the cash rate has lately been continuously falling.

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A drop of 4.75 percent in the month of October 2011 was experienced to a significant 1.5 percent
in August 2016
Ever since the mid-2000s there has existed development in both the worth of cropping and
livestock trades. Cropping exports varies with periodic conditions that affect manufacture hence
wheat remains the main crop traded in value terms. Also in recent years tree nuts and fruits
exportation has developed strongly. Chickpea exports, reasonably small crop in Australia, its
exportation is estimated to double in worth in terms in 2015 to 2016 (Perth, 2012, p. 32). An
instance of how revenue growth and better trade sincerity in the Asian section have contributed
considerably to growth in trade is Australian’s cherry industry. Market entrance was enhanced
for cherries to the republic of Korea subsequent a reduction in assessments rates in January 2015.
Market entrance to Thailand for a variety of fruits including cherries improved in December
2015 (James, 2016, p. 76). Whereas a relatively small business, cherry trade improved to 48
million USD in 2014-2015, thus up from 13 million USD in 2010-2011.
Australia is among the major exporter of agricultural commodities since it is rich in
natural resources. Particularly, exported agricultural products comprises of wool and wheat. The
other exported commodities are minerals such as gold, iron ore and energy. Usually, the energy
is exported in the state of liquefied natural gas and coal. Though natural resources and
agricultural respectively constitute only five percent and three percent of the gross domestic
product. Therefore, agriculture and natural resources contribute significantly to Australia’s
export configuration. Besides, Australia’s biggest export market comprises of nations such as
China, Japan, US, South Korea and India (Garnaut & Song , 2012, p. 178). Recently, Australia
has incurred a significant mining flourish. The growth of mining sector greatly contributes to the

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national gross domestic product. In addition, the service sector comprising of property and
business services, over the same period, grew considerably.
In the service sector, jobs related to IT such as engineering and computer system design
are usually defined as professional, technical and scientific services. The Australian department
of employment, education and workplace are the ones responsible in defining the IT related jobs
(Saee, 2011, p. 77). The finance sector holds the Australian ‘big four banks’ which comprises of
Commonwealth bank, National Australia bank, Westpac and New Zealand banking group. In the
year 2012, the four banking systems were considered to be among the world’s safest banks to
invest in. Recently, a significant number of acquisition and mergers related to the Australian
firms have been announced.
Manufacturing sector has recently declined in the contribution of the national gross
domestic product. For instance, four companies among the various mass car production in
Australia have ceased the production activities. Some of these companies are Mitsubishi
followed by Ford in the year 2016 (Hunt, 2010, p. 54). Despite Ford having two branches in
Victoria and Geelong, they were both forced to cease their mass car production activities. In
2017, other two companies known as Holden and Toyota ceased their manufacturing activities
too.
Australia is the leading coal exporter in the world. Coal, a mineral mined under the
mining industry sector, significantly contributes to the gross domestic product of the nation. Coal
is primarily mined in Wales, Queensland and Victoria (Ozcevik, et al., 2015, p. 23). Usually,
Australian coal is exported to East Asia who are major coal consumers. Besides, coal production
contributes about 85 percent of the electricity used in Australia. In addition, Argyle mine in
Australia is the second biggest diamond mine cite in the world. Australian Argyle mine is

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famous in the production of red and pink diamonds which are some of the world’s most valuable
diamonds.
The following information regards to the Gross Domestic Product (GDP) of Australia.
GDP refers to the monetary measure of the market worth of all final goods and services
produced in a period of time (Dept, 2018, p. 122). Therefore, Gross Domestic Product (GDP) is
the most sufficient way for measuring a country’s economy. Australian comprises of several
segments. For instance, mining industry increased by 1.3 percent. The increase was due to a
drive by the iron ore mining. The other mineral that contributed to the rise in the mining industry
include coal mining. However, there was a decrease in the extraction of gas and oil by a 1.8
percent (Vierow , 2010, p. 275). Besides, there was a fall experienced in the export of goods and
services by a margin of one point eight percent. Rural and non-rural exports of goods and
services reduced dramatically. However, there was an increase in the importation of goods. The
rise was due to an increase in consumption of intermediate and imported goods. Nevertheless,
the country experience a drop in the importation of services. Also, due to non-dwelling
construction, gross fixed resources formation contracted as private investment, dropped.
Public investment improved by 2.9 percent. The rise in public investment was due to a
drive by local and state general. Due to increased demand for houses, this factor led to an
expansion of construction industry. The massive migration of immigrants to Australia led to an
increase in media, information and telecommunication. The witnessed increase was denoted by a
2.9 percent and the main drive behind this rise was as an impact of telecommunication,
information and media services (Brunner & Thorburn, 2012, p. 135). In the second quarter of
2014, insurance and financial services increased by 0.1 percent. Also, social and healthcare
assistance progressed by 1.9 percent at the same time as financial and insurance sector.

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Despite the increase in financial sector, there was a drop of 2.1 percent in the
agriculture, fishing and forestry sector. The fall in this department was experienced in three
conservative quarters. Also, manufacturing sector dropped by one percent with mixed outcomes
across the five sub-categories (Swith, 2011, p. 71). In addition, water, electricity, gas and waste
services declined. The decline of 0.8 percent was due to a fall in water supply and waste services.
The Australian economy throughout the year to the fourth quarter grew by 2.4 percent. The
growth was slower than the one in the previous quarter and slightly below the expectations
which were set at a 2.5 percent.
The following context regards the Australian government policy towards economic & GDP
growth over the last five years;
Under the current Australian government, there have being some measure and policies
which govern the economy and the country’s GDP. One of the policies is the broader policy
agenda. In this policy, the Australian administration highlights the means in which it is
redirecting the government expenditure. The spending is usually towards investments which are
considered to enhance employees’ participation and productivity.
The other policy used is the fiscal strategy. Medium-term fiscal plan is to attain
budget excesses on average above the course of the cost-effective cycle. Fiscal policy is the
process by which an administration adjust its expenditure levels and duty rates collection to
observer and influence a country’s economy. This is met through the administration’s changes in
revenue system and expenditure. Fiscal policy is linked to monetary strategy through which is
managed by the central bank to impacts a country’s money supply and interest charges. Fiscal
policy has three stances which include; expansionary fiscal strategy involving administration’s
expenditure above the revenues by more than the previous intensions, normally carry out during

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recessions (Wu, 2013). The second stance is neutral fiscal strategy which is normally carried out
when an economy is neither boom nor a downturn. The third stance is Contractionary fiscal
strategy which occurs when the administrations deficit expenditure is lower than normal.
The fiscal plan emphasizes the commitment to modest discipline and summaries how
the administration will set medium-term fiscal plan while sanctioning flexibility and preventing
fatigue. The policy is underpinned by the following fundamentals; payments-to gross domestic
product ratio decreasing, stabilizing and then dropping net liability over time, maintaining a
sturdy fiscal principle by controlling spending to reduce the administration’s economic stake
over time, and also in strengthening the administration’s balance sheet (Perth, 2012, p. 90). The
Australian administration has a budget repair approach which is aimed to deliver maintainable
budget surpluses structuring towards gross domestic product. The approach arrays out that the
new expenditure measure shall exceed the offset by decreases in expenditure somewhere else
and also to set a clear trail back to the sources which is supported by choices that are established
over time.
The Australian Administration’s fiscal strategy intents to guide the financial plan back to
a sustainable source at a responsible pace. This year financial plan focuses on implementing the
administration’s economic plan for employment opportunities and enhancing the growth of the
country’s economy (The story of Australia. Episode 2: grown in Australia, 2016). The initiative
tax plot for the government of Australia increases domestic and household earnings by providing
inducements for businesses to make investments and also in return pay their duty to the current
government.
The following information regards to Australian industries and reasons for their growth.

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The Australian industries such as agriculture, forestry, fishing, mining, media, service
and energy have always been seen to register a contentious increase in improvement. Therefore,
the following are the reasons behind their improvement (McLean, 2013, p. 45). . The growth is
facilitated by the increased demand for goods and services hence creating an already market. The
Australian government agreement with other states such as the US, on trade, have facilitated
growth of industries through elimination of trade restrictions. For instance, in exportation of
commodities, has being highly facilitated by the absence of trade restrictions. Due to the public
investment which is rising strongly. Investments creates a wide pool of both producers and
consumers hence, the higher the rate of public investment, the higher the rate of economic
growth. Another reason behind the growth is the drag from falling mining investment is nearly
over (North & McKay, 2011, p. 64). Five years ago, mining outlay peaked at approximately
seven percent of the gross domestic product. The other reason behind the success story is that the
non-mining investment is now increasing. Non-mining investments such as agriculture, tourism
and forestry sector are improving on daily basis.
Conclusion
Australia, over the past five years has been improving in its economy. The economy has
been flourishing due to the massive contribution of the different sectors such as transportation,
agriculture and mining towards the Gross Domestic Product of the country (GDP). Despite the
on and off season, the Australian economy is said to have developed.

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