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Up until the current world-wide economic downturn, Australia had recorded 17 consecutive years of economic growth – averaging 3.3% per year. This was one of the most stable and productive periods of Australia’s modern history, and places Australia in the top echelon of developed countries in terms of sustained rates of growth. Furthermore, Australia ranks first in the Asia-Pacific region for labour, agriculture and industrial productivity per person employed, according to the IMD World Competitiveness Yearbook. The 2006 OECD Economic Survey noted that living standards in Australia surpass those of all Group of Eight countries except the United States. Once again until relatively recentlly a sustained period of government budget surpluses had enabled the Australian Government and many state level governments to retire large amounts of government debt. Net government debt was eliminated in 2005 – 06 making Australia a net creditor nation. In May 2008, the Australian Government committed to a budget surplus equivalent to 1.8% of GDP – some $21.7 billion. In the 2009/10 buget announced by the Federal Treasury it was projected that the economy would shrink overall and that unemployment would rise to 8.5 per cent by mid 2011 (from a figure of 5.5 per cent), still a relatively low figure compared to other developed nations. As with these other nations, Australia will have a budget deficit in 2009/10 as more capital resources are used to stimulate the economy. However Australia is till in the fortunate position of being able to increase pension payments, introduce a new maternity leave scheme and provide significant tax breaks for small business. As if to confirm the current "age of uncertainty" the Australian Treasury Secretary announced on 25 June 2009 that the abovementioned budget forecasts may have been too pessimistic, predicting a possible GDP growth in 2008/09 to be somewhat stronger.
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Australia’s independent central bank, the Reserve Bank of Australia (RBA) is responsible for monetary policy, in particular to keep consumer price inflation between 2 and 3%, on average, over business cycles. Australia has a sound and practical structure of financial regulations and institutions that provides certainty for business and is open to investment without undue delay. There is a strong, transparent corporate governance system along with business oriented corporate regulation and insolvency regimes. Australia is also has low barriers to trade and investment. Since a wave of micro-economic reform in the 1990s, competition policy has been a key ingredient of the economy’s continuing success, including in key areas such as transport, telecommunications, electricity and gas. According to the World Bank, a new business can be established in Australia within 2 days compared to an OECD average of 20 days. The goods and services tax (GST) – Australia’s value-added tax – is levied at 10% and applies to almost all goods and services transactions across the economy. There is no stamp duty on share transactions and a flat corporate tax rate of 30%. Australia is a major regional financial centre and a vital cog in the global financial system. The Australian Stock Exchange and the Sydney Futures Exchange merged in 2006 to form the world’s 8th largest listed exchange – the Australian Securities Exchange (ASX). As at 30 June 2007, that ASX had 2090 listed companies with a domestic market capitalisation of $1.63 trillion. Every day, some 150 000 equities and 400 000 futures and options are traded. Australia has one of the highest percentages of shareholders in the world. More than 50% of the adult population own shares in publicly-listed companies. Safe, stable and prosperous, Australia is an increasingly attractive hub for global and regional business operations. |
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