Export Trend
To better understand the trend in merchandise exports in Australia during better times and in economic downturns, the following line chart plots the annual merchandise exports in the previous 30 years, highlighting certain key economic events.
It is evident from the graph that Australia’s merchandise exports have seen significant growth. The graph begins in 1988 and include all the years for which ABS has maintained a comprehensive record on Australia’s Merchandise exports. In that time, Australia’s exports have increased from AU$42 million to AU$363 million annually, increasing by more than 8-folds. During both the 2000 and 2008 financial crises, the export ceases growing for a year, before rapidly rebounding in the following years.
It may be speculated that the short-term pause in growth is attributable to the decrease in demand from overseas economies that demand less goods that are exported from Australia. Another possible disruption is the supply chain instabilities as suppliers and customers may have become insolvent because of the economic fallout.
Regardless the reason for the initial downturn, the rapid recovery is driven in no small part by the high volume of exports from Australia. The subsequent sections will provide further discussion on how certain categories of goods being exported have changed over time.
Top 10 Export Destinations
Australia’s top 10 export destinations are illustrated in the following bar graph, showing the annual merchandise exports during 2020.
The graph clearly illustrates that China, with 40% of total merchandise exports valued at AU$146 billion, is the overwhelming export destination for Australian Goods. Once again it is important that these export figures do not include service exports. Nevertheless, China’s export volume dwarfs the next country with Japan at AU$43 billion (12% of total). In fact, the value of export is equivalent to the next eight largest markets combined.
The high proportion of exports that are destined for China may be an area of concern, as the economic success is directly tied to the continued prosperity of China. The strong exports have some origins in China’s economic growth, which has seen its GDP increase at double digit rates until 2010, this growth has slowed to 6-7% in the past 10 years. Given the declining growth seen in the Chinese economy, it would seem only prudent that Australia diversifies its export markets to alleviate the risk from the currently highly concentrated export landscape.
Export Destination Worldwide
The following choropleth indicates the percentage of total exports for each nation in 2020.
Once more, it is evident that China is the predominant export market for Australian exports. When considered in conjunction with the bar chart, it is evident that the besides the USA and UK, the remaining export destinations in the top 10 are in the Indo-Pacific region. Looking deeper, the top 3 nations; China, Japan and South Korea are concentrated in the East Asia subcontinent, consisting of 58.7% of all the exports from Australia. This comes contrary to the common perception that North America or Europe are the largest export markets (again, this only considers goods and not service exports). Thus, it can be inferred that these regional neighbours in Asia are likely driving Australia’s current exports, and further growth.
Key Findings
- Australian merchandise exports have seen substantial and consistent growth in the past 30 years.
- China is overwhelmingly the export destination for Australia consisting 40.3% of all exports.
- Regional nations in East Asia form a significant majority of all exports from Australia.