The Structure and Pattern of Australia's Trade Essay

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Introduction The purpose of this report is to analyse the structure and pattern of Australia's trade. The report uses trade statistics from 1999-2000 to 2003-04 and theoretical perspectives to help explain the pattern of trade. The focus will begin with the balance of payments in relation to exports and imports, then move on to the determinants of the terms of trade, and finally, an analysis of why Australia's trade pattern is as it is. Note: All figures as shown in Australian dollars (AUD). Balance of Payments The Australian balance of payments is a systematic record of economic transactions between the residents of Australia and residents of other countries. (ABS 5363.0, 2005) Exports Australia's total exports,…show more content…
The most valuable export commodities for 2003-04 were coal, non-monetary gold, iron ore and crude petroleum products. Table 3 shows their dollar value and percentage of total exports. Table 3: Most valuable export commodities 2003-04 Export commodity Dollar value (b$) Percentage of total exports (%) Coal 10.8 10 Non-monetary gold 5.7 5 Iron ore 5.2 5 Crude petroleum products 4.6 4 (Source: Australian Bureau of Statistics 1301.0, 2005) In 1999, Japan was the largest importer of Australian exports and continued to be in 2004. China has increased steadily over the five years, ranked 5th in 1999 rising to 2nd in 2004. This increase is a reflection of China's rapid economic growth; 9.1 percent in 2004 (CIA - Factbook, 2005). Another important trend in Australia's export market is the rise in rank of India from 15th in 1999, to 7th in 2004. India, like China has also experienced high economic growth, around 6.1 percent annually, and will continue to be an increasingly important export destination for Australia (RBA Box A, 2004). Table 4 shows the eight largest export partners and their ranking over a five-year period. Table 4. Export partner ranking 1999-2000 to 2003-2004 (b$) Country 99-00 Rank 00-01 Rank 01-02 Rank 02-03 Rank 03-04 Rank Japan 18,822 1 23,479 1 22,796 1 21,727 1 19,798 1 China 4,966 5 6,846 5 8,793 4 8,803 4 9,912 2 USA 9,602 2 11,654 2 12,008 2 10,365 2 9,453 3 Korea (Sth) 7,615 3 9,209 3
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