It Is The Fifth Consecutive Year of Trade Surpluses for Australia

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Australia has achieved another historic milestone, recording its fifth consecutive year of trade surpluses. This significant achievement is primarily attributed to improved relations between Australia and China, its largest trading partner, as well as Beijing’s rapid reopening of its economy.

“We expect the trade surplus to remain healthy, supported by the earlier reopening of China’s economy and still high commodity prices, albeit off the peak,” said Belinda Allen, an economist at the Commonwealth Bank of Australia.

The impressive figures reveal that the windfall came in at A$12.2 billion ($8.4 billion) in December, close to economists’ estimates for a A$12.5 billion surplus.

Overall exports declined by 1%, a much smaller drop than the typical seasonal fall, pointing towards better-than-expected performance from the manufacturing, mining and services sectors.

On the other hand, imports advanced 1% for the month, with solid performances from categories such as consumer goods and capital investment goods driving the growth during this period.

Based on these data points, economists are reckoning that trade likely added 1-1.7 percentage points to Australia’s gross domestic product (GDP) in the final three months of 2022.

“That should help offset most of the slowdown in consumption growth and ensure another decent rise in overall output,” said Marcel Thieliant, senior economist at Capital Economics.

Analysts believe that Australia will remain in a good position if it can maintain good relationships with its top trading partners like China while fostering a positive environment for domestic business investments and market sectors such as agriculture and tourism within the country itself.

There appears to be a light at the end of the tunnel, and Australia is set to enjoy another successful year despite ongoing headwinds from home and abroad. With more positive news emerging almost daily from both sides of the Tasman Sea and in Asia Pacific regions, Australia will be optimistic about what lies ahead this year and beyond.

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