AU - Australia's Economy (Lesson)

Australia's Economy

Introduction 

Australia has one of the wealthiest, productive, and thriving economies in the world. Australia is a major exporter of gold, diamonds, zinc, bauxite, oil, and coal. Because of Australia's wealth in natural and mineral resources, Australians have a very high standard of living.

 

Australia's Economy

Australia's total wealth is around 6.5 trillion dollars, and its GDP is the 12th largest in the world. Australia is the 19th largest importer and exporter of goods, products, mineral and energy resources.

Australia's service industry makes-up almost 70% of Australia's economy. Manufacturing, including the production of transportation equipment, clothing, non-perishable foods, and chemicals contribute to Australia's growing economy. Other service industries such as banking and tourism are also very important to the economy.

Australia's agriculture industry makes-up approximately 19% of the economy. In Australia, much of the land is very dry. However, in many areas irrigation has made growing crops possible. A portion of eastern Australia is very fertile. Cattle ranching on large farms called stations is common in the Outback. Irrigation in dry regions of the country allow farmers to grow crops such as sugarcane, cotton, vegetables, fruits, and a variety of different types of grains.

Australia's mining industry makes-up approximately 10% of the economy. Australia is rich in energy resources such as natural gas, oil, and coal. In addition, minerals such as gold, diamonds, zinc, nickel, iron ore, and bauxite are mined and sold to other countries for large profits. Australia is one of the largest producers of bauxite in the world. One-third of all of Australia's natural resources are exported to China and Japan for a profit.

 

Restrictions on Trade

Australia has a free market economy. Its economy is considered one of the freest in the world. Consumers and producers set market prices based on the principles of supply and demand. Voluntary exchange, or the act of buyers and sellers freely and willingly engaging in market transactions, are clearly apparent in all aspects of Australia's economy.

Australia's economy is dependent on importing and exporting goods to other countries. Australia's government has placed very few restrictions on trade. Australia's natural trade barrier is the Pacific Ocean. Therefore, all exports have to be shipped overseas. Tariffs, or taxes on imports and exports are low or removed from overseas transactions.

One of the major factors that contributes to a growing economy is the investment in human capital. Australia invests heavily in its citizens. Children must attend school from the ages of six to eighteen. As a result, the literacy rate is nearly 100%. The workforce is well trained and well educated, and the state health care system is well organized and available to all. As a result, Australia has one of the highest standards of living in the world.

 

Review

Review some of the terms from this lesson in the activity below.

 

 

 

We analyzed the impact of geography on people and their economic decisions related to the production, consumption, and distribution of goods and resources.

What are 3 facts you can recall from this lesson?

 

 

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