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Like any rich world economy, Australia’s economy is diversified. It has agriculture and mining but it also manufactures things like machinery. Australia’s economy has done better than many other world economies in the recent economic downturn. The reason for this is that Australia exports significant amounts of commodities to China and China’s economy did not really fall during the global crisis.
In terms of trade, Australia is very fortunate in its geography. It has huge deposits of various minerals, perhaps the most important of which are coal and iron ore. It also produces a great deal of wool and wheat. It is also fortunate because it is close to Asia. The bulk of Australia’s exports go to Asia. China is the main recipient of these exports. This has been very good for Australia in recent years as China’s economy has grown more rapidly than any other large economy. This has increased demand for Australian commodities and allowed Australia to experience economic growth even when times are hard for most of the rest of the developed world.
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