By Betty Lam (Head of Investments and Partnerships)
Australia has remained largely immune to the second and third waves that are devastating other continents. As a first mover nation, there are now, more reasons to invest in Australia and Australian businesses, some of which we will explore further.
1. Strong GDP Growth
Australia boasts an annual GDP growth rate of 3.2% over the past 28 years, up until 2020. This rate outperforms all economies, especially considering Australia weathered the GFC unlike any other economy. An advantage of being a first-mover nation following the pandemic has seen Australia’s economy track a consistent and relatively unincumbered path to recovery as evidenced in March 2021; where Australian unemployment numbers registered at 5.8%, beating analyst expectations and marking the lowest on record since April 2020.
2. Stable Geo-Political Environment and Pro-Business Attitude
The Quality of the Australian governance is ranked as one of the best in the world. (*Worldwide governance indicators, 2019). Supported by strong financial system, fiscal position and low government debt entering into 2020, allowing Government to well support economic recovery pathways. Minimal infection rates and strong governance have had a substantial impact for Australia’s economic and social recovery. The country is considered to have one of the strongest and most efficient regulatory environments in both government and security of financial systems.
Australia also outperforms in three pro-business metrics, making the country highly investible from an expansion and exposure standpoint.
- One of the most business-friendly nations
- Ranked the highest digital standard of living
- Low cost of living compared to Asian neighbors
3. Strong and Sophisticated Financial Systems
Australia is often regarded as one of the most highly regulated financial systems globally. The security and Covid-affected unemployment has been primarily concentrated to younger people, specifically travel, hospitality and education industries. March 2021 unemployment numbers registered at 5.8%, beating analyst expectations and the lowest on record since April 2020.
4. Not all properties and suburbs are created equal.
Suburbs which have high rental density or are located near universities account for a bulk of rental price drop and increase in listings.
5. First mover advantage
Despite international second and third wave, Australia has remained largely immune. Australia is considered one of the first-mover nations and as a result, parts of the economy are opened and thriving. Home marker, mining, technology and self-care have seen a surge in demand. Mining focused areas in Western Australia and Queensland have seen consistent property growth since March 2020. Australians as a nation, are generally a law-abiding country. Australians benefit from a high level of compliance to government guidelines and restrictions when compared to other nations. This has been one of the major contributing factors to the success of Covid containment and minimization.
Article References
(WEF Global Competitiveness Report 2019 Ranking)
(*Worldwide governance indicators, 2019)
(*Surfshark (2019) Digital Quality of Life 2019)
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