Australia, much like other countries around the world, was severely affected by the effects of the Covid-19 pandemic. Before 2020, the nation has experienced moderate rates of growth and development, accentuated by slow trade rates and a general calm period. However, with the regulatory measures brought upon by the pandemic, the economy has suffered significant damage. Many people have lost their jobs, driving unemployment up to unforeseen heights. Despite the challenges brought by the virus, Australia has been able to recover and restore its values to the pre-pandemic measurements, even exceeding them in some areas. In particular, the GDP in 2021 has finally been on the rise compared to the previous two years, and unemployment has hit a new low when contrasted against the most recent measurements.
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This work will focus on discussing and expanding on some of the considerations necessary for a business to start its operation in a new market environment. Due to a variety of variables and influences, it is necessary to talk about both the presence of a particular economy and its past. The current report will focus on the economic conditions in Australia, particularly the changes brought upon by the ongoing covid-19 pandemic. The recent emergence of the coronavirus has had tremendous effects on the global environment, particularly on the economy of both developing and leading nations of the world. It is important to consider how such unique challenges are addressed by a country, as it can give further insight into its economic strengths and weaknesses. For a growing and expanding business looking to set up in a new location, such discussions are most crucial. First, the conditions of the country before 2020 will be examined; then, the report will transition to reviewing the state of the economy during the last two years. As a result of this work, the capability of the Australian economy to handle stress will be evaluated. The report is useful to businesses looking to expand into the Australian market as a way to measure the profitability of this venture.
Economy before the Pandemic
First, Australia’s state of economic development before the pandemic will be accessed. Looking at the information of the past allows one to adequately understand the conditions the country is in today and draw correct conclusions from the changes that have occurred over the two years. Depending on the strength of Australia’s pre-pandemic market, additionally, one could forecast its ability to withstand financial turmoil in the face of an unprecedented event. For a business emerging in a new market, understanding the kinds of average conditions the company would be subject to is crucial, even as it is contrasted with the relative uncertainty of the current years. According to the information released by official agencies over the 2019 period, the country experienced a period of slow growth and development starting in 2018 (“Economic outlook: Statement on monetary policy,” 2019). It is noted that the major trade partners working with the country have been decreasing their output, leading to slower than anticipated growth during this period (“Economic outlook: Statement on monetary policy,” 2019). However, when compared to the general trends of GDP changes and growth in the economy, this period was still signified by positive improvement for the nation. The annual growth of GDP for Australia is -0.3% for 2019, but the general trend for the future is expected to be positive (“Australia GDP – gross domestic Product 2019”, 2020). Regarding unemployment, the statistics in 2019 were stable. For this period, the unemployment rates in Australia stayed at 5%, a generally decreased number compared to previous years. Economic forecasting expected the statistic to remain at this value for a long period of time while gradually decreasing after 2021. Officials note that the GDP value is connected to both unemployment and rates of inflation, with the former being reduced by an increase in GDP. As evaluations say that the future GDP will improve, the unemployment in Australia is also expected to decrease.
Impact of the Pandemic on the Economy
In continuation of this discussion, the country’s capacity to handle the pandemic from an economic point of view should also be discussed. As it stands, a nation’s response to the crisis and unpredictable circumstances is something any business should take into account. If a new market is too unreliable or continuously works to undermine its businesses in times of crisis, it is highly possible that a company should avoid setting up there. For this reason, considering Australia’s response to the pandemic is crucial. Additionally, Covid-19 is a contingency every major company has had to account for, in large part thanks to the sheer magnitude of its impact. It would be unwise to enter a new market without understanding its history with the virus and the experiences of other business owners during it. Generally, it can be said that Australia has managed to handle the coming of the pandemic rather well. The country has adopted the necessary measures to address the outbreak, and its economy was strong enough to withstand the impact as well. Addressing the changes in GDP, the current statistics show that Australia’s values have actually increased compared to pre-pandemic values, meaning that the country has had the ability to maintain its economy in the face of the crisis (“International economic comparisons after a year of the pandemic,” n.d.). The confidence of business owners and consumers was supported by the ability of the government to contain the virus and mitigate its effects. The government has also frequently released monetary stimulus and supported its business, a practice that has helped the population handle more rough parts of the pandemic. The unemployment rates for the country have seen a large spike during the start of 2020, which was connected with the start of the pandemic (“Australia unemployment RATE1978-2021 Data: 2022-2023 Forecast: Calendar”, n.d.). However, similar to other considerations concerning regulatory measures used by the nation, unemployment has been resolved coming into 2021. Notably, the most recent percentage for unemployment is lower than in both 2018 and 2019, meaning the general economic conditions of the population have improved. With the revitalization of the economy, thanks to the overall containment of Covid-19, the blooming market of Australia has become very attractive to new businesses. Companies and organizations have the opportunity to set up in the country and participate in consumer resurgence after a period of conservative spending.
Australia GDP – gross domestic Product 2019 (2020). countryeconomy.com.
Australia unemployment RATE1978-2021 Data: 2022-2023 Forecast: Calendar. Australia Unemployment Rate | 1978-2021 Data | 2022-2023 Forecast | Calendar. (n.d.).
Cockburn, G. (2021). Australians are saving more during the pandemic, research shows. The Canberra Times.
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International economic comparisons after a year of the pandemic. Australian Bureau of Statistics. (n.d.).
Reserve Bank of Australia. (2019). Economic outlook: Statement on monetary policy – May 2019. Reserve Bank of Australia.