Australia is being encouraged to diversify its exports away from China
(Kitco News) - It is no secret that Australia is having its export problems with China at the moment and a leading body has suggested maybe the nation needs to diversify the nation's risk. Since Australia decided to let some nationals from Hong Kong seek asylum in the nation the spat stepped up."
A Joint Standing Committee on Trade and Investment Growth report, Pivot: Diversifying Australia's Trade and Investment Profile noted "Australia has capitalised on its natural advantages to grow its exports, particularly in the resources and agricultural sectors," the report stated.
It added, "While this has been highly profitable, a low level of economic diversity in Australia's exports may create longer-term challenges for economic growth."
Minerals Council of Australia (MCA) chief executive officer Tania Constable also agreed with the repot and thinks the nation could be reliant on the customer base of the mining industry.
Constable said "Broadening our customer base will improve the security of demand for Australia's industries, just as security of supply is vital for countries with which Australia trades,".
She added "In this context, it is important to note that Australia's resources sector is not overexposed to China. For example, when iron ore is excluded from our trading profile, China only represents 15 per cent of Australian resource exports.".
Constable then encouraged the industry to look toward new markets in countries part of the Association of Southeast Asian Nations (ASEAN).
"The MCA has been a long-term advocate for free trade and trade expansion and diversification through trade and investment agreements which can help build and maintain strong and enduring government to government connections," Constable said.
The Australian Bureau of Statistics revealed that Australia's iron ore exports increased by 20 per cent in 2020 to reach $116 billion, while gold exports rose by 12 per cent to $27 billion.