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The shape of things to come:
long run forces affecting the
Australian economy
Presentation to Queensland University of Technology
Business Leaders’ Forum
Ken Henry
Thursday 22 October 2009
0
0
-2
-2
-4
-4
-6
-6
-8
-8
-10
-10
Slovenia
Finland
Taiwan
Ireland
Japan
Denmark
Sweden
Italy
Germany
UK
Slovakia
Luxembourg
Netherlands
Czech Rep.
Norway
Austria
Spain
US
Hong Kong
Belgium
Portugal
Singapore
Canada
Iceland
Malta
France
Korea
New Zealand
Switzerland
Cyprus
Israel
Greece
Australia
Chart 1: GDP growth in advanced
economies
2 Per cent
Source: Ecowin.
Per cent 2
Chart 2: Participation Rate
66
Per cent
Per cent
66
64
64
62
62
60
60
58
1979-80
1989-90
1999-2000
Source: ABS Cat No. 6202.0 and Treasury.
2009-10
2019-20
2029-30
2039-40
58
2049-50
Chart 3: Per capita GDP convergence
100
% US GDP per capita ($PPP)
% US GDP per capita ($PPP)
80
100
80
Japan (1955-2008)
NIEs (1967-2008)
60
60
40
40
20
20
ASEAN-4 (1973-2008)
China (1980-2008)
India (1982-2008)
0
0
4
8
12
16
20
24
28
32
Source: The Conference Board Total Economy Database, IMF and Treasury.
0
36
40
44
48
52
Chart 4: Terms of Trade
140
Index (2006-07=100)
Index (2006-07=100)
1950-51
(f)
Sep 2008
1924-25
120
140
120
100
100
Mar 1974
80
80
60
60
40
1901
1912
1923
1934
1945
1956
1967
1978
1989
2000
40
2011
Note: From September quarter 1959, quarterly data from ABS Catalogue Number 5302.0; prior to September quarter 1959, MW Butlin
(1977) ‘A Preliminary Annual Database 1900-01 to 1973-74’, RBA Discussion Paper 7701.
Source: ABS Catalogue Number 5302.0, RBA and Treasury.
Chart 5: Australia’s Current Account
Balance 1901-2009
2 Per cent
Per cent 2
Current account balance
0
0
-2
-2
Century average
-4
-4
Past three decades average
-6
-6
1900s
1910s
1920s
1930s
1940s
Source: ABS Catalogue Numbers 5206.0, 5302.0 and RBA.
1950s
1960s
1970s
1980s
1990s
2000s
Chart 6: Australia’s national saving
24
Per cent of GDP
Per cent of GDP
24
22
22
20
20
18
18
16
16
14
14
12
12
1990
1992
1994
Australia
1996
1998
United States
Note: Gross National Savings.
Source: IMF World Economic Outlook, ABS Cat No. 5206.0.
2000
2002
2004
Major Advanced Economies
2006
2008
Chart 7: Australia’s National
Investment
25 Per cent of GDP
Per cent of GDP 25
Total Investment
20
20
15
15
10
10
5
5
0
0
United
Kingdom
United
States
Germany
France
Canada
Japan
Australia
OECD
Average
Source: IMF World Economic Outlook, OECD Economic Outlook, ABS Cat No. 5206.0. Data refers to average of 2000s.
The shape of things to come:
long run forces affecting the
Australian economy
Presentation to Queensland University of Technology
Business Leaders’ Forum
Ken Henry
Thursday 22 October 2009