Colin Brinsden, AAP Economics and Business Correspondent
(Australian Associated Press)
The relative success of containing the coronavirus among Australia’s regional neighbours and a strong economic rebound in China will assist the nation’s recovery from the first recession in nearly 30 years.
Treasurer Josh Frydenberg says China, South Korea, Vietnam and Taiwan, together with Australia and New Zealand, have been effective in limiting the transmission of COVID-19.
Some countries in the region also remain largely COVID-free, including many of the Pacific islands.
At the same time, the Chinese economy has also rebounded strongly.
“Indeed, China’s rebound in real GDP in the June quarter was equal to the total size of Belgium’s economy in 2019,” Mr Frydenberg told The Australian Strategic Forum 2020 on Wednesday.
“The sharp contraction in GDP that China saw in the March quarter was completely recovered in the June quarter of this year.”
This recovery is expected to continue in 2021 with the Australian Treasury forecasting China to grow by a further eight per cent.
“These two factors – our relative success on the health front and China’s strong recovery – will further enhance our region’s prospects as we move into recovery,” Mr Frydenberg said.
“And Australia will benefit from this. A stronger region will help boost our own recovery from COVID-19.”
But he said the immediate recovery goes beyond just a China story.
It is also tied to the continued, longer term rise of India, Indonesia and Southeast Asia.
“These growth engines of the future — with relatively young and growing populations — will continue to reshape the region and create important new opportunities for Australia,” he said.
“That is why the Morrison government is deepening our economic partnerships, to take advantage of these new opportunities.”
Last weekend, Australia signed the Regional Comprehensive Economic Partnership Agreement between Australia and 14 other Indo-Pacific countries, representing 30 per cent of global economic growth.
“This builds on the government’s ongoing success in securing trade agreements and, importantly, it signifies that our region remains committed to the principles of open trade,” Mr Frydenberg said.
“This will ensure that Australia is well placed to reap the full benefits of a strong and growing Indo-Pacific.”