Pete Wargent blogspot

CEO AllenWargent Property Buyers, & WargentAdvisory (institutional). 6 x finance author.

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Wednesday, 23 November 2016

Who exports Australia's services? (Sydney, and Melbourne)

Thanks to Sydney and Melbourne

Exports of Australian services have been growing faster than goods exports, growing by 10 per cent in 2014-15 and 9 per cent the year before that. 

But which states account for the bulk of services exports?

In a nutshell, all but two thirds of services are accounted for by New South Wales (41.3 per cent) and Victoria (24.4 per cent).

Not only do the two most populous states account for most of the services exports, the growth rates are by a huge margin fastest in these two states. 

Not to put too fine a point on it, Australia's economy would be toast without its two largest cities, Sydney and Melbourne.

And with the economies of Sydney and Melbourne holding the economy aloft in 2016, the figures this year will be even more skewed towards the big two.

We'd be stuffed without them, the state accounts showed as much. 

As for what services exports comprise, the below pie chart reveals all, with travel for business, leisure, and education featuring very prominently (in fact, travel accounts for 89 per cent of Tasmania's services exports, for example).  

Although China is the biggest consumer of Australian services exports, services trade is relatively speaking quite well spread across Hong Kong, Taiwan, New Zealand, United States, Canada, United Kingdom, Switzerland, Singapore, India, Japan, Korea, Malaysia, and a number of other Asian countries. 

As such, exports are growing in a reasonably diversified and sustainable fashion, particularly into Asia.

Contrast this with goods exports, where until relatively recently just two countries have been accounting for around half of our exports. 

Sydney and Melbourne - the twin heartbeats of Australian services exports.

And thank goodness they are!