Foreign investment is integral to the Australian economy. It is an open, well-regulated economy with a highly skilled workforce. Furthermore, Australia has been considered one of the world's major 'immigration nations' for decades.
Australia is internationally renowned as a secure economy with a AAA Credit rating, attracting global investors seeking investments with reputable credit risk. The key underlying economic drivers supporting stability are unemployment, government bond, and cash rates.
Through the global pandemic, economic prosperity remained stable, as seen from a multitude of economic indicators. The seasonally-adjusted unemployment rate declined from a peak of 7.5% in July 2020 to 4.6% as of September 2021, underlining a resilient and growing labor market. Anchoring investor sentiment is a low 10-year government bond rate with a risk-free rate of return of 1.85% as of November 2021. Market sentiment is driven by the Reserve Bank of Australia's (RBA) historically low cash rate at 0.10%, remaining until at least 2021 (dependent upon inflation and wage growth).
Investing in Australia key points:
- Population Growth: The nation has historically shown strong population growth. The current population of 25.7 million people has grown on average 1.4% p.a. since the 17.1 million recorded in 1990 and 72% of the population is living in major cities. It is projected the population will reach 29.1 million by 2032.
- Direct/Indirect Investment: There are opportunities to invest directly or through various visa schemes. The Significant Investor Stream Visa supports people who invest at least $5 million AUD dependent on meeting certain requirements and maintaining investment activity in Australia.
- Transparent Markets: Capital cities such as Sydney and Melbourne rank as the world's most transparent real estate markets. It supports international investors seeking risk diversification and facilitates efficient, competitive and attractive real estate markets.
- Strong Banking Sector: The Australian banking sector is strong and the largest contributor to the national economy, worth $140 billion AUD to GDP a year. It employs around 450,000 people and is a core sector of the economy into the future. Enhanced financial stability ensures compliance and regulatory frameworks are enforced.
- Growing Equities Market: The equities market averages 6.6% p.a. in US dollar real returns since the beginning of the 20th century until the end of 2020. The growing equities market experienced a significant rebound post-March 2020 (COVID-19).
- Quality of Life: Australia was ranked by the United Nations as the second-best country in the world for quality of life measured against three basic dimensions; Life expectancy at birth, mean and expected years of schooling, and living standards.
Australia as immigration destination
The Australian lifestyle presents a desirable opportunity for the international community: high quality of life, low population levels and low pollution with fresh air. More than 80% of the Australian population lives within the coastal zone, surrounded by beaches and national parks.
Australia presents prosperous job opportunities for skilled workers and has a multi-cultural population.
Additionally, world-leading educational facilities and accessible public transport networks, underpinned by strong residential construction and global demand for natural resources establish Australia as a prominent immigration destination.