What recession mate?

When you think of Australia you’re most likely to associate it with the Sydney Opera
House, vast areas of desert, a few tinies (cans of beer), a barbie (BBQ not doll), and of
course Ricky Ponting – the captain of the Australian cricket team. However, 2009 has
been a year of incredible resilience for its economy. As the rest of the industrialized
world hemorrhaged into a period of recession, which threatened depression, the
Australian economy moved in the other direction and actually recorded an increase in
GDP.

The end of 2008 (December quarter GDP) saw a contraction of the economy of -0.6% but
the March Quarter 2009 actually recorded a positive growth period of +0.4% which
defied earlier expectations that a contraction was close to certain. Sure enough
publications like that of The Economist and The New York Times made assumptions that
the recessionary phase would be a certainty for the Australian economy. The surprise
result meant that Australia has escaped two consecutive quarters of economic contraction
– the definition used by some economists for a technical recession. This is all the more
astonishing when you think that in the first quarter of 2009 the US economy contracted
by around 1.6 per cent, Canada by 1.4 per cent, Germany 3.8 per cent and Japan 4.0 per
cent.

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