Trade surplus expands as foreign tourists start to come back
Australia’s international trade surplus continued to expand during April with a positive trade balance of nearly +$10.5bn for the month, an increase of just over three-quarters of a billion dollars.
The expansion in the trade surplus was helped significantly by an increase in tourism related service exports (up $444m over the month in seasonally adjusted terms) – which, while still only 40 percent of the equivalent value of April 2019 is nonetheless a positive sign that foreign visitors are starting to return to Australia.
However, the outflow of Australian tourists to foreign destinations also rose by nearly $100m on last month – with nearly half-a-billion dollars’ worth of tourism-related expenditure by Australians occurring overseas during the month of April.
These results are consistent with the preliminary overseas arrivals and departures data for April which showed a 200,000 person increase in arrivals and a 280,000 person increase in departures – although when considering these departures numbers with the April international trade data then it seems likely that some of these people leaving Australia are non-residents returning home.
Australia is still riding on the diggers’ backs with export values of three key resources – coal (+$500m); iron ore concentrates (+$300m); and petroleum oils (+$200m), underpinning the monthly growth in merchandise goods exports.
The importance of commodities to Australia’s economy was also evident in yesterday’s GDP figures where mining sector profits surged 14.7 percent, meaning that profits in the sector now account for over 50 percent of all corporate profits. The last time this threshold was breached was in 2008, and with prices still elevated this is likely to remain the case in the near term.