The Impact of the Asian Crisis on Australia's Primary Exports: Why it Wasn't so Bad

Posted: 7 May 2001

See all articles by Ron Duncan

Ron Duncan

Australian National University (ANU) - National Centre for Development Studies (NCDS)

Yongzheng Yang

International Monetary Fund (IMF) - African Department

Abstract

This article explores the modest impact of the Asian Crisis on Australia's primary commodity exports. Simulations using a global general equilibrium model show: (i) as capital flees Asia, investment in Australia increases and the trade deficit grows; (ii) while terms of trade deteriorate in the short run, they improve in the medium run as import demand increases in the crisis countries; (iii) exports of primary commodities expand as the crisis countries try to export more; (iv) more income-elastic primary commodities fare less well than the income-inelastic foodstuffs as incomes decline in the crisis countries; (v) Australia's relatively low dependence on manufactured exports was a buffer as manufactured exports came under heavy pressure from exports from the crisis countries.

Suggested Citation

Duncan, Ron and Yang, Yongzheng, The Impact of the Asian Crisis on Australia's Primary Exports: Why it Wasn't so Bad. The Australian Journal of Agricultural and Resource Economics, Vol. 44, No. 3, September 2000. Available at SSRN: https://ssrn.com/abstract=241292

Ron Duncan (Contact Author)

Australian National University (ANU) - National Centre for Development Studies (NCDS) ( email )

Canberra, Australian Capital Territory 0200
Australia
(02)6125-4765 (Phone)
(02)6125-5448 (Fax)

Yongzheng Yang

International Monetary Fund (IMF) - African Department ( email )

1700 19th Street, NW
Washington, DC 20431
United States
202-623-4339 (Phone)
202-623-4237 (Fax)

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