Discover more about Australia and its economic history.
Learn about investors who have interests in Australia and see where there is investment potential in the country.

Economic History in Brief

Officially known as the Commonwealth of Australia, Australia is a country that consists of the Australian mainland, a large island called Tasmania and several smaller islands. Australia is the sixth-largest country in the world by total area and is the biggest country in Oceania.

The first European settlement of Australia was made in 1788 in what was known as Port Jackson and is now called New South Wales. Four British colonies were established, Western Australia, South Australia, Victoria and Queensland. Several stores were brought to the country along with over 1,000 convicts, seamen and marines who settled there to start their lives in a brand new environment. Land grants were eventually made, and by 1791 commercial whaling started. Whale oil and bone were profitable commodities and so this industry became one of the first major export industries in Australia. Before Governor King set up the value of a variety of foreign coins circulating in New South Wales in 1800, the first real means of exchange in Australia was rum. By 1821 private markets started functioning and from the 1820s economic growth became more and more dependent on rural commodities, for example, wool, that was supplied to Britain and Northwestern Europe as the industrial boom started. Several banks opened their doors to finance this trade, including the Bank of Australasia which was established in London in 1835 and the Union Bank of Australia which was launched in 1837. 

Two major depressions interrupted Australia’s economic growth which was once again stimulated by the gold discoveries of 1851. Mining, agriculture, local manufacturing and construction industries expanded to meet the needs of a rapidly growing population. The gold rush brought educated settlers from countries like the United Kingdom who brought skills that contributed to the growth of the economy and provided a foundation for free colonial societies. The flourishing economy fuelled by gold and wool lasted well through the 1860s and 1870s.

An investment boom in the 1880s saw massive economic expansion and an influx of capital led to the highest per capita incomes in the world during the 19th century. However, by the end of the century investors became concerned with actual returns and in 1890 a severe depression started. Several strikes followed but the worst of the crisis ended in 1894. Early in the 20th century, new goods like wheat, dairy and other agricultural products joined the economic activity of Australia alongside the wool trade. After World War Two changed the Australian economy completely, the country saw a series of economic reforms. Today Australia is a wealthy country that generates its income from various sources.

Investment Opportunities

Infrastructure investments into airports, telecommunications, utilities and ports in Australia can offer attractive returns. Long-term returns can also be expected from making investments into office blocks and shopping centres. Online marketplaces offer investors with higher returns. This includes peer-to-peer lending companies like Ratesetter. 

With the global food demand increasing, Australia has become a premium food supplier. Areas of investment include innovation in food processing and advanced agriculture production. Because of its diverse climate, and vast natural riches, Australia is home to one of the top 10 largest tourism markets in the world. It also has the largest aviation market. Because of these factors, Australia offers a secure and stable environment for investors into the tourism industry.

Companies Investing in Australia

Companies from across the globe are making investments into Australia and its booming economy. A Canadian agricultural technology company called Agrisoma Biosciences partnered with Qantas to invest in the first commercial aviation biofuel seed crop. The seed crop is an industrial type of mustard seed called Brassica Carinata (carinata). It is expected that this will be a big step in developing a renewable jet fuel industry in Australia. Biojet fuel made from carinata produces oil for biofuel and, protein for animal nutrition while it enhances the soil it is grown in. 

The Japanese company Oji Fibre Solutions, a subsidiary of Oji Holdings Corporation, opened a corrugated box manufacturing plant on the Gold Coast. The investment totalled around A$72 million and is expected to meet the increasing demand for packaging as the export growth in horticulture, processed food and meat is increasing. Another investor from Asia is Kimberley Agricultural Investment (KAI), one of the subsidiaries of Shanghai Zhongfu, a Chinese company which has made major investments in northern Australia. Their diverse portfolio of investment includes planting of quinoa, sorghum, chia seed, and breeding of beef cattle. 

Investors with Interests in Australia

As the largest direct investor into Australia, as the investment relationship between the United States and Australia works both ways, with many Australian companies investing in the United States, the combined investment is worth around A$1.47 trillion. A major recent investment bid was made by Harbour Energy Ltd. when it made an offer of US$13.5 billion as an investment into the Australian gas producer Santos Ltd. in early 2018. With an investment history that stretches over more than 60 years, another significant investor in Australia is Japan. The Australia/Japan partnership is known for its economic cooperation and as being both dynamic and strong. In early 2018 Japan’s direct investment into Australia reached A$91 billion. Investments sectors include renewables, agriculture, communications technology, information and financial services. There are around 420 Japanese companies and subsidiaries in Japan with over 58,000 employees. 


Australia is known as a prime investment destination because it provides a low-risk and relatively easy environment in which to do business. The country has a resilient economy filled with smart and enterprising people. It offers a secure location for business while it is connected to the world through various highly successful industries. Because investment has helped build the Australian economy, the Australian government welcomes a range of productive foreign direct investment (FDI), which has proven to be critical to the country’s economy. As the 13th largest economy in the world, Australia has naturally been seeking FDI to grow its varied industries and to continue competing globally while keeping pace with top international economies. 

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