Australia has not experienced a recession in four decades. The economy has grown every year since 1990. Consider the chaos we in the West have experienced economically, financially, industrially and politically in those years. Down here, an entire continent has sailed through various global crises. It’s very remoteness may have contributed to this economic serenity, but its sheer size has also helped.
It has a land mass larger than the United States, with the population of the Netherlands and Belgium combined, and 90 per cent of its inhabitants live in 2 per cent of the available land. It is vast, empty and very old – about 60 million years old. For most of this time it was devoid of humans, so when the world’s most successful predator finally arrived, they had less time to damage existing animals and plants.
The indigenous population were maritime invaders who arrived on boats from Indonesia, possibly 60,000 years ago; the second seafaring conquerors, the British, rocked up in 1770. Europeans have only been in Australia for about 0.3 per cent of the total time it has been occupied by humans or, to put it another way, for 99.7 per cent of the time humans have been present on this vast continent, the Aboriginal and Torres Strait islander peoples had the place to themselves.
Today, it seems like the whole world wants to come to Australia. To work. At anything. One of the most unusual developments in Sydney has been the near monopolisation by the Irish of the lolly pop lady. As befits a city going through a growth spurt, Sydney is a large building site, and building sites in cramped urban areas disrupt traffic and pedestrians who must zigzag the various diggers, wires and trucks. Someone has to usher the punters around these obstacle courses, and lo and behold, it’s young Irish people.
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Irish graduates are also taking up a side-hustle in hairdressing. And there are lots of them out here. About 10,600 Irish people emigrated to Australia in the year to April 2024, the highest since 2013 when the crash and the slump in the property sector forced thousands to head down. That figure of 10,600 is up a massive 126 per cent from the 4,700 Irish emigrants who arrived in the previous 12 months. However, 6,400 people also returned to Ireland from Australia last year.
So the to-ing and fro-ing between Ireland and Australia continues apace. There is barely an Irish family that doesn’t have a cousin, sibling or friend who has headed out here in recent years. There are now 103,080 Irish-born people living in Australia, the first time since the late 19th century that the figure has been above 100,000.
The recent Irish growth trend is remarkable. Twenty years ago, in the Australian 2004 census, there were 55,000 Irish-born living in the country. In the 2024 census, the Irish population had doubled to 103,080. As Ireland has become richer, more and more Irish people have elected to head Down Under. (This one statistic underscores the dramatic management problem that Ireland has, where the quality of life has deteriorated as the standard of living has increased. I will come back to this issue.)
The big question is how Australia has got the economy so right. To put the Australian performance since 1990 into perspective, in the same period, the US – so long seen as the source of economic vitality – has experienced three recessions, one massive tech crash, followed by an even more debilitating banking collapse, while Washington’s politics has lurched from technocracy to populism and back before whiplashing again. Canberra, despite having elections every three years that are underpinned by a universal compulsory mandate, is an oasis of relative calm and continuity.
The best evidence of this political consistency is that in spite of different parties holding the reins of power, Australia’s government debt is around 40 per cent of GDP, about half the level of the US or UK and only a fraction of that of Japan, France or Italy.
Two major factors explain Australia’s success: people and geography.
In the past three decades, immigration has swollen the population, and those immigrants, who must “qualify” to gain entry, have driven the economy. As of mid-2024, 31.5 per cent of Australia’s residents were born overseas – about 8.6 million out of 27.2 million people. This is the highest share since the 19th century and the highest in the developed world. In 2022–23, net migration hit a record 536,000, as Australia reopened after the pandemic. More people make the economy bigger; however this is also fuelling housing problems, not unlike in Ireland. What used to be a very European-looking country is now beginning to look more Asian. There are now 916,000 India-born and 700,000 China-born Australians. Yet – and we tend to forget this in Ireland – the English are also a big emigrant nation. Today the largest foreign population in Australia is still English, at 964,000.
In terms of geography, the country is blessed with an unsurpassed geological legacy. It is the resource capital of the world. Consider iron for making steel. Australia is the world’s largest exporter of iron ore, supplying roughly one-third of the globe, mostly to China. In 2025–26, iron ore alone is forecast to earn about A$113 billion (€63 billion) for Australia, accounting for a quarter of all commodity export revenue. Coal is another heavyweight. Australia is the world’s second largest coal exporter, with 26 per cent of the world market, and is among the top three for liquefied natural gas exports. Total resource and energy export earnings allow Australia to run consistent trade surpluses, meaning it can import all sorts of manufacturing goods from the rest of the world, all paid for with these resource dollars.
Although Australia was like Britain Down Under for 100 years, in the past few decades, the Aussies have realised they are in Asia. More importantly, the two billion Asians that have been brought out of poverty since 1990 need Australian energy and resources to power their economic surge. Being Asian in the 21st century is like being European in the 19th century – you are where the economic action lies.
In addition to the strategic factors such as immigration, there’s an Aussie spirit, a get up and go about these people. They share with their American cousins an entrepreneurial no-nonsense culture that generates its own innovative dynamism, propelling the country forward. It is extremely hard to put your finger on, or bottle this ephemeral thing that Keynes described as “animal spirits”, but the Aussies have it. It is a pragmatic, problem-solving culture that appears to be able to get the best out of things.
For example, Australian cities consistently rank at the very top of global quality-of-life indices despite the fact that the state doesn’t spend nearly as much on public infrastructure as its European counterparts. The implication is that the Australians get a bigger societal bang for their government spending buck. For instance, Melbourne is ranked the fourth most liveable city in the world, with near-perfect scores on stability, healthcare and infrastructure, far outranking wealthier Western capitals such as Paris, which languish at 31, and yet government spending in Australia is around 38 per cent of GDP, versus 57 per cent in France. They must be doing something right.
Australia is regularly referred to as “the lucky country” but you know what they say about luck: you make your own.
