Business Case Studies, Macroeconomics Case Study, Australia, Current Account Deficit

print page
Tell A Friend

Case Categories

Macroeconomics Case Study

Case Title:

Australia: Managing the Current Account Deficit

Publication Year : 2004

Authors: N Bhavika, G Srikanth

Industry: General Business


Case Code: MEBE0034

Teaching Note: Not Available

Structured Assignment: Not Available

Buy This Case Study

Abstract: The Australian economy had a consistent growth, which was supported by an increase in domestic demand. For many years, the GDP (gross domestic product) growth rate was high, but the country had current account deficit. The Australian government took measures such as floating the Australian dollar, tightening its monetary policy and cutting the tariffs to encourage trade and reduce the gap in the trade balance. The government also implemented structural reforms like introducing a new tax system and the superannuation guarantee scheme. Although these reforms helped to increase the public revenue and encourage savings among the people, the Australian government was unable to manage the current account deficit. The current account deficit followed a cyclical trend, as it reduced in 2001 and widened again in 2003.

Pedagogical Objective:

  • To discuss the reasons that led to the growing deficits in the current account of Australia and how the Australian government tried to manage it.

Keywords : Australia's current account deficit; Domestic demand; Superannuation guarantee scheme; Australian dollar; Reserve Bank of Australia; Inflation targeting and monetary policy; Net foreign liabilities; Goods and services tax; Australian accounting standards

Recently Bought Case Studies

    Recently Bought Case Studies

    Executive Interviews

  • David ConklinDavid Conklin

    David Conklin, is a professor at the Richard Ivey School of Business
    Speaks on Government and Business
  • Lord Meghnad DesaiLord Meghnad Desai

    Lord Meghnad Desai, is an Indian-born British economist and Labor politician
    Speaks on Government and Business
  • Vijay GovindarajanVijay Govindarajan

    Vijay Govindarajan, is widely regarded as one of the world’s leading experts on strategy and innovation
    Speaks on Reverse Innovation
  • View All Executive Interviews»

Contact us: IBS Case Development Centre, Survey No. 156/157, Dontanapalli Village, Shankerpalli Mandal, Ranga Reddy District, Hyderabad-501203, Telangana, INDIA, E-mail:

©2020-2025 IBS Case Development Centre. All rights reserved. | Careers | Privacy Policy | Terms of Use | Disclosure | Site Map xml sitemap