Relations between Canada and Australia have always been steady, and both countries have remained in their respective positions on the global stage, with their economies doing well and key areas of trade being capitalized upon. However, given the tumultuousness of the rest of the world – from uneasy trade wars sparking with the US and uncertainty in the European Union – there is an argument that Canada and Australia should do more trade with one another.
Indeed, Australia is in the TPP-11 (Trans Pacific Partnership 11) and has a diversified market with many sectors open for robust trading. Both Australia’s and Canada’s extensive network of goods trading can extend benefits to other areas, including forex trading. Forex comes down to trading against a currency that is more volatile, so strong goods and commodities trading could improve the economies of these nations and, therefore, increase the viability of their currencies as stable components of forex trades.
Good Trade Boosts Forex
The forex (FX) market has been booming steadily since the 1970s, with the trade volume growing from 1.2 trillion in 1995 to 5.1 trillion in 2016, according to the Bank of International Settlements. Over 9.6 million people indulge in some kind of trading, which has been made so much easier since the 1970s with the development of direct FX platforms, which allow for easy trading without the need for a middleman. Trading of forex pairs, such as Canadian and Australian dollars, is a good measurement of how each country is doing economically, especially compared with countries whose currencies are known to fluctuate. Both countries have steady economies, so opening up the world of trade more between them could see dividends for both the Great White North and Down Under, especially when contrasted in forex pairs against less stable currencies.
Australia’s Strong Economy
Indeed, Australia’s economy has been given an AAA rating, which came in part because of the budget developed by Scott Morrison (then Treasurer, now Prime Minister) while Malcolm Turnbull helmed the country. The report announced that S&P, the company responsible for allocating the ratings, considered Australia’s economy to be one of the best in the world. So, it’s no surprise that on a ranking of world leaders’ salaries in the OECD (Organisation for Economic Co-operation and Development), Scott Morrison takes the top spot, bringing home $527,854. In contrast to this are countries such as the US, whose President, Donald Trump, earns $400,000, and the UK, where Prime Minister Theresa May takes home $212,247. Justin Trudeau brings in $267,041 in comparison.
One of the major benefits of increasing Canada’s trade with the southern hemisphere is that Australia may just be Canada’s gateway to trading with the Asia-Pacific region. Australia’s involvement with both the Asia-Pacific Economic Cooperation (APEC) and the Association of Southeast Asian Nations (ASEAN) means that trade with it would open up further trade for Canada. Ultimately, opting for more diversified markets could help boost Canada’s economy.
A stronger trade agreement between Australia and Canada would enable both countries to further explore their abilities as strong trading nations. As the markets in 2019 are tumultuous, finding fellow sturdy economies could protect against possible economic trouble.