Australia's economy growing a little faster

Kings Park in Perth
Kings Park in Perth

Australia's economic growth is expected to have strengthened a little at the end of 2013, getting a boost from a lift in mining and resource exports.

December quarter gross domestic product (GDP) is expected to have grown by 0.7 per cent, for an annual rate of 2.5 per cent, according to an AAP survey of 12 economists.

In the September quarter, GDP growth was 0.6 per cent, and 2.3 per cent in the year to September.

The Australian Bureau of Statistics (ABS) will release National Accounts figures on Wednesday.

JP Morgan Australia chief economist Stephen Walters said mining and resources exports took over from mining and resources investment as the main driver for economic growth in 2013.

"There was a substantial shift in Australia's growth drivers in 2013, with the decade-long dependence on resource investment giving way to an inflated reliance on real net trade," he said.

"The upshot from fading resources investment is that output from the associated projects is starting to come online, particularly in the iron ore and coal sectors, with a further lift in liquefied natural gas (LNG) capacity expected further down the line.

"In 2013, iron ore, coal, and LNG comprised more than half of Australia's total export basket, with this share set to swell in coming years."

Commonwealth Bank chief economist Michael Blythe said Australia continued to post solid economic growth but it was still below its long-term average.

"This outcome is not unexpected," he said.

"But some perspective is needed here.

"Even at a sub-trend pace, the Australian economy has just clocked up 22 years of continuous economic growth.

-AAP

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