Australian ICT trade deficit blows out to $21 billion

Stan Beer
Thursday, 19 April 2007 10:13

IT Industry - Market

Australia's ICT trade deficit has blown out once again, pushing it past $20 billion for the first time, according to new figures.

The ACS (Australian Computer Society) today released the findings of the 2007 Australian ICT Trade Update, revealing a growing annual ICT trade deficit of  $20.9 billion - an increase of six per cent over the $19.7 billion trade deficit for 2005.

The report, authored by Professor John Houghton, shows that in 2006, Australia’s ICT exports were worth $5.7 billion, while imports cost $26.6 billion.

There was an increase in ICT services exports of around $0.5 billion to $2.7 billion. However, the increase was more than negated by an increase of $0.73 billion to $3.76 billion in imported services more than negated the gains in exports.

Meanwhile, the position of hardware and software products trade balance deteriorated markedly. Exports of hardware and software dropped marginally to $3.01 billion, while imports rose by $0.8 billion to a whopping $22.83 billion.

It does not take a degree in rocket science to identify that Australia's problem lays with its massive annual hardware imports bill. However, the nation long ago missed its chance to become a center of hardware design and manufacturing excellence.

The ACS believes that Australia's best hope will be to increase its capability to deliver ICT services exports because it has the infrastructure to be an offshoring destination of choice to places like the US, Japan, UK and Europe.