Economic outlook and trade
Economic optimism
Despite global economic headwinds including persistent inflation, optimism about Australia’s economic performance in the next five years remains reasonably solid (62%), unchanged from 2022. While this is 17 points lower than optimism in 2021 (79%), when there were high hopes for a post-Covid global economic recovery, it is ten points higher than the record low registered at the outset of the pandemic in 2020.
This relatively stable outlook on Australia’s economic prospects mirrors Australians’ perceptions of the global economy. In 2023, the number of Australians who see ‘a severe downturn in the global economy’ as a critical threat (57%) has not increased substantially from 2022.
A neutral option was offered to respondents in 2005 and 2007.
Indicates change in mode: see 2024 Methodology.
However, when it comes to the strength of optimism people feel, barely any Australians are now ‘very optimistic’ about the economy (3%), in contrast to the 19% who said they were very optimistic in 2010.
Looking across age groups in the Australian community, there is a difference in opinion on this issue between those at the opposite ends of the age spectrum. While 68% of those aged 60 years and over are optimistic about Australia’s economic performance in the next five years, only 55% of those aged 18–29 feel this way.
Supply chains
In recent months, senior US officials have outlined a strategy to improve the resilience of critical supply chains by sourcing goods mainly from friendly countries. US Secretary of the Treasury Janet Yellen referred to this as ‘friendshoring’ and cast it as, among other things, a response to the ‘over-concentration of the production of critical goods inside China’.
In the context of the Covid-19 pandemic, Russia’s invasion of Ukraine, Chinese trade restrictions on Australia, and rising US–China tensions, the idea of friendshoring supply chains also appears to resonate with Australians.
Supply chains
Now thinking about global trade and the supply chains through which Australia sources goods from other countries. In your opinion, which of the following statements should be a higher priority for Australia?
Lowy Institute Poll results on this issue are almost identical to those from polling conducted by the Chicago Council on Global Affairs in the United States in November 2022. Asked a similar question, seven in ten Americans (69%) say the United States should prioritise ensuring supply chains run through friendly countries, even if this means higher prices. Only three in ten (29%) say the United States should prioritise keeping prices as low as possible, even if it means supply chains run through unfriendly countries.
A strong majority (70%) say that Australia should place a high priority on ensuring supply chains run through countries that are friendly towards Australia, even if it means higher prices. Only three in ten (29%) say the priority should be ‘keeping prices as low as possible, even if it means that supply chains run through countries that are unfriendly towards Australia’.1
However, opinions differ by age. People aged 45 and over are more likely to prioritise ‘friendshoring’ (79%) than people aged under 45 (59%).
Conversely, more people aged under 45 place a priority on keeping prices as low as possible (40%) compared to those aged 45 and over (19%).
- Lowy Institute Poll results on this issue are almost identical to those from polling conducted by the Chicago Council on Global Affairs in the United States in November 2022. Asked a similar question, seven in ten Americans (69%) say the United States should prioritise ensuring supply chains run through friendly countries, even if this means higher prices. Only three in ten (29%) say the United States should prioritise keeping prices as low as possible, even if it means supply chains run through unfriendly countries.