Australia built its wealth on iron ore. Now China holds the cards
Pro-growth policies that strengthen economic resilience would help us weather global economic firestorms, such as the oil price-induced panic that engulfed markets.
We should already have been alert to the shifting dynamics of the Australia-China iron ore market, given the potential impact on an export that has propped up government budgets for a generation.
But Monday’s market slump dramatically emphasises the volatility of global markets and Australia’s vulnerability to sharp movements in commodity prices. The 3.2 per cent fall on the ASX200, the biggest drop since Donald Trump’s “liberation day” tariff announcements on April 1 last year, was triggered by oil bursting through the $100 a barrel mark due to the war between the US, Israel and Iran.
