Just like the five kangaroos adorning the coin itself, our dollar has been jumping around a bit lately.
In mid-October, the Aussie Dollar briefly achieved parity with the Greenback for the first time since the AUD was floated in 1983. It had, of course, been regaining ground ever since its massive walloping in the late-2008 GFC. And, as we know, in those ensuing 20 months, Australia bucked the global trend by avoiding a technical recession.
This achievement alone has lead to commentators coining a few appropriate boxing metaphors. Australia’s economy, it seems, is ‘The Wonder From Down Under’ – boxing ‘well above its weight’ as the nation has done in so many other endeavours.
But how about a bit of ‘parity clarity’ here. The US100cent figure is, in itself, ‘just a number’, a psychological barrier we perceive. What IS very real are the trade ramifications of competing on a world stage and what our fluctuating dollar brings to that fight.
On the face of it, importing retailers and their buying public come out on top as iPads and luxury cars become cheaper. Aussie travellers get a win as well as our dollar stretches further in places such as America. But it’s now almost a case of ‘see ya, wouldn’t wanna be ya!’ when you compare employment figures for the two countries – at double digits, US unemployment is almost twice that of Australia’s.
On the down side of an athletic dollar are the negative effects on sectors such as farming, manufacturing and hospitality. This is a concern for Tasmania with its heavy reliance on tourism, manufacturing and primary exports (which includes the wine industry). These are all areas that have already been facing a myriad of challenges over the past few years.
As the AUD continues to remain high, Tasmania will have to contend with Australians opting to spend their travel dollars O/S and foreign travellers seeing Australia, in general, as a high-cost destination. And so it’s now more than ever that Brand Australia, and within that, Brand Tasmania, needs to look at its positioning and reinforce the ‘quality’ of the experience to justify the premium.
All forecasts point towards the dollar remaining at least in the mid US90s going into 2011; so if the Aussie buck doesn’t stop here, businesses within these industries will need to address how, and to whom, they market themselves or THEY may find themselves down for the count.