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The Australian dollar has steeply appreciated by 27.1 percent to A$ 1.29 against the U.S dollar early this year. The Australian dollar was worth A$ 1.77 to the American dollar in the beginning of last year. Those unprecedented changes in a foreign exchange rate can occur only in emergent cases like a foreign currency crisis. The Australian dollar has drastically appreciated against the U.S dollar, compared to the appreciation of other currencies, such as the New Zealand dollar (23 percent), the Brazilian real (22 percent), the euro (19 percent) and the yen (11 percent).
The sudden rise of the Australian dollar is basically attributable to the weak U.S dollar and Australia¡¯s exceptional economic growth. Amid the overall global economic downturn, the Australian economy grew by 3.75 percent in 2003. The appreciation of the Australian dollar has different effects on each industry of the country. The raw material industry is welcoming the rise. But the manufacturing and agricultural and livestock industry have been severely suffering from it because exports have dwindled, while imports have been on the rise. The damage to the two industries is estimated at more than A$4 billion. Australian consumers have been importing digital audio equipment, high-end IT products and furniture.
The strong Australian dollar has complex effects on Korea. Korea has experienced increasing exports of electronic and IT goods to Australia. From January through November in 2003, the export of color television sets increased by 98.8 percent, mobile phones 58.7 percent and computers 70.1 percent, compared to that of the same period of the previous year. Korea could suffer from rising prices of main raw materials like coal and iron ore, which are imported from Australia.
Parents whose children are studying in Australia have to shoulder a heavier burden. According to statistics from the Australian Ministry of Education, more than 20,000 Korean students are studying there, the second largest number following China. The number is growing by 20 percent every year.
Since March, the Australian dollar has been worth about A$ 1.3 against the U.S dollar. But recently, it has insecurely fluctuated. Australia is one of main trading partners. It is 12th largest importer and 6th largest exporter of South Korea. Cultural and educational exchanges are brisk between the two countries. South Korea needs to pay attention to any possible fluctuation of the Australian dollar in the future.
(englishnews@chosun.com )
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