Services also account for a significant amount of trade with other countries. In 2016, services made up 21.6% of Australia's total exports. When the value that Australian services add to goods exports is also taken into account, services represent around 40% of our export earnings.
Australia is a world-class provider of a range of services, such as professional services, education and tourism, financial services, energy and mining-related services, environmental services and financial technology (FinTech). These are Australia's priority sectors for improving market access in global services trade reform efforts.
What are Australia's main services exports?
In 2016, Australia's five-largest services exports were:
- Education-related travel services – $22.0 billion
- Recreational travel services – $17.4 billion
- Professional services – $4.8 billion
- Business travel services – $4.2 billion
- Financial services – $3.5 billion.
The figures above show that tourism and travel remain vitally important to our economy and international services trade.
How do open services markets benefit Australia?
Encouraging more trade in services through open markets and non-discriminatory treatment can lead to higher employment levels, improved incomes and better standards of living.
Opening up some service sectors to competition gives Australian consumers access to a wider range of services and more national and international expertise.
The increased competition that free trade brings also encourages local service providers to become more innovative and efficient in the way they deliver their services. This has benefits for other areas of the Australian economy that rely on the services sector.
The contribution of services to global trade and developing countries
In 2015, global services exports were valued at US$4.8 trillion, nearly a quarter of the world's total exports.
Efficient service sectors supported by good domestic regulation are major drivers of economic growth, especially in developing countries. Services already make significant contributions to the GDP of many developing countries, with services trade – particularly tourism – an important income source. Lower wages also give developing countries an advantage in more labour-intensive service sectors such as shipping and construction.
How does DFAT promote improved services trade?
Australia is currently involved in the Trade in Services Agreement, a services-only agreement led by Australia, the European Union and the United States.
We also support services exports by negotiating Free Trade Agreements with other countries.
Find out more about Australia's services trade
The DFAT publication Trade in Services Australia contains detailed statistics on the composition and direction of Australia's services trade and how this compares to global trends. It is updated twice a year for calendar and financial years.