The International Monetary Fund has prasied Australia’s economic position, saying that the country is well positioned to continue to reap the benefits from the ongoing commodity boom, a sound financial policy framework and a stable financial services sector.


In the annual Economic Health Check of the Australian economy, the IMF found that despite increasing uncertainty surrounding the state of the global economy, the country has an ‘almost unprecedented opportunity’ to protect itself from future economic shocks.


Australia’s recovery from the global downturn has been driven by a mining boom and strong demand for its natural resources from emerging Asia. This has provided the Commonwealth government with the means to save for future downturns, and meet the growing costs of an aging society and rising health care expenses.


“This is a really historic opportunity for Australia. Commodity prices have not been as high for a very long time,” said Ray Brooks, the IMF’s mission chief for Australia. “It now needs to make the most of its situation and set itself up for the future,” he added.


Australia’s economic performance since the global financial crisis has been “enviable,” according to the IMF economists who drew up the annual assessment.


The report praised the country as ‘one of the few’ advanced economies that had avoided falling into recessions, praising hthe ‘supportive macro policy response, a healthy banking system, and a flexible exchange rate, as well as robust demand from Asia.


‘Extraordinarily strong demand for Australian coal and iron, particularly from China’s steel mills, has pushed the country’s terms of trade to a 60-year high,’ the report found.


The report concluded by verifying the projected GDP growth of 3.5 per cent in the 2011 – 2012 financial year.


The report also warned of waning demand from Asia could derail the Federal Government’s ‘ambitious plan’ of returning the budget to surplus by the 2012/13 Federal Budget.


The full report can be found here