Australia had endured a severe recession that lasted until 1923. The country was beginning to recover with an economy based primarily in the export of agricultural goods. Unfortunately, the United States, Canada and Argentina began producing agricultural products for market at the same time. They created a global oversupply of Australia’s major exports, which were wheat and sheep. Prices fell, and Australia’s economy was hit hard in the second half of the 1920s. The country also borrowed vast sums of money that dried up as the economy slowed.
Then came the Great Depression. Australia’s economy collapsed and unemployment hit 32% in 1932. Hundreds of thousands of Australians were out of work. Children had nothing to eat, and suicide rates increased dramatically. National income declined by a third. The depression persisted throughout the decade.
Australia started its anti-immigration policies with The Enemy Aliens Act in 1920. This act didn’t allow entry of immigrants from Australia’s former enemies during World War I inside the country for five years. The affected countries were Germany, Austria, Hungary, Bulgaria, and Turkey. The restrictions continued to build in the mid-1920s. Quotas were placed on the number of immigrants coming from Southern and Eastern Europe. Australia feared that large numbers of immigrants would arrive in their country as had happened in the United States during this time period.
During the economic depression of 1930s there were very few immigrants entering the country. In fact, there were more people leaving Australia than arriving. By 1938 there was a slight improvement in immigration opportunities. A decision was made to allow 15,000 Jewish refugees to enter the country over a three-year time span. Yet only about 3,500 of them arrived and entered the country before the start of the war. This was partly due to the Australian government’s financial requirements. Jewish refugees had a hard time meeting these requirements because they had been robbed of possessions and wealth by the German Nazi regime.