CCIQ concerns over stalled Sunshine State economy
The Chamber of Commerce and Industry Queensland (CCIQ) says latest ABS figures show the Sunshine State’s economy has stalled.
Domestic State Final Demand in Queensland over the year to the December quarter has fallen by 1.7 per cent per cent, compared to a national average growth rate of 1.1 per cent.
CCIQ Director of Advocacy Nick Behrens said the positive aspect of today’s national accounts was, in seasonally adjusted terms, Queensland had finally recorded a positive quarter of growth, with State Final Demand rising by 0.1 per cent.
“However, compared to the national average which recorded growth of 0.4 per cent, the Queensland economy is falling behind,” he said.
“Queensland recorded the second lowest rate of domestic growth of all states, only ahead of Western Australia.
“The public sector did the heavy lifting in the quarter with general government consumption expenditure rising by 1.0 per cent and public capital expenditure rising by a significant 9.3 per cent,” he said.
“Household consumption expenditure only rose by 0.5 per cent. Pulling the Queensland economy down is the dramatic contraction in private capital expenditure, down by 3.5 per cent in the quarter.
Mr Behrens said Queensland had seen a continued drop-off in private investment – down 15.1 per cent over the year to December quarter.
“An under-performing China, historically lower levels of State Government infrastructure investment, downturn in the resources sector and financial market volatility are unquestionably making it tough.”
Mr Behrens said Queensland small businesses had responded positively to the lower Australian dollar, lower interest rates, lower oil prices and progress made on Free Trade Agreements.
“The recent Westpac group-CCIQ Pulse Survey of Business Conditions highlighted that business confidence continues to be extremely soft, with 44 per cent of Queensland businesses believing the state economy will weaken over the next 12 months.
“The figures highlight the imperative to boost business investment through promoting confidence.”
“The first step in restoring confidence must be recognition that Queensland is under-performing. It is only then that we can begin a strategy that boosts business confidence and in turn investment and employment.
“The forthcoming State Budget in June will be the vehicle for this to occur.”