Tasmania has recorded the nation’s strongest quarterly growth in new ABS data, but analysts are warning the impressive figures mask underlying fragility in the state’s economy.
The state posted a 4.7% increase in State Final Demand for the June quarter, a measure of demand and spending within the state.
Tasmania’s rate significantly outpaced other Australian jurisdictions, according to the Australian Bureau of Statistics data released yesterday.
Analysis by the Tasmanian Chamber of Commerce and Industry suggested the growth surge was primarily driven by the delivery of the new Spirit IV vessel from dry dock in Finland and the ownership acquisition of the new Spirit V.
“The Spirits kept the economy afloat in the June quarter and the priority now should be unlocking private investment so growth is broadly based and sustainable,” TCCI CEO Michael Bailey said.
Public investment soared 63.5% in the quarter as TT-Line took ownership of Spirit V, while private investment grew just 2.0% and household consumption remained flat.
TCCI estimates that without the Spirit acquisition, quarterly growth would have been approximately 0.5% rather than 4.7%.
Bailey warned against any government moves to increase financial burdens on businesses during the economically sensitive period.
“This is absolutely not the time for governments to be contemplating increases in charges, taxes or levies either,” he said.
The business group called for streamlined planning approvals, faster grid connections and procurement processes that benefit local firms to stimulate private sector investment.
Recent approvals for the Robbins Island wind farm and Marinus Link transmission project were highlighted as positive long-term developments, but Bailey said the encouragement immediate private investment is vital.
“TCCI will continue to work with the government and parliament to ensure public investment complements and catalyses private sector growth,” Bailey said.
