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RATING THE STATES: NO NATIONAL PATTERN TO ECONOMIC GROWTH

20-11-2018
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All Australian states and territories recorded an increase in gross state product in 2017-18, according to the latest figures from the Australian Bureau of Statistics. The ACT, Victoria, Queensland and Tasmania exceeded the national gross domestic product growth rate of 2.8%, while New South Wales, South Australia, Western Australia and the NT grew more slowly.

Nationally, healthcare and social assistance grew, reflecting consistent public investment in health by state and territory governments, with new facilities opening in Victoria, Queensland and SA.

Manufacturing performance was a mixed bag, with above average growth in New South Wales, Tasmania and Queensland offset by slower than average growth in Victoria and SA.

Each state and territory had its star performers. NSW’s economic growth of 2.6% was driven by construction (+6.1%), manufacturing and related services as a result of ongoing investment in public infrastructure.

In Victoria, health and social services (+7.9%), construction, and finance and insurance contributed nearly half of the state’s growth of 3.5%, with construction driven by dwelling construction and public infrastructure.

Queensland’s growth of 3.4% was driven by electricity, gas and water supply (+8.6%), the result of increased electricity production to meet demand from the southern states, as well as health and construction, reflecting increased private investment in non-dwelling construction.

In South Australia, growth in health (+8.6%) and electricity, gas, water and waste, was offset by a fall in agriculture, forestry and fishing (-12%, with wheat production returning to usual levels following extraordinary growth of 19.5% in 2016-17) to result in moderate total growth of 2%.

Similarly in Western Australia (total growth 1.9%), a fall of 12.1% in agriculture, forestry and fishing, as wheat returned to regular levels, offset growth in health (8.8%) and mining, which continues to dominate the economy there, driven by iron ore mining, and oil and gas extraction for export in response to global demand.

Tasmania’s growth of 3.3% was its strongest in ten years, led by professional scientific and technical services (+10.2%) supporting mining, food and beverage manufacturing, and construction.

The NT’s growth of 1.7% was the weakest nationally, reflecting slowing private investment and its consequent effects on related industries. The very small wholesale trade sector increased 4.6%.

On the other hand, the ACT recorded the strongest growth of any jurisdiction, at 4%, driven by administrative and support services (+19.9%) and professional scientific and technical services, especially those supporting the Australian Public Service.

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