Above is an interesting segment from ABC’s The Business last night, which discusses a new Deloitte Access Economics report highlighting five “fantastic” growth industries that are poised to take the baton from mining over the next few decades, namely:
- agribusiness;
- gas;
- tourism;
- international education; and
- wealth management.
According to Access, these industries could grow to account for 10% of the Australian economy, helping to drive the post-mining economy.
Bank of America-Merrill Lynch chief Australian economist, Saul Eslake, who is also interviewed in the segment, is cautiously optimistic that these industries can pick-up the slack. However, he notes that unlike the markets for iron ore, coal and natural gas, where gains for Australia were fairly easy, Australia would face intense competition from overseas, limiting the potential upside.
Eslake also cautions on the sharp drop-off in workforce participation by the young, which is down 8% since the GFC and risks permanent losses from Australia’s productive potential.
One curious aspect from the segment is Access Economics’ Chris Richardson noting that significant potential lies in Australia food processing sector. Yet, a casual examination suggests that Australia is not globally competitive in this space, given the nation nearly witnessed the exiting of its last major cannery – SPC Ardmona – earlier this year.
Moreover, a group of growers have today warned that the decrepit state of rail freight infrastructure is placing Australian producers at a competitive disadvantage, limiting Australia’s ability to cash-in on the Asian food boom.
Clearly, much more work needs to be done by government at all levels, along with industry.
