Why does the acting Premier look so happy? Because ‘booming’ Queensland is leaving nation in its wake
Queensland’s domestic economy rose by 1.3 per cent in the June quarter and was almost 13 per cent above its pre-Covid levels, according to the State Government.
It came with figures showing the national economy grew by 0.4 per cent in the quarter.
Acting Premier Steven Miles said the domestic economy (not including exports) was leading the nation and declared it was “booming”.
However, economists remain wary of the downturn in the national economy as consumers stop spending. The data released yesterday showed that while there was still growth occurring, there was a per capita recession after two quarters of negative growth.
Treasurer Jim Chalmers remains confident that Australia can sidestep a recession.
The ABS data showed that private investment in Queensland in the June quarter rose by 1.4 per cent with new dwellings rising 2.3 per cent, renovations up 5.6 per cent and business investment up 0.3 per cent.
Economists said the Queensland results should be celebrated but there were important considerations such as that most of the growth came from government spending.
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Queensland’s quarterly growth of 1.4 per cent was more than double the national average of 0.6 per cent and annual growth of 3.9 per cent was ahead of the national average of 3.4 per cent.
“Queensland’s overseas exports of goods and services rose 20.2 per cent in the June quarter to be 17.5 per cent higher over the year,” the Government said.
Spending in hotels, cafes and restaurants was up 1.7 per cent while new vehicle purchases rose 3.5 per cent.
It claimed the rise in exports and unchanged imports in the quarter suggests the overseas trade sector made a solid contribution to Queensland’s gross state product growth in the June quarter.
“Queensland is booming. Our population is growing, we’re exporting more Queensland products to the world, we’re seeing increased investment in infrastructure and more money being spent in our state,” Miles said.
“In Queensland, government investment in infrastructure rose 10.9 per cent in the June quarter, with the ABS highlighting the Palaszczuk Government’s singificant investment in the Cross Rover Rail.”
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That spending, along with the spending on the Snowy hydro scheme, Inland Rail and the Western Sydney airport drove an 8.2 per cent rise in public investment in the quarter.
Treasurer Cameron Dick said the data was a clear indication of the confidence Queenslanders had in the security of their job.
Overall, strong performance compared to the other states, only SA has kept up the pace with QLD in this last quarter.
Griffith University economist Professor Fabrizio Carmignani said the results showed a “government driven” growth.
“These data align with the recent labour survey data release, which show an above national-average growth in the trend of employment for Queensland in July 2023,” he said.
“While of course we celebrate the good news, we also need to consider a couple of important factors.
“Most of the growth in state final demand in the June quarter comes from the public sector.
“Household consumption expenditure has increased by only 0.3 per cent versus general government expenditure (1.6%, and part of this is driven by the commonwealth).
“Household consumption growth in Queensland is still above national average, but below growth observed in SA, WA, and NT. Similarly, while gross fixed capital formation in the public sector has gone up by 8.9 per cent, in the private sector it has increase by only 1.4 per cent (lower than SA, WA, Tas, and NSW). ”
