Ai Group: QLD budget 'sound' but immediate pressures remain
Ai Group Queensland State Director Jemima Dunn expressed approval of the 2015-16 Queensland budget’s view to improve State finances through debt reduction and encouraging the greater diversification of Queensland industry.
"Ai Group also welcomes $180 million Advance Queensland program over the next four years which aims to building greater collaboration between industry and researchers, and ensure greater commercialisation of innovative products by businesses.
"The fact is Queensland's economy must diversify beyond its heavy reliance on the resources sector, and encouraging innovation and entrepreneurship among business is key to achieving this goal to build a broader and more sustainable economy.
"The success of this program, however, will depend heavily on the engagement of industry and Ai Group looks forward to working with the Queensland Government on the delivery of these initiatives.
"While this is a good long-term Budget, it is clear that in the short-term, the Queensland economy faces significant challenges as the mining investment boom winds down. Industry throughout the state and across the country is under pressure from weak demand, and low confidence. The recent fall in the Australian dollar is providing some relief but the business investment outlook remains tepid.
Major infrastructure projects are needed
"Against this backdrop, Ai Group believes there is a strong case for investments in productivity-enhancing infrastructure to boost activity and provide a pipeline of work for industry, while addressing the infrastructure deficit that burdens industry and households throughout the state.
"Unfortunately this Budget did not commit to any new major infrastructure projects across the state. These are vitally needed and would also boost activity in the near-term at a time of slow activity. We urge both the Queensland and Federal Government to work together in a timely fashion to deliver on much-needed projects.
Dunn says that the announcement that the Government would welcome unsolicited bids from industry on infrastructure is a positive step and has the potential to deliver projects with innovative financing arrangements.
She stated that Ai Group "encourage the Government to ensure that any projects it proceeds with through this particular channel must be appropriately analysed and fit within a medium and long-term infrastructure plan. That said, it is important that sound investments are delivered quickly."
"Ai Group acknowledges that the budget situation in Queensland is challenging and this Budget outlines a sensible plan of debt reduction. But the Queensland economy is experiencing weak demand and conditions are challenging. Never before has the case for encouraging diversification of industry in the Queensland economy and delivering on infrastructure investments been stronger.
"We look forward to working on behalf of Ai Group members with the Queensland Government to address these challenges so Queensland industry can reposition and thrive," Dunn said.
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