PUBLIC PROP-UP FOR GDP; FARMING FILLIP
Public spending props up flat economic growth
Australia’s economy has continued its pattern of weak economic growth, with gross domestic product (GDP) rising by a slender 0.3 per cent seasonally adjusted in the September quarter and by 0.8 per cent for the year. Latest figures from the Australian Bureau of Statistics show that only increased government consumption (up 1.4 per cent for the quarter) and public investment (up by 6.3 per cent) kept GDP in positive territory. Annual growth was the lowest since the quarter of December 2020. On a population basis, however, annual GDP per capita fell by 1.5 per cent. While exports rose slightly (aided by increased coal exports), imports fell as a result of weaker household demand; household consumption remained unchanged at 0.0 per cent growth for the quarter.
Export prices easing, but farm production up, says ABARES
Annual farm production by value will rise seven per cent to $88.4 billion in 2024-25, according to the Australian Bureau of Agricultural Resource Economics and Sciences (ABARES). Latest forecasts from ABARES project that the gross value of agricultural production will be the second highest result on record, driven by higher livestock prices and rising crop production. ABARES says the production value of crops will rise $2.2 billion to around $50 billion, offsetting lower export prices. Livestock and livestock products are tipped to rise by $3.8 billion, to around $38 billion. If fisheries and forestry are included, the gross value of primary production is $94.3 billion.
Bowen pumps up the case for gas
Energy and Climate Change Minister Chris Bowen has affirmed his support for gas, as Australia moves to head off projected gas shortages by 2028. Speaking after the Energy and Climate Change Ministerial Council in Adelaide, Mr Bowen said the nation’s energy ministers were working on a public sector framework (assisted by private investment) to deliver more gas, following the advice of national regulators. Mr Bowen said gas had an important role in supporting the transition to a renewables component of 82 per cent of the energy market. Governments would continue to work together to ensure the reliable supply of gas, not only to gas-fired power stations, but for other uses. Mr Bowen said gas was a “flexible fuel, which you can turn on and off at two minutes’ notice”, and gas was vital for Australia’s industrial heartland.
Government sector dives into deficit
Underlining the increased contribution of public spending in the economy, separately-released finance statistics from the Australian Bureau of Statistics show escalating deficits across the three tiers of government. In the September quarter, the general government net operating balance fell from a surplus of $14.4 billion in the June quarter to a deficit of $18.3 billion – a fall of $32.7 billion. The level of general government borrowing soared from $6.3 billion in the June quarter to $30.2 billion in the September quarter.
Australia, NZ step up ties in defence cooperation
Australia has formally reaffirmed its defence ties with New Zealand, committing to greater integration and interoperability across their army, navy and air forces. Defence Minister Richard Marles and his NZ counterpart Judith Collins pledged to modernise the Anzac alliance and further strengthen the bilateral defence relationship. Their joint statement committed to common air force capabilities, combined training and interoperability of maritime capabilities, and embedding of units in the respective armies. In addition, the Ministers committed to support interoperability through greater common procurement of defence platforms and systems.
Chalmers downplays future energy price relief
Treasurer Jim Chalmers has rebuffed suggestions that the Federal Government will implement another round of energy rebates to relieve cost-of-living pressures. In a media interview, the Treasurer said previous energy rebates had taken the pressure off household budgets, while tax cuts had boosted incomes. Dr Chalmers said people should not expect to see an extension of cost-of-living measures when he delivered the mid-year economic and fiscal outlook (MYEFO) later this month.