WA faced a “screaming demand” to diversify its economy to ensure the State was “more than just mining”, Opposition leader Mark McGowan says.
Responding to the latest Deloitte Access Economics Business Outlook that WA’s mining boom is about to peak, Mr McGowan said today that it was important WA had strong manufacturing, science and technology and tourism industries to withstand any reduction in the mining industry.
“While mining is incredibly important to the State, Western Australia needs to be more than just mining,” he said.
“There is a screaming demand for diversity in our State’s economy. We can’t just allow mining to be everything. We have to make sure other industries have a look in as well.”
Mr McGowan said while mining would “always be successful” in WA, he flagged urgent investment in tourism marketing as well as science and technology, which had suffered significant budget cuts.
With the housing sector identified in a separate Commsec report today as the one area lagging in economic growth in WA, Mr McGowan said an urgent resolution was needed to ongoing problems with the Building Act.
“The biggest hindrance to our State’s building industry is the Building Act, which has halved the rate of approvals in Western Australia’s housing – the second-biggest employer in the State,” he said.
Mr McGowan said despite WA’s economic growth, people had seen big increases in the cost of living and State debt with “very few projects that they can call their own”.
He said Perth Arena, Fiona Stanley Hospital, Perth Theatre and expansion of the rail network were projects started under the former Labor Government.
“I don’t actually see many things that this Government has done,” he said.
Meanwhile the Chamber of Minerals and Energy of WA said the Deloitte Access Economics report released today predicting an end to the “boom” did not paint an accurate picture of the industry’s future.
CME chief executive Reg Howard-Smith said the nature of the resources sector would change as the construction of projects were completed in the near term and moved into production but this was not a signal the sector would decline.
“Construction of the current wave of projects is expected to peak over the next 18 months and those projects will then move into the production phase which requires different skills and is expected to last until the end of this decade,” he said.
“We’ve got a long way to go. There are expansions currently under construction and significant new oil and gas projects and mineral projects which haven’t started producing, so the full economic benefits are yet to be felt.
However Mr Howard-Smith said Australia had to be seen as a desirable place to invest to ensure the resources sector continued to grow.
“There are concerns that Australia is becoming a less attractive place to develop projects and investment may be driven to other regions because of additional layers of taxation through the Minerals Resource Rent Tax and the Carbon Tax, coupled with rising costs for doing business and an inability to source skilled labour,” he said.
“It’s therefore important that both the State and Federal fovernments support policies that focus on improving productivity such as encouraging people moving around the country to fill job vacancies, genuine tax reform and cutting green and red tape.”