Economic outlook Australia and Central Highlands
Is the economic outlook for the Central Highlands positive or negative? Before we talk about the Central Highlands let’s take a brief look at the world economic outlook and then Australia.
The global economic outlook is improving and following the budget, Australia’s future is looking good. To balance the books any business or household can either reduce spending or increase income and this budget is based on increasing jobs and more employment, which int turn will create more income.
What effect did the budget have on Australia’s credit rating? Moody’s were quite impressed and Australia has kept its AAA credit rating.
There is definitely a more positive attitude among the residents of the Central Highlands.
Let me use golf as an example? In recent years all clubs had difficulty in getting enough players for their open events but recently this has changed. Last month Tieri had a full field and the Saturday before last, at Blackwater, they had so many players that the last three groups ran out of daylight and could not finish.
I have not seen this happen for years, but it is a great indicator of the certainty and optimism that now exists regarding the economic outlook.
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With World demand for both thermal and coking coal increasing and the recent increase in the price of coal, we again have employment certainty and confidence.
What about the other sectors of the local economy?
Agriculture had a great year in 2016 and there are some mega electricity generating solar farms on the horizon and with the recent rain, it is looking good for this year.
Several weeks ago BHP Billiton Mitsubishi Alliance announced the investment of US$204 million in the Caval Ridge Southern circuit capital growth project.
It is an 11-kilometre overland conveyor system, which will transport coal from Peak Downs mine to the coal handling preparation plant at Caval Ridge.
This will create about 400 construction jobs and then about 200 ongoing operational jobs. It is due to start in a couple of months and will take 18 months to complete.
With the current demand and price for coal, we will again see some of the junior miners getting approvals for projects like Olive Downs. Also, the State Government has confirmed that the Blair Athol Mine at Claremont will be re-opened by Orion Mining next month (June 2017), creating hundreds of jobs. It is expected to create 600 jobs for the region according to Chairman, Jim Soorley.
Renewed Confidence
Renewed confidence has been reflected in my business with an increase in Self Managed Super Fund enquiries since the Federal Labour Party announced they will change negative gearing and stop SMSFs investing in property if they win the next election. People like to have job certainty and confidence in the economic outlook before making investment decisions.
Steve Taylor
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At the helm of Steve Taylor & Partners, Steve Taylor has been delivering expert advice and product knowledge to clients for over 30 years. Steve Taylor & Partners provide individuals, couples and families with the right strategies to create wealth and change their lives with solid bricks and mortar.
DISCLAIMER
Steve Taylor & Partners blog is opinion and not advice. Readers should seek their own professional advice on the subject being discussed. The figures stated in this article were accurate at the time of publication. For up to date figures, please contact our office.
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