PricewaterhouseCoopers: Gross state product drops, stadium is key

A leading economist says the Territory will have to “adapt and change” to meet a $40b gross state product target by 2030.

THE plan to host an AFL team and build a 25,000 seat AFL stadium in Darwin has won support from leading economic consultants PricewaterhouseCoopers.

The global accounting giant says for the Territory economy to achieve the Government’s $40bn gross state product target by 2030, the city has to adapt and change.

Part of this would be making it attractive for families to move here and an AFL team would put Darwin in the same league as the states.

PricewaterhouseCooper’s Australian CEO Tom Seymour, who this week met with Government and private sector figures in the Territory, says innovation is needed to attract a workforce to Darwin.

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Tom Seymour, PwC Australia chief executive officer. Picture: Jen Dainer

To get families to move here you need schools and hospitals, but you also need lifestyle and recreation,” he said.

“A facility like a stadium is a great investment. If you look at is as a linear investment it doesn’t stack up, but it does if you want to create an environment where you attract people here.

“Lang Park in Brisbane, Adelaide Stadium, Optus Stadium. They were all criticised and were a struggle, yet not one of those projects was seen as a failure.”

The call came as new economic data reveals a dent to the Government’s economic forecasts.

The latest Australian National Accounts released Friday show the Territory’s GSP dropped 0.6 per cent – well short of the budget’s forecast of a 4.7 per cent increase in 2021.

The less volatile State Final Demand, which measures private and public expenditure and consumption but excludes the distorting effects of imports and exports, increased 6 per cent on the previous year and exceeded Treasury forecasts of a 4.2 per cent increase.

The fall in GSP is a cosmetic glitch in the Government’s target to grow the Territory’s economy to $40bn by 2030.

In financial year 2021 Territory GSP was $26.2bn, down from $26.3bn the previous year. The Territory’s highest GSP was $31.8bn in 2014.

Chief Minister Michael Gunner said GSP is volatile and influenced by imports and exports. “The comeback is on,” he said.

“We continue to smash the national average and big projects like Core and Santos, the ship lift and CDU in the CBD just keep driving new jobs.”

NT’S GROSS STATE PRODUCT DROPS, BUT AG GROWS

The Territory‘s gross state product suffered a surprise drop in the past financial year, despite key indicators showing the economy is strong.

The latest Australian National Accounts released Friday show the Territory’s GSP dropped 0.6 per cent – well short of the budget’s forecast of a 4.7 per cent increase in 2021.

It was also well down on the Territory’s national high 6 per cent GSP increase in 2020.

The Territory and Victoria were the only two jurisdictions last year to record a decline in gross state product, which measures overall economic activity including imports and exports.

The decline was mainly on the back of a 12.1 per cent drop in mining activity in 2020-21 reflecting volatile conditions for offshore gas producers.

On the positive side, agriculture, forestry and fishing value increased 23.8 per cent on the back of improved cattle prices and a fruitful mango season.

The less volatile State Final Demand, which measures private and public expenditure and consumption but excludes the distorting effects of imports and exports, increased 6 per cent on the previous year and exceeded Treasury forecasts of a 4.2 per cent increase.

Although on the back of international activity, the fall in GSP is a hit for the Government’s target to grow the Territory’s economy to $40bn by 2030.

The $40bn GSP target was identified as optimal by the Territory Economic Review Committee, which released an economic blueprint for the Territory in November 2020.

In financial year 2021 Territory GSP was $26.2bn, down from $26.3bn the previous year.

The Territory’s highest GSP was $31.8bn recorded at the height of the Inpex project in 2014.

NT Chamber of Commerce ceo Greg Ireland said the GSP figure does not fully reflect the economy.

“From our perspective we’re still seeing a growing bank of future work,” he said.

“We’re still concerned about the Territory’s ability to deliver on the expected surge in activity from future projects.

“We’re less worried about numbers now being impacted by local conditions, but in the future we can see there’s certainly a growing need to reinforce workforce capabilities and skills level and developing a skills base to deliver future opportunities.”