Australia’s resource-rich states, NSW, and Victoria seemed to be unaffected by the mining wind down as they continue to post healthy economic growth. According to CommSec’s latest quarterly State of the States report, New South Wales was Australia’s best performing economy during the latest quarter with Victoria close behind.
The report is timely, coming just ahead of the Federal budget and a possible election in July. The bank analysed eight key indicators including economic growth, retail spending, equipment investment, unemployment, construction work, population growth, housing finance and dwelling commencements in ranking the states’ economies, reports The ABC.
Notably, the two states maintained a strong lead over the other states. NSW stood out for its best scores in population growth, retail trade, dwelling starts and unemployment. In housing finance, it was pushed down to the second place.
CommSec economist Savanth Sebastian harped on the strengths of Victoria in housing finance, retail spending, population growth and low unemployment figures. “It’s very likely that Victoria will edge even closer to New South Wales,” he said.
According to the economist, if the trend sustains, in six to nine months’ time, Victoria may overtake the NSW economy as the number one state economy.
In the report, the third and fourth slots went to ACT and Northern Territory while Queensland and Western Australia took the fifth and sixth positions. At the bottom was Tasmania with its improved rankings from the worst performing economy to take the seventh position along with South Australia.
Behind the glory of NSW, there is Sydney’s economy, which is also contributing heavily to Australia’s growth, according to economic experts.
In the last financial year, when most other cities and regions were struggling as mining boom retreated, Sydney was clocking decent growth.
In a report, SGS Economics and Planning said Sydney’s economy grew 3 percent in 2014-15 to $378 billion, which is nearly 23 percent of Australia’s gross national product, said a report in The Sydney Morning Herald.
“Sydney’s role as a global financial hub has allowed it to tap into the benefits of stimulus programmes undertaken by central banks around the world,” said the report’s author, Terry Rawnsley.
Sydney is the hub of financial services sector followed by other dominant sectors such as media, telecommunications, retail and real estate services.