Quarterly Economic Snapshot - July 2021
The Townsville North Queensland Economic Snapshot, in partnership with James Cook University and AEC, provides a regional economic outlook and commentary with key quarterly statistics including unemployment, business confidence, building approvals, property, and tourism.
Since the last economic snapshot in February 2021, the IMF have further upgraded their forecast for global GPD growth. Up from 5.5% to now 6% worldwide for 2021. Additional fiscal support in key countries and better than previously expected vaccine-rollouts bolster economic growth this year and beyond (4.4% GDP growth forecast for 2022).
Australia is in a good position to benefit from global growth—particularly through its mineral exports, which currently puts upward pressure on the Australian dollar. However, for other important sectors in our economy to benefit from global growth (think education, tourism), the federal government needs to devise an exit strategy out of border closure intended to stop the import of Covid. The speed and coverage of the vaccination roll out will be leading.
In the region, business confidence remains high even after the expiration of JobKeeper support, which also transpires in a continued downward trend in regional unemployment. Unemployment is now half the level it was at in 2016. That is a remarkable recovery in the last five years or so. We observe a similar development in the regional property market, with very low (rental) vacancy rates and resultant increases in residential building value.
Turning to our export markets, we note strong sugar prices, but the higher Australian dollar may dampen that price in the future. We also observe continued high beef prices and soaring copper prices as a result of the role copper plays in cleaner energy technology.
Performance in tourism in the region remains subdued. It likely requires the end of Covid and the subsequent opening of international borders for there to be some normalcy in that industry.
Dr Riccardo Welters
Associate Professor in Economics / Head Economics and Marketing
College of Business, Law and Economics
James Cook University
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