Queensland continues to fall behind in economic recovery
Commonwealth Bank Chamber of Commerce & Industry Queensland Pulse Survey of Business Conditions for the December Quarter 2009
1 February
Queensland businesses entered 2010 with much greater confidence than 12 months ago but remained behind the 8 ball compared to businesses located elsewhere in Australia, according to the latest Commonwealth Bank CCIQ Pulse Survey of Business Conditions.
Queensland's most comprehensive survey of business conditions showed 47 per cent of Queensland businesses expect the Queensland economy to strengthen over the next 12 months compared to just 8 per cent in the corresponding quarter of the previous year.
Business confidence was significantly greater for the national economy with 61 per cent of Queensland businesses confident that the national economic conditions would improve over the next 12 months.
Sales and revenue improved incrementally with 43 per cent of businesses reporting stronger sales and revenue over the three months to December but failed to meet the strong expectations business had predicted for the quarter.
However improving sales failed to convert to stronger profits with more than 60 per cent of businesses reporting weaker or equal profits in the December 2009 quarter.
CCIQ President David Goodwin said Australia's stellar economic performance compared to the global trend continued to instil business confidence and drive Australia's economic recovery.
"Overall the survey showed that trading conditions and business confidence have further improved over the December quarter," Mr Goodwin said.
"While this is a significant improvement a concerning trend is the continued lag in Queensland's economic recovery and the disconnect between confidence and actual business performance in Queensland.
"Businesses are right to be asking why their expectations are not being met and why confidence in Queensland's economy is not as high as confidence in the national economy.
According to Queensland businesses poorer confidence in the State economy can be attributed to:
- Queensland's dependence on the resource sector and other exports which places greater importance on a global economic recovery;
- The high value of the Australian dollar at present which poses a greater problem for Queensland exporters, tourism operators and the economy more broadly; and
- Confidence in the Queensland Government as a result of increased government debt, asset sales, loss of the state's AAA credit rating, perceived compromised liveability in SEQ, Australia's highest unemployment rate and rising utility costs.
"The strategies of the current government are clearly not delivering the economic growth that has characterised the past decade. The Chamber calls on the State Government to look at constructive ways of untangling the red tape and tax burden that stands between business and the historical boom status of Queensland," Mr Goodwin said.
Commonwealth Bank General Manager Corporate Financial Services Queensland, Mark Toon, said while business confidence continues to grow in Queensland; it is still lagging behind the state's confidence in the national economy.
"Although it is encouraging to see that business sentiment is much higher than this time last year, Queensland business owners are taking much longer to restore their confidence in the economy when compared to their outlook for the Australian economy.
"Queensland businesses remain sceptical about what the economic future holds due to our strong dependence on the resources sector. What's more, our exporters and tourism operators are finding operating conditions tough due to the resilient Australian dollar," Mr Toon said.
785 businesses completed the Commonwealth Bank CCIQ Pulse Survey of Business Confidence. This is the most comprehensive survey of Queensland business.
Related links
Media contact
Nick Behrens
Chamber of Commerce & Industry Queensland
t: 07 3842 2244
