Far North Queensland businesses say infrastructure is key to growth

Wednesday 17 October | Categories: Economic Policy, Infrastructure and Planning

At a recent forum held in Cairns, local businesses were invited to have their say on the future of the North Queensland economy with CCIQ (Chamber of Commerce & Industry Queensland).

In recent times, the Far North Queensland economy has faced many challenges with areas such as Cairns suffering from the global downturn in tourism, being balanced by growth in resource opportunities and a strong agriculture through the Tablelands out to Mt Isa.

As a region, the Far North is potentially at the forefront of leading Queensland’s charge into the Asian century, through close proximity, amazing lifestyle opportunities and commercial potential, but a real emphasis on infrastructure and skills is needed to maximise the opportunities.

In addition, as custodians of many of Australia’s greatest environmental assets, the Far North is facing a genuine need to balance commercial opportunities with the responsibility to conserve, protect and nurture our unique natural environment.

CCIQ General Manager of Advocacy, Nick Behrens, said, "Far North Queensland is a region with a strong economic future, but the overwhelming feedback from businesses was that in order to continue to grow, investment in infrastructure and freedom from the burdens of red tape and bureaucracy are required."

"Time and time again, businesses informed CCIQ that improvement to the airport, and port is required from a passenger and freight perspective to truly open up the Far North to tourism and business opportunities.

"Whilst CCIQ appreciates that investment during a tough state budgetary period is difficult, we believe that the rewards for Cairns and the Far North region would be significant in terms of employment and commercial growth.

"At the same time, local businesses are fully aware that growth must be managed, sustainable and balanced to ensure that the Far North’s unique assets such as the Barrier Reef, Daintree and Cape York are not exploited in a way which destroys our environmental legacy."

CCIQ will work to create an economic blueprint for Far North Queensland that will outline the steps that all levels of government can take to ensure that businesses in Far North Queensland continue to grow, creating wealth, opportunity and employment across the region’s communities.

STRENGTHS OF FAR NORTH QUEENSLAND ECONOMY

It was agreed that there are many positive attributes to the FNQ economy/region including cultural diversity, proximity to international markets, affordable living and housing, community services and infrastructure and lifestyle factors. On top of this a positive business atmosphere exists and should be promoted more in the media and through Government channels.

CRITICAL ISSUES

TRANSPORT INFRASTRUCTURE, SERVICES AND COSTS

• Limited options for transport which places pressure on the existing infrastructure and is the basis for the ongoing need for upgrades and flood-proofing to maintain good connectivity both within the region (domestic/regional/local roads) and with other regions (national road, rail, air, and sea systems/routes).
• Complete lack of diversification/options available for shipping and freight which increases the cost of doing business in FNQ, decrease price competiveness and limits access to new/emerging markets.
• In terms of the airport infrastructure, it is an issue that the airport is being ring-fenced for tourism and that its current capacity is exhausted by passenger planes reducing the ability to better utilise the airport for shipping and freight.

ENVIRONMENTAL REGULATION AND CONSTRAINTS

• Perception/reality that environmental assets are given higher value in FNQ than in other regions impacting on development, investment and flexibility of businesses.
• Many examples of where the existing restrictive and uniform approach to environmental management and conservation is preventing uptake of new opportunities/entry into new product markets.

GOVERNMENT REGULATION AND COMPLIANCE

• Widely held view that many decisions are made in Brisbane without appreciation for the regional context and business environment. Key regulatory areas causing most burden/cost are WHS, Payroll Tax and Stamp duties, complexity of many of the awards.

ACCESS TO FINANCE AND LENDING CONSTRAINTS

• Banks are reluctant to lend to business in FNQ due to inaccurate perceptions of economic risk linked directly to the natural disasters and tourism industry. Banks/Lenders do not have an on the ground understanding about the broader economy and strength of the FNQ region.
• Businesses noted particular difficulty in accessing funds for business investment, land development, housing and property developments and other medium sized projects.
• Greater flexibility and improved understanding of the economic environment by the lenders is needed in order to attract major projects, investment in new industries and for local/regional business growth/diversification.
• It was recognised that the infrastructure that is needed is already present and the business community is ready to move forward, however the greatest barrier/challenge is the investment and people/businesses willing to take a risk on the emerging opportunities.

DIVERSIFICATION AND EXISTING INDUSTRIES

• Greater focus is needed on supporting and strengthening the industries (other than tourism) that already exist in the economy. Many sectors have strong foundations, existing infrastructure and many opportunities for expansion into new markets/products if targeted support was provided (E.g. ICT, Agriculture, Fisheries, Marine, Community and Professional Services and Transport). These sectors are overshadowed by the tourism industry which seems to be the main focus of government policy and attracts the greater share of limited government funding.

SKILLS AND WORKFORCE

• Staffing across many industry sectors is challenge and retaining good workers is increasingly difficult as there is so much competition for committed/reliable staff. It was recognised that this is not entirely an issue about skills/training/qualifications, but more about work ethic and competition with major sectors and other regions.
• Attracting more young people to the region and promoting the benefits to families will alleviate some of the existing/emerging skills challenges. Employers need to look beyond cheap labour and place renewed focus on training and upskilling of their existing workforce (quality customer focused staff is identified as the key differentiation/attribute required to continue to service and attract southern and eastern Asian markets/customers who have very high service level expectations).

WHAT CAN BE DONE TO HELP FAR NORTH QUEENSLAND’S ECONOMY?

TRANSPORT INFRASTRUCTURE, SERVICES AND COSTS

• The transport system needs to be developed/expanded in order to support greater direct export into international and national markets instead of via Brisbane and Sydney so that the region can directly benefit from the income/revenue.
• The region desperately needs a strategy to review the current costs and limitations of transport, freight and shipping required to support industry development, diversification and product/market expansion.

ENVIRONMENTAL REGULATION AND CONSTRAINTS

• Needs to be greater recognition that FNQ businesses are committed to triple bottom line and recognise their obligation to protect the FNQ environment and that the government needs to work closer with the business community to develop mutually beneficial policy and regulatory outcomes, rather than simply restricting businesses through fees, licences and reporting requirements.

GOVERNMENT REGULATION AND COMPLIANCE

• There needs to be greater consideration by governments of the regional challenges and business operating environment when making legislative changes and that a ‘one size fits all’ approach does not work for the ‘disperse and diverse’ state/regional economies.

ACCESS TO FINANCE AND LENDING CONSTRAINTS

• It was recognised that the infrastructure that is needed is already present and the business community is ready to move forward, however the greatest barrier/challenge is the investment and people/businesses willing to take a risk on the emerging opportunities.

POSITIVE PROMOTION AND MARKETING

• Agreed that there are many positive attributes to the FNQ economy/region including cultural diversity, proximity to international markets, affordable living and housing, community services and infrastructure and lifestyle factors. These need to be promoted in order to attract investment and population mobility.
• The business community also needs to be batter at communicating who they are and what they do and the extent of their professional capabilities/technical expertise to state, national and international markets/investors so that they can attract the investment streams currently focused on capital cities.