Pathway to prosperity requires focus on strengths
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Perth does not need to overemphasise economic diversification to revitalise the local economy, but rather embrace its competitive advantages, according to a report released by the Committee for Perth today.
“When we started this project … we thought we were going to be standing up here two years later delivering an economic diversity strategy,” she said.
“In essence, the mining and resources sector is such a stalwart of our economy, we need to build off that rather than stick it to the side.
“We need to leverage the innovation which is happening in the mining and resource sector that is bringing in creatives and innovation that is beneficial to other industries.”
Mining was not the state's only strength, the report found, although it was the biggest one, with 32.65 per cent of gross value added in the state in 2017 attributable to the industry.
Professional services and the healthcare/social assistance industry in particular had grown their level of value creation in recent years, the report said.
"While WA has not diversified away from strong reliance on mining and resources, there is evidence of increasing diversity outside the mining and resource sector," the report said.
"... the mining sector itself has become more diverse and has expanded to deliver more to Perth than raw material exports.
"The sector has facilitated the emergence of a robust and skilled service sector and positioned Perth on the national and world stage as a centre of corporate power and a globally connected mining and resource knowledge and innovation hub."
Although the report was light on specific initiatives, it recommended a greater focus on international competitiveness and centralised strategic thinking about economic development.
“We need to reevaluate where the economy is heading,” Ms Fulker said.
A good example of where the state's economic policy had been incosistent was the recent introduction of a 7 per cent tax on foreign property buyers, at the same time the state was pitching to international students to make WA their destination of choice.
Two broader examples of how economic strategy could be rethought would be developing a brand for Perth, which could be distilled into a prospectus for investors, and creation of a state government task force to write-up a competitiveness strategy.
Further moves would be generating a long-term infrastructure strategy, similar to the planned Infrastructure WA, and a thought-provoking suggestion to drive greater use of data, artificial intelligence and sensors through smart city policies.
The big problem was pernicious underemployment, he said.
Mining was performing at a better that average level, but if that did not lift into another boom, there was a risk significant underemployment would continue, Mr Langoulant said.
That might mean younger Western Australians leave the city to head overseas or interstate.