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Economic Outlook
The Mount Isa-Townsville Economic Zone (MITEZ) is a nationally important economic zone with considerable growth potential. Over recent years, the MITEZ regional economy has consistently outperformed State and National growth averages, recording annual average growth of 9.9% between 2002-03 and 2006-07.
The major drivers of the MITEZ economy are base metal mining (Mount Isa and Cloncurry) agriculture (Cloncurry, McKinlay, Richmond, Flinders, and Charters Towers), mineral processing, manufacturing and defence (Townsville). These key sectors are economically synergistic in their relationship, with the Townsville to Mt Isa road and rail transport corridor crucial to their prosperity and future economic growth.
Looking ahead, steady GRP growth is forecast for the MITEZ region with 2006 AECgroup modelling forecasting GRP to grow by up to 5.0% per annum, reaching between $14.4 billion and $17.1 billion by 2010-11. The majority of short-term growth is forecast to occur in the Manufacturing and Mining sectors.
Source:
AECgroup
At present mining continues to prosper as commodity prices remain at record highs, driven by increasing world demand over recent years. However the current global economic downturn has the potential to adversely impact the mining and manufacturing of minerals. This outlook is of particular importance to the MITEZ Region where the Mining and Manufacturing sectors account for over 40% of GRP.
The long-term prosperity of the region is dependant on the ability to prove sufficient economic mining deposits into the future. Currently only one mine is slated to remain operational post 2016 and the proving of new copper, lead, silver, and zinc deposits is required to extend the life of mining beyond ten years. In particular the exploration of gold in Charters Towers needs to be accelerated as supplies deplete faster than discoveries are made. However the region is considered to have further resources, and the mining industry expects new mines to be developed into the future.
At the manufacturing end these developments are of great importance because mining is responsible for a large slice of manufacturing (mineral processing) in the Townsville area. One potential growth area is the establishment of advanced manufacturing in the region which will provide an avenue to further diversify the regional economy.
The defence force is healthy and growing in presence in the MITEZ region. Defence spending remains high in the MITEZ region and the sector is preparing to accommodate more personal and equipment.
The outlook for MITEZ regional employment continues to be good, buoyed by a healthy economy. The region is diverse and not as sensitive to shocks as many other regions. The steady decline in agriculture is of concern however relatively rapid recovery is possible, particularly with the recent boom in agricultural commodity prices. Agriculture is of particular importance to the region because it accounts for over one third of employment in the McKinlay, Richmond and Flinders LGAs.
Overall the economic outlook for the region remains optimistic. MITEZ will continue to profile and market the region to investors and trade partners in an active partnership approach, committed to the continued prosperity of the MITEZ region.
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