Western Australia has always been a fast-moving, entrepreneurial, and successful state. Blessed with an abundance of natural resources, a thriving agricultural sector, and people with go-ahead attitude, WA has much to celebrate as the 2010s draw to a close.
Now is the time to take stock and consider the challenges and opportunities that WA has as we prepare to enter the first year of a new decade.
CHALLENGES
Red Tape
The first challenge for the West Australian economy is to cut red tape.
My recent research found WA regulations placed nearly 108,000 restrictions on businesses, organisations, and individuals. The restriction count is comparable to the Eastern States, even though they have far bigger populations than WA. There is significant work to do be done to cut the red tape burden that is weighing the economy down.
The Government has taken positive steps to cut red tape. Its willingness to work with the Federal Coalition has delivered positive results. Establishing a "one-stop shop" for environmental approvals will fast track investment in the resources sector by removing the onerous process of dealing separately with both State and Federal regulators.
Its Streamline WA project has also raised the profile of red tape reduction. The challenge now is for the government to deliver reductions that unleash the WA economy.
Green Activism
The second major challenge is to fend off the continual attempts by the green movement to undermine WA's resources and energy sectors.
The mining industry alone accounts for 40 per cent of the WA economy. Attempts by activists to shut down new mining projects through lawfare and boycotts must be resisted. The Environmental Protection Authority's plans from earlier this year to introduce a backdoor carbon tax through industry "contributions" to a carbon abatement fund has fortunately been quashed.
The Government needs to ensure that environmental policy does not take the state down an economically harmful route.
The WA Government should form sensible policy to allow the resources sector to flourish.
The move to allow fracking last year was a step in the right direction. However, the ban is still in place for 98 per cent of the state.
New gas projects will help drive down the cost of energy that is currently crippling the Australian economy.
Fair Share of GST
Thirdly, despite recent positive changes to the State distribution of GST, WA is still not receiving its share of revenue. Even with improvements, WA continues to subsidise economically underperforming states like South Australia.
West Australians should reap the full benefits of their strong economic performance and the WA Government should argue for States to retain 100 per cent of the share of the GST that they raise.
OPPORTUNITIES
Small Businesses
With red tape reduction on the cards, and the phasing in of small business tax cuts by the Federal Government, small business in WA is in a strong position to thrive. Small businesses account for 97 per cent of all businesses in WA and contribute over $48 billion to the State's economy. Small business growth promotes competition and creates employment opportunities. Favourable conditions for small business will allow WA to take full advantage of a strong culture of ingenuity and entrepreneurship.
Resources Sector
Next year will be another big year for the WA resources sector. The deal struck between Australia and the United States on mining rare earth materials will be a boon for the State's mining sector.
The ability to form new supply chains with the US offers Australia's mining industry a significant opportunity. WA has the resources to take full advantage of the new partnership. WA is already home to the largest rare earths producer outside of China, Lynas, which mines and processes rare earth oxides at Mt Weld, south of Laverton.
High iron ore prices have boosted Australia's mining exports and strong demand from Asia for Australian resources is likely to continue to grow in the new year.
The strong prices have resulted in higher-than-forecast Government surpluses, which have given the Government the opportunity to tackle the State's growing debt. While prices are expected to ease, the recent pickup in investment combined with moves to cut red tape in the resources sector will put the WA economy in a good position moving into the 2020s.
Sporting Capital of Australia
And finally, WA has the opportunity to turn Perth into Australia's new sporting capital in the new decade.
New and improved facilities will attract more sporting events. With the redevelopment of the WACA, the iconic wicket can play a greater part in world cricket. Optus Stadium has packed more Fremantle and West Coast fans in to create an even more hostile environment for the eastern clubs.
This should go a long way to boosting the odds of bringing a flag home to Perth in the 2020s.
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