The Queensland Government is now in caretaker mode until after the state election. Minimal updates will be made to this site until after the election results are declared.
Key global insights
Brisbane’s Stralis Aircraft is working with QUT and the iMOVE Cooperative Research Centre to retrofit a Beechcraft Bonanza aircraft and operate Australia’s first Hydrogen Electric Propulsion System (HEPS) powered flight during 2024. Stralis is aiming to retrofit an aircraft with HEPS for Skytrans to operate HEPS-powered commercial flights by 2026, helping to position Queensland as a hydrogen leader in line with the Queensland Hydrogen Industry Strategy.
Queensland producers are benefitting from tariff eliminations and reductions, including horticulture tariff reductions under the Australia-UK Free Trade Agreement (FTA), falling beef tariffs under the FTA with South Korea, and elimination of beef tariffs and seafood tariffs respectively under FTAs with the USA and Japan. Australia is also negotiating FTAs with the UAE and Gulf Cooperation Council (GCC), and a comprehensive agreement with India.
While some Queensland producers and farmers suffered severe impacts from recent adverse weather events (see separate section), producers in other parts of Queensland and Australia have benefitted from higher-than-expected rainfall. The Federal Government had forecast a 17% fall in farming exports during FY24 but has revised this to a 14% fall to $67bn. Cattle, sheep, cotton, rice and sorghum producers are amongst those who have benefited.
The war in Gaza threatens to escalate after Israeli drone strikes in Lebanon killed a senior Hamas leader in Hezbollah-controlled part of Beirut and a Hezbollah commander in southern Lebanon. Hezbollah, the Iranian-backed militia group, has said the attacks will not go unpunished. Should the war escalate, it could impact trade. Queensland’s top Middle East export markets are UAE ($390m YE Sept 23), Bahrain ($310m) and Oman ($276m).
Despite a US-led task force aiming to provide merchant vessels with safe passage through the Red Sea to the Suez Canal (which handles 12% of global trade), Yemen-based Houthi rebels have continued their attacks on ships, with the US and UK launching strikes in response. It comes as container prices increased 61% in the week to 4 January to $2,620. However, EIU analysts expect the price spike to be temporary, with limited supply-side inflation impacts.
Against the backdrop of historically low investment by Australian firms, the RBA has released a paper examining the link between monetary policy and non-mining investment. It found that contractionary policy makes Australian firms less likely to invest (and lowers the amount if they do), with the greatest impact felt by sectors most dependent on external finance
Featured insights
Severe Weather Recovery
- The Queensland and Federal Governments are delivering funding to help Far North Queensland recover from ex-Tropical Cyclone Jasper and South-East Queensland from storms.
- A $64m recovery package has been unveiled for FNQ ($25m each for primary producers and small businesses/not-for-profits, $9m for councils, $5m for tourism recovery).
- Further assistance will be provided with a $24.25m for FNQ tourism recovery and a $20 million clean up program for both regions.
DP World Industrial Action
- Dockers affiliated with the Maritime Union of Australia (MUA) have continued industrial action at DP World ports (including Brisbane).
- Amidst ongoing negotiations about salaries and conditions, workers have taken action including work stoppages and delays.
- DP World terminals account for 40% of Australia’s port capacity. The Freight and Trade Alliance estimates the action is costing the Australian economy $20 million per day.
- DP World says a backlog of 44,000 stalled containers would take 2-8 weeks to clear.
In case you missed it...
- JP Morgan’s Outlook for 2024.
- McKinsey’s most recent Global Economics Intelligence update.
- QTC Economist Michael Anthonisz answer ‘4 Questions for 2024’.
- Upcoming launch of the launch of the 2022/23 Australian Horticulture Statistics Handbook.
- Austrade’s weekly economic update - subscribe here.