Queensland Treasurer Curtis Pitt said the latest Investment Monitor released this week showed $152.2 billion worth of known investment projects in Queensland in the December quarter 2016.
"This continues to rank Queensland higher than our main interstate counterparts, particularly New South Wales which recorded $132.2 billion worth of projects and $68.2 billion in Victoria," Pitt said.
"Queensland remains second only to Western Australia in the value of major projects under way, committed, or proposed.
"The monitor showed the value of public and private projects in Queensland either under construction or committed totalled $36.4 billion. A further $74.6 billion worth of projects were under consideration and there were $41.2 billion more potential projects."
New projects in Queensland were added to the list for the December quarter, include:
- Genex Power's $110 million solar-hydro project to be built in north Queensland;
- The $70 million Novotel Hotel at South Bank in Brisbane; and
- The $25 million redevelopment of the Australia Fair shopping centre on the Gold Coast classed as under construction.
"The value of projects under consideration or possible rose by $843 million in the December quarter to $115.8 billion, with the inclusion of a number of projects," Pitt highlighted.
"These included the $512 million Logan Motorway Enhancement Project under the Queensland government's Market Led Proposals initiative, as well as the proposed $360 million Mount Emerald wind farm in Far North Queensland."
He added that the state government recognised that building infrastructure benefitted local communities, strengthened local economies and supported local jobs.
"That's why we're spending more than $40 billion on public infrastructure over the next four years, including a $10.7 billion capital program for 2016-17, which will support 31,000 jobs," Pitt said.
"Almost half of the 2016-17 capital works budget will be spent in regional Queensland to help boost local economies and generate jobs."
Deloitte Access Economics noted that the value of engineering construction work fell by almost a quarter over the year to September 2016, reaching the lowest levels seen since 2010.
"There was a significant fall in engineering construction in the last three months of 2016, and there's more to come, with a number of large gas projects scheduled for completion over the coming year," Deloitte Access Economics partner and report lead author Stephen Smith warned.
In fact, once the Gorgon, Prelude and Ichthys LNG developments come to an end this year, more than $100 billion of project activity will be removed from the database (see Chart 1).
"In the absence of new projects, this will see the value of our Investment Monitor database fall to its lowest levels seen since early 2009," Smith said.
He also pointed to one of the "big" stories of 2016 - gains in commodity prices particularly for coking coal and iron ore.
"This is good news for Australian commodity exporters, especially considering that much of the resources sector is now moving into the production phase," Smith said.
"That said, the long-term fundamentals for the mining sector remain relatively unchanged. While higher prices may linger they have been supported by temporary supply shortages, stimulus aimed at China's construction sector, and an unusually high level of investor speculation - none of which will last forever.
"The value of commercial construction has been broadly the same every year since the turn of the decade. More recently there has been an easing in activity, but better approvals data of late suggests that's unlikely to be a long term trend."
- The total recorded value of projects in the Investment Monitor database is $782.5 billion - a 3.5% decrease from the previous quarter, and around 20% below the peak of late-2012.
- The value of definite projects (those under construction or committed) decreased by $32.5 billion over the quarter, a 7.5% drop from September 2016.
- The value of planned projects (those under consideration or possible) grew slightly during the December quarter, adding $4.1 billion worth of projects to the pipeline - however, planned work fell by 3.8% over the year to the December quarter.