Qld reopening proceeding despite state gov’t generating confusion about entry requirements

Queensland tourism operators would have breathed sighs of relief yesterday after it emerged interstate travellers could rely on PCR tests paid for by Medicare to enter the state. This came after some confusion and anxiety generated by the state government about whether travellers would have to pay for them. Federal health minister Greg Hunt is right to demand an apology from the Queensland Premier for the “unnecessary stress she has caused to Queenslanders and those planning to travel there” (see this Courier-Mail report). Queensland is well-placed to have a strong 2022 as interstate tourism is revived, but the Queensland Government could still stuff things up through incompetence and panicked policy responses. 

Queensland’s big test will come after 17 December when we reopen to NSW and Victoria and COVID comes in. Will our health system cope with the COVID case load, particularly with possibly thousands of unvaccinated staff unable to work, as suggested by this Sky News report? Of course, Queensland’s good weather and low population density will help slow the spread of COVID as it has in the past, so let’s hope those factors and our relatively high vaccination rates in many parts of the state keep us out of trouble (see the heat map of first dose vax rates below thanks to Adept Economics Research Officer Ben Scott). The SW-Queensland border town of Goondiwindi stands out with a first dose rate of 95%+.

Heat map of first dose vax rates for Qld regions showing Goondiwindi in the lead at 95%+. NB data are unavailable for much of the Queensland Outback and Cape York.

I was concerned about provincial cities such as Townsville, Cairns, Rockhampton, Mackay, and Bundaberg, but first dose vaccination rates there are all over 80%. For first doses, Townsville is at 83.1%, Cairns is at 85.9%, Rockhampton is at 82.1%, Mackay is at 86.4%, and Bundaberg is 88.5% (for the data go to COVID-19 vaccination – Geographic vaccination rates – LGA). Bundaberg is actually beating Brisbane which is at 87.2%. I’m hopeful the vax rates we’re seeing in these cities will mean local hospitality businesses won’t suffer hugely from having to turn away unvaccinated customers after 17 December, a state government policy which I think is absolutely wicked and over-the-top, for the record. 

We see lower vax rates in some remote areas, probably because locals perceive the risk of getting COVID is low. Most worryingly we see some very low rates in Indigenous communities such as Cherbourg (57.4% first dose rate) and Yarrabah (60.2%). We could have a major public health disaster if COVID gets into some of our Indigenous communities given the high prevalence of chronic health conditions. 

Please feel free to comment below. Alternatively, you can email comments, questions, suggestions, or hot tips to contact@queenslandeconomywatch.com. I also post from time-to-time on my business website adepteconomics.com.au, so please consider subscribing to updates there (Get in touch). Also please check out my Economics Explored podcast, which has a new episode each week.

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PM calls jobs boom, RBA warns of crypto crash, and UK inflation highest in 10 years – upcoming livestream

As I’ve been covering on QEW and will discuss on today’s livestream (link above), there’s a lot of exuberance and optimism about the great Aussie reopening, and PM Scott Morrison has forecast a “jobs boom” based on healthy job vacancies data (see the chart below).

We’re hearing calls from business groups to resume high levels of immigration to help fill vacancies and address skills shortages and, implicitly, to put downward pressure on wages growth (e.g. see Increase skilled migration to 200,000 per year, says leading business group). I suspect we’ll see a vigorous debate in coming months about whether we return to previous levels of immigration or instead opt for lower levels which would place less pressure on services and infrastructure and would be easier to absorb into the labour market.

In today’s livestream, I’ll also cover accelerating inflation in the UK, where the 4.2% through-the-year inflation rate recorded in October was the highest in 10 years (see chart below).

We’ll also cover the RBA’s warning about cryptocurrency earlier this week (see RBA warns of ‘faddish’ crypto crash). Crypto prices have been falling this week (see chart below), reminding us of their volatility and the unreliability of cryptocurrencies as stores of value. Of course, they have proven to be extraordinarily successful investments for many people, but we should remember that investing in crypto is akin to gambling.

Please feel free to comment below. Alternatively, you can email comments, questions, suggestions, or hot tips to contact@queenslandeconomywatch.com. I also post from time-to-time on my business website adepteconomics.com.au, so please consider subscribing to updates there (Get in touch). Also please check out my Economics Explored podcast, which has a new episode each week.

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Tourism operators need Qld Gov’t to continue reopening and not to panic as COVID comes in

There is a lot of excitement about the reopening of Queensland, which can’t come quickly enough, but at least it is actually happening, so long as the Queensland Government holds its nerve and doesn’t reimpose restrictions once COVID cases start rising. Tourism operators in particular need a strong Christmas-New Year period to help make up for big losses since March last year (see the chart below). Operators appear optimistic, thankfully. According to the Courier-Mail, several Queensland tourism operators are on a hiring spree as they prepare for the Christmas-New Year period “after a disastrous 18 months” (see Thousands of jobs on offer at Queensland’s biggest tourism operators). 

While international tourism has been practically non-existent, and the Queensland industry has lost nearly $6 billion of turnover associated with international tourists, domestic tourism spending in 2021 was tracking reasonably well in Queensland up until July and August when interstate border restrictions came in. Various reports suggest that, even though Queenslanders were able to travel for September school holidays, interstate border restrictions did adversely impact many operators. See Some Gold Coast businesses face ‘shocking’ school holidays, others say outlook is sunny and Far North Queensland tourism not bouncing back, school holiday numbers worse than expected. Incidentally, the state government’s tourism vouchers scheme has appeared to have fallen short of its objectives (see 42,000 winners fail to redeem Qld holiday vouchers aimed at boosting tourism).

My best guess at this stage is that domestic tourism spending in Queensland will end up at around $17 billion in 2021 compared with $19.5 billion in 2019. Taking into account almost non-existent international tourism spending, which shrank from $6 billion to $200 million per annum, the Queensland tourism sector, in 2021, has been operating on only two-thirds of the turnover it had pre-COVID. 

I really hope the Queensland Government doesn’t panic. Currently, the state is in a good position to recover further from the pandemic. The October Labour Force data released by the ABS last week showed Queensland leading the states in terms of the level of employment relative to the pre-COVID level (see the Queensland Treasury briefing and the chart below). 

I’d prefer the state government to open up the state earlier than currently planned, and not to proceed with its de facto vaccine mandate which will cost hospitality businesses some trade (e.g. see Central Queensland business owners ‘in tears’ over looming COVID restrictions, meeting organiser says), but I am very pleased that we are reopening, albeit if a little bit too slowly.  

Please feel free to comment below. Alternatively, you can email comments, questions, suggestions, or hot tips to contact@queenslandeconomywatch.com. I also post from time-to-time on my business website adepteconomics.com.au, so please consider subscribing to updates there (Get in touch). Also please check out my Economics Explored podcast, which has a new episode each week.

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Lithium and the new energy revolution – my latest podcast episode

The modelling for the Australian Government’s Long-Term Emissions Reduction Plan has been published and, while the report makes bold and arguably fantastic assumptions about future progress, it does contain some very useful information and commentary on various technologies relevant to decarbonisation. One important technology is the lithium-ion battery and the modelling report notes on p. 20: ” Lithium-ion batteries are the cheapest form of grid-scale battery storage currently available. Costs are expected to fall further thanks to manufacturing scale up driven by the rapidly growing electric vehicles market.” There is a lot of excitement in industry about lithium, and let’s hope industry is right, so we can cheaply store all the new intermittent energy being generated by wind and solar, and we don’t end up with an unreliable electricity grid with regular brownouts and blackouts.

One industry expert who is very enthusiastic about lithium is UK-based Lukasz Bednarski, a battery materials analyst and a former commodity trader. In Economics Explored episode 113, I interview Lukasz about his new book Lithium: The Global Race for Battery Dominance and the New Energy Revolution.

In his book, Lukasz describes:

How a little-known mineral will affect our jobs and daily lives as much as, if not more than, AI or Big Data have done.

It’s a fascinating mineral to learn about: lithium, the third element on the periodic table and the lightest metal and solid (under standard conditions), so please check out my podcast interview with Lukasz and consider picking up a copy of his book.

Cover of Lukasz Bednarski’s new book: Lithium: The Global Race for Battery Dominance and the New Energy Revolution.

Please feel free to comment below. Alternatively, you can email comments, questions, suggestions, or hot tips to contact@queenslandeconomywatch.com. I also post from time-to-time on my business website adepteconomics.com.au, so please consider subscribing to updates there (Get in touch). Also please check out my Economics Explored podcast, which has a new episode each week.

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GoMA inequality seminar + Keith DeLacy book launch = awesome upcoming events

I’m honoured to be one of the panellists at an upcoming University of Queensland Global Leadership Series seminar on Poverty and inequality in an age of prosperity. Joining me are former Queensland state Treasurer Tim Nicholls MP, Karyn Walsh AM, CEO of Micah Projects, and Joshua Creamer, a nationally-practicing lawyer specialising in class actions and native title. The panel discussion will be chaired by hardman former journalist Peter Greste who endured many months as a political prisoner in Egypt over 2013 to 2015. Here are some of the other details from the website (linked to above):

According to Credit Suisse, Australia is the world’s most prosperous country. Why then, are some communities mired in poverty?
In a world of increasing austerity where social services are under growing pressure, it is urgent that we re-examine the responsibility of the state towards its most disadvantaged citizens.
Join UNESCO Chair in Journalism and Communication, Professor Peter Greste, for a thought-provoking discussion on poverty and inequality with a panel of leading experts:

Date: Thursday 25 November 2021
Time: 5.30pm for 6-8pm
Venue: GOMA, Cinema A, Stanley Place, South Brisbane
Cost: Tickets $30
Ticket includes canapés and beverages

Another awesome upcoming event is the book launch for Keith DeLacy’s autobiography, being hosted by the Australian Institute for Progress on Thursday 18 November at the Brisbane Club from midday. Check out the details regarding the event and how to book at the AiP’s website. Keith was one of the all-time great Queensland Treasurers and was a huge help to me when I was writing my history of Queensland’s public finances since Sir Joh Bjelke-Petersen and Sir Leo Hielscher, Beautiful One Day, Broke the Next. Alas, I have another commitment that day, but I’d highly recommend the book launch, because Keith has lots of good stories and valuable perspectives. Plus the food and drink at the Brisbane Club is first class.

GoMA on the south bank of the Brisbane River, next to the weird looking Kurilpa bridge.

Please feel free to comment below. Alternatively, you can email comments, questions, suggestions, or hot tips to contact@queenslandeconomywatch.com. I also post from time-to-time on my business website adepteconomics.com.au, so please consider subscribing to updates there (Get in touch). Also please check out my Economics Explored podcast, which has a new episode each week.

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Billionaire and inheritance taxes podcast chat with Prof. Miranda Stewart

There are growing calls to increase taxes on the wealthy in advanced economies such as the United States and Australia. For instance, US Congresswoman Alexandria Ocasio-Cortez controversially wore a white evening dress with the words Tax the Rich written in red across it to the 2021 Met Gala. To get an informed and objective view on taxing the wealthy, I invited Professor Miranda Stewart from the University of Melbourne Law School onto my Economics Explored podcast for Episode 112 Taxing the Rich – Billionaire and Inheritance Taxes. Miranda is the Director of the Tax Group at the Law School, and she is also a Fellow at the Tax and Transfer Policy Institute at the Crawford School of Public Policy, the Australian National University.

I reached out to Miranda after I read her comments in an Australian Nine media article titled Death duties: Why experts think this tax should be re-introduced. We haven’t had death duties in Australia since Sir Joh abolished them in Queensland in the seventies and other states followed his lead. I expect there will be growing pressure to re-introduce politically unpopular death duties in Australia over the coming decades, particularly given what John Quiggin has labelled The coming boom in inherited wealth. This is definitely an issue to watch.

Prof. Miranda Stewart, University of Melbourne Law School

Please feel free to comment below. Alternatively, you can email comments, questions, suggestions, or hot tips to contact@queenslandeconomywatch.com. I also post from time-to-time on my business website adepteconomics.com.au, so please consider subscribing to updates there (Get in touch). Also please check out my Economics Explored podcast, which has a new episode each week.

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ABS reveals big impact of lockdowns on retail trade + today’s livestream link

Let’s hope the Queensland Government doesn’t impose a lockdown in response to the new cases coming out of Goondiwindi, as the ABS’s estimates of retail turnover for September quarter show us once more the large adverse impact that lockdowns have on retail turnover (e.g. see Lockdowns see record 4.4% fall in quarterly retail sales and the chart below for the major states). As I’ve commented before, Queensland has been performing much better than the states which were locked down the longest. Queensland’s retail trade (in real terms) was up 0.2% in September quarter, which is probably consistent with state population growth running at under 1% per annum at the moment (see this ABS report). I suspect retail trade in Queensland would have grown much faster in September quarter if it weren’t for the short SEQ lockdowns we had in July and August and various interstate travel restrictions. Consider that WA was up 4.1%, SA was up 1.7%, and Tasmania was up 2.2%, in terms of retail trading volumes in September quarter.

I’m livestreaming my latest Economics Explored Live show later today, at 11.30am Brisbane time, and you can watch me via YouTube if you’d like to watch:

Please feel free to comment below. Alternatively, you can email comments, questions, suggestions, or hot tips to contact@queenslandeconomywatch.com. I also post from time-to-time on my business website adepteconomics.com.au, so please consider subscribing to updates there (Get in touch). Also please check out my Economics Explored podcast, which has a new episode each week.

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Gov’t says COVID “enduring emergency” – “temporary” powers will be in place longer than two years

As expected, the Queensland Government has brushed off One Nation MP Stephen Andrew’s e-petition to “Restore Democracy in Queensland”, citing the “enduring emergency” from COVID-19. The Government still claims the emergency powers it gave to the Chief Health Officer in early 2020 are “temporary”, although by the time they expire on 30 April 2022 they will have been in place for over two years, and who is to say they won’t be extended again? How’s that for “temporary”? For information, here is a link to the Health Minister’s response to the e-petition which was circulated to people who signed the petition:

Qld Health Minister’s response to Restore Democracy in Queensland e-petition

I was a supporter of the petition (e.g. see my 21 July post), and I originally spoke out against the perpetual extension of “temporary emergency powers” back in January (e.g. see my 14 January post), because what the Government has done over the last 18-20 months has clearly breached traditional norms of parliamentary democracy. While our state government has been nowhere near as bad as Victoria’s, it has still enacted undemocratic measures and has treated people locked out of Queensland, including many Queenslanders, with cruelty. The Government claims it is all for the greater good, but I expect many more of us will come to doubt that as the years pass. Gigi Foster and Paul Frijters make a strong case that many countries, including Australia, were overcome by a wave of panic last March in their excellent book The Great COVID Panic, co-authored with Michael Baker.

We now await the inevitable spread of COVID in Queensland, particularly in our regions with low vaccination rates (e.g. Mackay, Rockhampton, parts of FNQ, and the Gold Coast relative to Brisbane). Will our stressed public hospital system cope? Will the Government impose regional lockdowns, threatening the viability of hospitality businesses if they can’t trade over the holiday period? I really don’t know, but I know senior people in industry are worried. I spoke at Capricorn Enterprise’s Major Projects Forum in Rockhampton last Thursday and QRC boss Ian Macfarlane gave an impassioned plea for people in regional Queensland to get vaccinated, as did Robert Sobyra from Construction Skills Queensland. Broadly speaking, Queensland’s economy has been recovering better than expected, but there’s always the chance of the Government imposing some new lockdowns as COVID spreads, setting us back again.

Qld Parliament House, corner of Alice and George Streets, Brisbane City.

Please feel free to comment below. Alternatively, you can email comments, questions, suggestions, or hot tips to contact@queenslandeconomywatch.com. I also post from time-to-time on my business website adepteconomics.com.au, so please consider subscribing to updates there (Get in touch). Also please check out my Economics Explored podcast, which has a new episode each week.

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Decarbonising the Qld economy seminar at HopgoodGanim on 9 November

Decarbonising the economy to address climate change will disproportionately impact Queensland relative to the rest of Australia, particularly given the importance of coal mining to some of our regional economies and to our state Treasury through royalties. I’m holding a seminar on Decarbonising the Queensland Economy on Tuesday 9 November (from 4.30pm for 5pm commencement of presentation) at HopgoodGanim Lawyers, Waterfront Place, Brisbane.

The seminar will be held in conjunction with Effective Governance, HG’s corporate governance practice, and will include some words from the EG CEO Cate Jolley. Drinks and canapes will be provided. You can book via the Eventbrite page for the event:

Decarbonising the Queensland Economy – Briefing and discussion

The seminar presentation (by me) and following discussion will consider a range of complex issues, including:

  • Which Queensland industries and major companies will be most impacted by decarbonisation?
  • How should company boards be preparing for decarbonisation?
  • What is the future for coal mining and coal-fired power in Queensland and how will regions adapt to future structural change?
  • Will structural adjustment assistance be required for the most-affected regions (e.g. Biloela and Bowen Basin mining communities)?
  • What are the implications for agriculture in Queensland, particularly given cattle are a substantial source of greenhouse gas emissions?
  • How rapidly can renewables replace coal-fired power given their implications for the reliability of the electricity network? Will battery technology prove sufficient in conjunction with renewables to ensure reliable and cost-effective power? Or will we need to consider other technologies (e.g. pumped hydro or nuclear)?
  • What are the real prospects for Queensland developing a hydrogen economy?

Please come along if you’re interested and available. I’d love to see you there.

Wind farm, near Atherton, North Queensland.

Please feel free to comment below. Alternatively, you can email comments, questions, suggestions, or hot tips to contact@queenslandeconomywatch.com. I also post from time-to-time on my business website adepteconomics.com.au, so please consider subscribing to updates there (Get in touch). Also please check out my Economics Explored podcast, which has a new episode each week.

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Senator Canavan explains why he opposes Net Zero by 2050 in my latest Economics Explored episode

In Episode 111 of my Economics Explored podcast, Queensland Senator Matt Canavan explains why he opposes the Net Zero greenhouse gas emissions by 2050 objective. We have a wide-ranging conversation covering COP26, nuclear energy, hydrogen, China, the US political situation (particularly Joe Manchin) and what that means for US climate change policy, and the outlook for coal, among other issues. On hydrogen, Matt tells a great story about Queensland’s short-lived attempt to develop a hydrogen industry in the eighties, involving Sir Joh and a hydrogen-powered car which, according to Sir Joh, relied on a nuclear fusion reaction! I’ve included a link to the Seven News retrospective on that incident in the show notes which you can access via the link above.

On my business website, I’ve also published a transcript which was originally generated using the AI transcription service Otter and which has been edited to fix up transcription errors.

Please feel free to comment below. Alternatively, you can email comments, questions, suggestions, or hot tips to contact@queenslandeconomywatch.com. I also post from time-to-time on my business website adepteconomics.com.au, so please consider subscribing to updates there (Get in touch). Also please check out my Economics Explored podcast, which has a new episode each week.

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