Commsec finds SA is now top-ranked on business investment

Southbank, Victoria, Australia — A recent study found there has been a 42 percent rise in failure rate across the nationwide startup sector. Mike Wilson/Unsplash

A new report has revealed that businesses in South Australia have a competitive advantage over their interstate counterparts. Business investment in SA rose by the highest amount in Australia during the March quarter, Commsec’s latest State of the States report finds.

Business spending on equipment reached 7.2 percent during the March quarter compared with the past decade. It surpassed all other territories and states. The figure rose to 19.3 percent over the past 12 months. It indicates a rise in investment albeit off a lower than average base.

Commsec chief economist Craig James said SA is now the top-ranked on business investment. “The South Australian economy is showing promising signs with investment lifting over the past quarter,” he added.

The country had a multi-speed economy with little to separate New South Wales, Victoria and the ACT. SA was in the middle group along with Tasmania, Queensland and the Northern Territory.

As for Western Australia, it remains as the worst performing state in Australia after the end of the mining boom. Spending on equipment fell by nearly 30 percent in WA during the June quarter. The WA government, in its attempt to boost the state’s economy, demands a bigger share of national GST revenue and tries to steal naval shipbuilding work from SA.

Overall, the country’s economy is doing well. “But it is clear that much of the momentum is being provided from Australia’s south-east with New South Wales, Victoria and the Australian Capital Territory leading the way,” James said, according to The Advertiser.

Competitive advantage of SA

An Australian Industrial Transformation Institute analysis compared quality of life, workforce costs and liveability with Victoria, Queensland, New South Wales and Western Australia. The report showed that living and working in SA was a better prospect than anywhere else in the country.

Trade Minister Martin Hamilton-Smith said the report showed the competitive advantage that the SA workforce offered several businesses. Since the Investment Attraction SA was established, more than $1 billion of investment have come in, with 13 projects and almost 4,800 jobs. Inghams, for instance, is a $275 million investment that generated 1470 jobs.

Hamilton-Smith said SA had every reason to be proud of what had been achieved but needs to press on. He noted a few challenges, citing energy costs. The state government, he added, was pushing hard to get that fixed with market rules adapting to the global shift towards renewable energy.

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