Adept Economics economist Gene Tunny said Central Queensland’s economy was relatively better off during COVID-19.
Adept Economics economist Gene Tunny said Central Queensland’s economy was relatively better off during COVID-19.

How CQ coped better with COVID than rest of country

CENTRAL Queensland coped better economically with COVID-19 than other regions in Australia and is well positioned for the future, Adept Economics economist Gene Tunny said at a Rockhampton business conference.

At the Capricorn Enterprise Major Projects Forum last Thursday, Mr Tunny said the relative success was due to the importance of primary industries - mining and agriculture - which constitute about 14 per cent of the region's economy compared with 5 per cent statewide.

"The outlook for ag is very good," Mr Tunny said, "because that's tied to cattle and beef, and that's tied to the growing global middle class.

"China's having a V-shaped recovery - the outlook of China is for continued growth over the next few decades, and that will drive growing demand for those products."

The Emerald saleyards.
The Emerald saleyards.

Despite there being "much debate" about the longevity of thermal coal - perhaps 15 to 20 years - Mr Tunny said metallurgical coal would stay strong and be "good for the region".

Because of a push towards renewables, "there are big concerns about how long we can keep burning thermal coal," he said.

"China is trying to improve its self-sufficiency: they'll want more coal this year from domestic sources.

"Because coal prices are relatively low, that's affecting the viability of a lot of coal mines out there."

At the forum, QRC chief executive Ian Macfarlane spoke about the need to secure stable royalty rates for mines.

Mr Tunny echoed the sentiment, saying high royalties were "not a good way to raise revenue".

"Royalties are not a very good way to tax the resources sector to begin with," he said.

"There can be a problem with royalty schemes in that they can discourage production … it can eat into your profit margins.

"You need some compensation to the people for the use of the resources, because they're owned by the community, by the state of Queensland, but at the same time you don't want to set the rate so high that you discourage production or future investment, because it's not economic."

Coal mining vehicles.
Coal mining vehicles.

Mentioning regulatory roadblocks for Great Keppel Island, Adani's mines, industrial relations legislation, he said the government should cut red tape affecting businesses so that job-creation could lay a strong foundation for the future of Central Queensland's economy.

"We need a government that is more focused on allowing development to occur, so by having the regulations that are necessary to ensure the environment's protected … but we should recognise that it's important to get those projects up and running as soon as possible to create those jobs that we need."


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