Resources sector to feel the ‘pinch’ of recession, MP says
THE resources sector will experience a delayed hit from the COVID-19 crisis as early as next month, Dawson MP George Christensen says.
It comes after Treasurer Josh Frydenberg today said Australia's economy was in a recession, on the back of a 0.3 per cent fall in gross domestic product over the March quarter.
The technical definition of a recession is two consecutive quarters of GDP shrinkage.
Mr Christensen said Mackay would not be immune from the impacts of what he described as a "global recession".
"The big issue for our region is going to be the delayed impact on the mining sector and resources sector," he said.
"I strongly suspect that we are going to feel the pinch in the resources sector in the next quarter - from July through to September."
The Dawson MP warned falling coal prices caused by COVID-19 could force some mining companies to put their operations on hold.
But the pain is expected to be temporary and the resources sector will help in Mackay's recovery from the recession, he said.
"Mackay has been buffered from the crisis so far because we have been reliant on resources and agriculture," Mr Christensen said.
"We could see in the medium to long term a pick up in employment on the back of resources."
Resource Industry Network director Mark Walter said the industry would continue to be a pillar for the economy.
"While we are aware of downward pressure on coal pricing post-COVID, we anticipate our region will perform well during this period," Mr Walter said.
Mackay Region Chamber of Commerce committee member Scott Jamieson said the sooner restrictions were eased, the better off the economy would be.
"We have to balance that with making sure we don't have a second wave of the virus, which could cause a longer and deeper recession," he said.
Greater Whitsunday Alliance chief executive Kylie Porter urged the Mackay community to spend locally and take advantage of government stimulus packages to help the economy recover.
"The reality is, we have a role to play to ensure our economy continues to perform strongly and that is continuing to spend and invest in our region," Ms Porter said.
Mackay MP Julieanne Gilbert said new manufacturing industries would help protect Mackay's future.
"We need to make sure we are looking after our national economy by making sure those jobs and industries are built in our regions," Mrs Gilbert said.