The agribusiness, food and beverage sector is a sensitive one. As you can see from the graph below, the sector’s contribution to Australia’s GDP over the last decade hasn’t exactly been smooth. The dollar value of the sector is sensitive to local climactic events such as drought, flood and fire but, generally speaking the value is going up. However, as a proportion of GDP the sector has been losing ground as Australia increasingly becomes a knowledge economy.
Will this change with a refocus on sovereign capability?
We think so. The sector received some positive assistance in the 2020 Federal Budget. The $1.3b modern manufacturing initiative where food and beverage has been singled out as a key sector is a positive step. The $14b commitment in new and accelerated infrastructure spending on roads and highways to improve the efficiency in transporting product across the country will have a positive impact in the sector. Disappointingly the review and veto function available to Foreign Investor Review Board (FIRB) on all overseas investments, which could stifle overseas investment, still remains.
From our perspective, there is literally an amazing opportunity on our doorstep. If nothing else, COVID has provided the impetus for reform and an opportunity to do things differently. The agricultural, food and beverage sector, with the right policy framework, can help Australia to grow out of the recession.
In our report we cover:
- Quality over quantity
- Technology and agriculture do in fact go hand in hand
- Is diversification of risk the key to agricultural growth?
- Access to labour and global exports continue to hamper efforts
- So where to from here?
Looking back to look forward
We were initially writing the ‘Federal Budget: A 10 year retrospective’ report before COVID-19 as an advocacy piece for more industry investment and support. Of course, the way the year started is not the way the year is ending. Many sectors that had been left to their own devices are now key for our recovery. Sovereign capability. Jobs. Digital economy. Modern manufacturing. Renewable future. Deregulation. Innovation. These are the terms we will use as we settle into COVID-normal.
Our report looks retrospectively at 13 different industries, the investment made into them by Government and their contribution to GDP. This is then overlaid with the opportunity we see for industry in this new normal based on recent Government announcements.