Western Australia strongest state on economic growth

Australia is having a three-speed economy, with Western Australia leading as the strongest state on economic growth, and New South Wales ranked in the slowest lane, Commonwealth Securities (CommSec) quarterly "State of the States" report said on Monday. CommSec analyzes Australia's states through eight key indicators, economic growth, retail spending, equipment investment, unemployment, construction work done, population growth, housing finance and dwelling commencements. According to report author and Commsec economist Craig Jame, the results highlight the emergence of a multi-speed economy. He said Western Australia is clearly the nation's strongest economy and leading the way on equipment investment and it is also strong in retail spending, population growth and construction. He expects Western Australia to outperform if the Chinese resources boom continues. James said New South Wales, Queensland and Tasmania are part of another grouping which is towards the bottom end of the pack. "I think it is fairly clear that performance can be broken up or divided up into those three different groupings," he said. On New South Wales, CommSec economist Savanth Sebastian said the state is struggling to find an X-factor that will drive growth. "Population growth has been above average and that has supported New South Wales to some extent, but if you look across at other state economists there's the mining boom in Western Australia, Victoria has had healthy dwellings starts, and even Tasmania has low unemployment rates which is driving retail sales activity, and that's much the same for the Northern Territory," Sebastian said. But Sebastian said the New South Wales state government's move to abolish stamp duty should deliver some improvements to the state's housing industry. The report also said new dwelling starts in Queensland were not only 30.5 percent below the decade average, but 17.9 percent down on a year ago. Housing finance in Queensland was down 24.6 percent on the decade average. However, Queensland state Deputy Premier and Treasurer Andrew Fraser said the Commsec October quarter report was at odds with a number of leading economic reports which show Queensland is roaring back in a big way. "If you look at any number of recent leading economic reports - National Australia Bank, Westpac, Deloitte Access Economics and the Commonwealth Bank's Economic Research report - you'll see Queensland is gearing up for nation-leading economic growth," Fraser said in a statement. "Deloitte Access Economics said 'the big rebound in State growth has begun' and the Commonwealth Bank's economics team says 'Queensland is starting to pop'. "NAB reports 'economic growth should outperform the national average this year' and Westpac's studies say 'mining investment has propelled Queensland from laggard to leader'." Fraser said the Commsec report has no credibility, and he was more focused on Australian Bureau of Statistics figures, which paint a brighter future for the state.