Brett Kapernick DEP Chief Executive

Economic Futures ForumA masterplan for growth

Central Highlands Development Corporation

Monday 19 March 2018

Queensland Tourism Industry Council (QTIC)

State of Industry and future

Challenges and Opportunities

Photographer Greg SullivanCourtesy of TEQ image gallery

WHO IS QTIC?

QTIC is owned and governed by our members and is overseen by a Board of Directors.

We work in partnership with government agencies and industry bodies at a local, state and national level, to strengthen the voice of tourism in all relevant policy forums

STATE OF INDUSTRY

$25 billion contribution to the Queensland economy (7.9% of Queensland’s Gross State Product(GSP).

Generates $6.6 billion annually as an export earner.

Second largest export earner for Queensland, behind coal.

$25bn

$6bn

2nd

Source: Tourism Research Australia, State Tourism Satellite Accounts

STATE OF INDUSTRY

,

Source: Tourism Research Australia, State Tourism Satellite Accounts

• Strong, sustained growth across markets• UNWTO expects Australia’s tourism growth at

4+% annually over the next 15 years.

• Up to 23,000 new tourism jobs in Queensland by 2020.

STATE OF INDUSTRY

On an average day in Queensland:• 140,000 international visitors

– Spending $15 million

• 220,000 domestic visitors

– Spending $40 million

STATE OF INDUSTRY

This number is expected to grow by 43 million a year on average

Challenges & Opportunities• Migration• Workforce• Over Tourism• Government Commitments• Innovation• Climate Change• Collaboration/inclusive growth

Brett StratfordDirector, Tourism Industry Engagement and Innovation

Department of Innovation, Tourism Industry Development and the Commonwealth Games

Queensland Tourism

23.8m 4.6%

TOTAL OVERNIGHT VISITORS

$56m p/day 4.98%

OVERNIGHT VISITOR EXPENDITURE

Opportunities and challenges

• Capitalise on our unique advantages

• Expand Queensland’s market share

• Strengthen industry’s long-term sustainability

• Deliver greater investment in new tourism experiences, products and infrastructure

• Deliver jobs and skills now and the future

• Increase regional dispersal

Opportunities and challenges• The number of international visitors is growing

• The share of expenditure from international visitors is set to significantly increase

• Travellers are seeking unforgettable local experiences

• Regions can leverage local strengths to deliver unique experiences

• Events hold a huge growth potential for Queensland tourism

• New technology, experiences and decision-making

Growing the industry

• Advancing Tourism 2016-20

• $33.5 million Advance Queensland: Connecting with Asia Strategy

• $10 million Attracting Aviation Investment Fund (AAIF)

• Tourism Demand Driver Infrastructure Program

• DestinationQ partnership and events: brings together government and industry to grow Queensland jobs

Growing the industry - actions

• Grow and develop regional events

• Deliver Young Tourism Leaders program

• Attract new direct flights to Queensland and regions

• Encourage ecotourism development and indigenous tourism opportunities

• Attract tourism investment and infrastructure

• TEQ’s world first ‘Best of Queensland’ experiences program

New Investments and Opportunities

• Event Funding

• National Parks

• Wide range of business support programs

In closing

• It’s a great time to be in tourism

• Passion and purpose

• Innovation mindset

• Collaboration needed to build mass and traction

Connect with us

www.facebook.com/DestinationQld

twitter.com/DestinationQld

www.linkedin.com/company/destinationq

www.instagram.com/destinationqld/

www.destinationq.qld.gov.au

www.business.qld.gov.au

Engineering & ManufacturingCHDC Economic Futures Forum

Building Business Readiness

Continuous ImprovementStake Holders

Customers

Suppliers

Community

H.E.M.E.

CustomersStaffClients

Keep in touch - reviews, toolbox meetings (they bring a different perspective)Multiskilling/Upskill –utelise technology

StaffVisit clients siteIncrease serviceOffer solutionsOne Stop Shop

Clients

Suppliers

SET PRICING PAY ON TIME CREATE RELATIONSHIP

KEEP INFORMED OF YOUR

DOCUMENTATION NEEDS

DFOT

Community

SPONSORSHIP DONATIONS AND TIME

HIGH SCHOOL RELATIONSHIPS

APPRENTICES AND SCHOOL

BASED TRAINEES

Continued Success

H.EM.E. Pty Ltd

Staff

Clients

Suppliers

Community

Kym HellmuthCompany Manager

One stop shop for engineering solutions since 1997

CHDC ECONOMIC FUTURES FORUM

Michael AnthoniszDirector, Economic and Market Research, QTC19 MARCH 2018

2

Economic update (Global, Australia, Queensland)

Regional industry opportunities

- Coal

- Renewables

- Agriculture

- Emerging technologies

- Future of work

Overview

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Global economy - as good as it gets?

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Global economy - as good as it gets?

Forecasts revised up! Where to from here?

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Australia – Activity strong, prices weak

Source: Thomson Reuters Datastream, QTC

QTC PCA based indicators (Australia II)All axes represent 1st principal component's number of standard deviations away from average levcels

Spare Capacity Labour Market

Wages Inflation04 06 08 10 12 14 16 18

-2

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304 06 08 10 12 14 16 18

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04 06 08 10 12 14 16 18-2.0

-1.5

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0.0

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04 06 08 10 12 14 16 18-2

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Australia – Conditions good + getting better, rate sensitive sectors soft but improving , investment firm but levelling out

Source: Thomson Reuters Datastream, QTC

QTC PCA based indicators (Australia I)All axes represent 1st principal component's number of standard deviations away from average levcels

Current activity Future activity

Interest Rate Sensitive Sectors Investment00 02 04 06 08 10 12 14 16 18

-3

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00 02 04 06 08 10 12 14 16 18-5

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00 02 04 06 08 10 12 14 16 18-3

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00 02 04 06 08 10 12 14 16 18-4

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Queensland - business and consumers

Business and consumers in QLD feeling good about things!

Queensland - Labour market

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Jobs growth the fastest this decade

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Regional industry opportunities - Coal

Move to cleaner energy will reduce coal’s share of the pie

BUT the pie is growing

AND technology could partially mitigate

Number of advanced technology coal fired power plants planned or under construction

Source: Resources and Energy Quarterly September Quarter 2017 (Department of Industry , Innovation and Science) and BP 2017 Energy Outlook

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50% RET by 2030

One million rooftops (or 3,000 megawatts) of solar photovoltaics in Queensland by 2020

Solar programs for public housing and schools

The first large-scale solar projects in Queensland have now come on-line and there are another 20 projects either commencing construction or finalising commercial arrangements

These projects will have installed capacity of almost 1800MW + create around 2800 construction jobs in regional QLD

Providing long-term revenue contracts to successful Queensland bidders for ARENA funding to develop solar energy capacity

Regional industry opportunities - Renewables

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Regional industry opportunities - Agriculture

Source: http://www.agriculture.gov.au/abares/research-topics/productivity/data, South America: an emerging competitor for Australia's beef industry, ABARES Research Report 16.14, December 2016

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Regional industry opportunities - Agriculture

Source: South America: an emerging competitor for Australia's beef industry, ABARES Research Report 16.14, December 2016

Beef industry in South America undergone sig. change over past 15 years- Invested to improve production efficiency, disease management and supply chains

This + better market access have seen South America beef exports grow rapidly

South American beef exports have typically not gone to markets where Australia’s have

BUT South American beef has increasingly been gaining access to new markets (eg, China)

Australian beef now competing in some major markets against lower cost Brazilian beef

How we position ourselves?- Proximity to Asia an advantage given strengthening demand for protein- Capitalise on reputation as a high-quality and environmentally sustainable beef producer- Higher-cost supplier so focus on premium markets

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Regional industry opportunities - Agriculture

Source: South America: an emerging competitor for Australia's beef industry, ABARES Research Report 16.14, December 2016

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Regional industry opportunities - Emerging Technologies

Questions

- Can we get the regulatory frameworks right?

- Who bears the cost to society?

- Singularity…

Source: Google Images

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Regional industry opportunities - Emerging Technologies (productivity to pick up)

Source: Artificial Intelligence and the Modern Productivity Paradox: A Clash of Expectations and StatisticsErik Brynjolfsson, Daniel Rock, Chad SyversonNBER Working Paper 24001

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Regional industry opportunities - Future of work

Study % ofworkforce

% of occupations

Time period

Australia’s Future Workforce, CEDA, June 2015 40 - 10 to 15 years

Mechanical boon: will automation advance Australia?, Department of Industry, October 2015

- 44 As of 2014

Source: CEDA, 2015

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Summary Economic momentum improving at global, national and state levels

Regional industry opportunities

- Coal: Thermal coal share of pie shrinking but pie still growing

- Renewables: Plenty of opportunities in the Sunshine State

- Agriculture: Issues to address include slowing productivity + competition from South America

- Emerging technologies: Brings tremendous challenge and opportunity

- Future of work: People’s lives will be affected in some way

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In conjunction with UQ Business School Executive Education, the QTC Education Program:

offers education courses to the public sector upskills and empowers leaders and financial

managers with specialist financial knowledge and capabilities has the financial expertise, but is also part of the

Queensland Government family, and can be delivered anywhere in Queensland,

offering a tailored education solution.

QTC Education Program

Some of the workshops include: Business Cases in Practice Understanding Financial Statements Asset Management Project Management

Visit clients.qtc.com.au/education for more information or contact your QTC representative.

19

QTC has prepared this presentation for use solely at the CHDC Economic Futures Forum.

The recipient shall not use the presentation for any purpose other than the purpose for which the presentation was expressly provided. The presentation contains confidential information. None of its contents may be provided or disclosed to any other party without QTC’s express written consent.

The information in this presentation is provided by QTC in good faith in relation to the information available at the time ofits preparation and on the basis of information supplied to QTC by third parties. QTC has not independently verified the information supplied to it and accordingly does not represent that the information provided to QTC is accurate or complete and it should not be relied upon as such. QTC is under no obligation or duty to notify anyone if there is any change in any information or any new information or if it forms a different opinion at any time after the date of this presentation.

Neither QTC nor any of its employees or agents accepts any liability for any loss or damage suffered by any person as a result of that person or any other person placing any reliance on, or acting on the basis of, the contents of this presentation.To the extent permitted by law, QTC expressly excludes any representation or warranty in relation to the accuracy, currency and completeness of the presentation. To the extent permitted by law, QTC limits its liability to the amount of any fees paidto QTC for this presentation.

The recipient acknowledges that QTC is not a legal, tax or accounting advisor and that independent expert advice from practitioners in the relevant disciplines should be obtained on those matters before acting upon the information contained in this presentation.

© Queensland Treasury Corporation 2018

Disclaimer

Economic Futures ForumTanya Jackson RES

March 2018

Emerald Solar Farm

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• Approximately 250,000 Solar Panels• 72 MW of renewable energy• Sufficient to supply electricity to approximately 35,000 Queensland

homes annually. • This abates nearly 200,000 tonnes of CO2 emissions annually.• 150 jobs during construction• First electricity in October 2018

Emerald Solar Farm

3

Emerald Energy Project Co Pty Ltd

Project Developers & Construction & Asset Managers• Family Owned• 35 years experience• Operating in 11 countries• 2000 employees

Construction Contractors

Project OwnersInvestment firm and fund manager focused on sustainable infrastructure investment.

Economic Benefits

4

• $150 million investment during the construction phase• 6 locals employed to date • ~$20,000/week in wages over the course of construction• Local Quarries – Quarries of QLD, Emerald Quarries Approx. $800,000.00

duration of the project• Local drivers, civil operators and hire companies all engaged • Local Trucking/courier companies, tilt trays and craneage• Currently $10,000 per week spend with local hire companies• $50,000 donated to the Western Kangoulo scholarship programme which assists

impoverished individuals to access to employment business, education, sporting and other activities.

• Local accommodation at Sullivan’s ~$40,000 pm• Local accommodation at Discovery park ~ $70,000 pm at present and rising• Local Suppliers –$30,000 in the last 10 days with local suppliers• Local entertainment – Crews from outside spending locally supporting local

hotels, cafes, supermarkets and attending events.

Doin’ it for Dolly Charity Rodeo – Springsure

Construction Site Lay Down Area

Emerald Project Progress:EPC Building & Civil Engineering Works• Mobile Offices now on site• Civil work for site office compound area

completed • Perimeter Fencing commenced• Site laydown area completed• Main Site offices installed• RCR ready to undertake the earthworks for

the Ergon substation pad

EPC PV Panels and Equipment• Invertors, panels, posts, transformer and

cables all purchased• Transformer due late April • Posts and tracker systems delivery – mid –

late April• Modules arriving from late April• The first lot of Torque tubes have arrived

in Brisbane port and currently are being de stuffed in Port.

• Piling and trenching teams are on track to mobilise to site for mid to late March.

Perimeter Fence Posts at South West Corner

Clearing Vegetation from Northern Boundary Irrigation Chanel

Emerald Energy Project Pty Ltd

Any questions?

@RES_Americas | @RESenFrance | @RESGroup