16 February 2015
Our image for this newsletter symbolises the commercial, global value chain and market-led approach of growNORTH based on the working assumption that a crucial underpinning or critical success factor is a solid economic justification or foundation. It better enables the private sector co-investment so critical to achieving our vision and allows potential public and academic investment more clarity and purpose in measurable outputs and ongoing benefit. It is at the core of our vision of having capital flowing more strongly to the North for the benefit of the North and wider Australia.
In this edition we lay out a summary of what we call our economic base case. It is a base case because the continuous learning cycle approach we are taking (and laid out briefly in our previous newsletter) is designed to strengthen our transformative agenda and economic outcomes over time.
Our Economic Base Case
growNORTH is proposed as a $316m, 10-year collaborative research and development venture put together to provide a step change opportunity for communities across Northern Australia. With a proposed 10-year Commonwealth contribution of $75m and a projected $316m investment from industry, partners and researchers, we have estimated a gross benefit of $1.2b to the Australian economy. Accounting for all costs to deliver this dividend the benefit:cost ratio is 2.07.
At this point 19 critical large-scale transformational projects have been costed working directly with industry partners investing over $45m cash for 3 to 10 years with an expectation of matching funding from the government. These projects aim to solve ‘make or break’ issues for northern agricultural businesses. These projects represent the more significant, advanced and early investment discussions between growNORTH and industry. We are confident about securing additional private sector investment once our way forward is clear.
However, growNORTH is not just about large ventures. To ensure all companies, large and small, have access to the growNORTH platform a ‘shop front’ is proposed to link industry and research for tactical research outputs. It is proposed that this aspect of growNORTH will operate in a self-sustaining manner beyond the proposed 10-year funding period to provide an enduring legacy from the initial investment.
This strong business case, together with the ability for enterprises and communities of all sizes to be involved and have access to the work and the sheer size of the market opportunities evident in the North, underpins the growNORTH proposal. In our view the barriers that have prevented growth in the North have not previously been tackled in a co-ordinated and holistic fashion and by doing so, we will enable the sustainable realisation of many of these opportunities.
The business case re-write is almost complete to a first full draft. We look forward to sharing it widely and seeking further input to it shortly. Spending time getting the foundations set right will significantly lift our chances of achieving our goal – that of lowering investment barriers in the North and enabling a significant flow of capital against the market opportunities that are so clear.
Update – the Australian Government’s policy and review processes
We continue to look forward to the release of the Developing Northern Australia White Paper which is the amalgam of the work and input of so many and will guide us as we complete this proposal and more broadly as many people continue to put the foundations in place for the accelerated and sustainable development of the north.
If you haven’t already spoken with us about your business, sector or community interest in collaborating with growNORTH, please contact us:
Michael Guerin Mike.firstname.lastname@example.org +61 437 622 598 Or Margie Atkinson Margie.email@example.com +61 438 387 303
Courtesy of growNORTH
16 February 2015