POLL: Australians want a Special Economic Zone in Australia’s North

Galaxy Poll: 60% of Australians want a Special Economic zone in Australia’s North

A Galaxy poll conducted exclusively for the Institute of Public Affairs (IPA) found that the majority of Australians are in favour of establishing a Special Economic Zone (SEZ) with low taxes to stimulate economic growth in Northern Australia.

Of the 1,063 people surveyed, 60% were in favour of a Special Economic Zone in Northern Australia while only 20% were opposed to the idea.

The percentage of people in favour of a low tax zone was much higher in Queensland (70% of respondents in favour) and in Western Australia (68% of respondents in favour) compared to the rest of the nation.

Of regional Queenslanders and Western Australians, those people most likely to live in North Australia, 73% said they would support the establishment of a SEZ.

Special Economic Zones

Low taxes and other economic freedoms have been proven to increase investment and drive economic growth. Australia needs a policy framework that provides incentives for investment in order to address skills shortages and rectify the lack of infrastructure in the North.

For many years Australia has enjoyed an advantage in Asia’s resource market, however, that geographic advantage is no longer assured. The development of Very Large Ore Carriers (VLOCs) has enabled high grade iron ore from Africa and South America to be shipped to Asia at much lower prices than was previously possible. Until now, Australia has been a substantially cheaper source of commodities because of our geographical proximity to Asia.

As a result of the reduction in freight costs, Africa and South America are becoming attractive investment destinations for multinational mining companies. This is of particular relevance to Australia’s continued economic growth, as China is looking to these high grade ore regions to bolster its supply.

A Special Economic Zone for Northern Australia

Northern Australia is currently a key driver for Australia’s economy. Yet government regulation and a lack of vision constrains the North from further economic growth.

The North is currently underpopulated and under-developed yet contains a wealth of natural resources. Australian policy makers should be taking advantage of this huge potential by implementing policies that encourage investment, increase infrastructure and create opportunities to deal with the skills shortage crisis.

SEZs have been used around the world to stimulate development and economic activity in underdeveloped areas. Today there are approximately 3,000 SEZs operating around the world. Recently, British Prime Minister David Cameron announced plans to establish 21 new economic zones across the United Kingdom.

SEZs are designated areas where tax and regulation are significantly relaxed or reduced. The focus of such a zone in Northern Australia would be to promote investment, create jobs, encourage skilled migration and transform depressed and under-developed regions into areas of considerable economic activity.

A zone that covers North Queensland, North Western Australia and the Northern Territory would invigorate these underpopulated, under-developed, but resource rich regions.

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