By Mark Stone
The Victorian Government must act now to ensure that the state is prepared for the expected rapid growth in international trade and can capitalise on the opportunities that this presents to Victorian business.
A recent report into the global demand for transport infrastructure over the long term by the Organisation for Economic Co-operation and Development (OECD) highlights the need for governments to prepare for the infrastructure needs of the future.
The report, Strategic Transport Infrastructure Needs to 2030, says that, with world GDP set to double by 2030, this growth will be associated with rapid increase in trade, especially within Asia and between major regions.
Under these growth scenarios, world air passenger traffic could double, air freight could triple, and port handing of maritime containers worldwide could quadruple.
The development of gateway and corridor infrastructure is crucial to ensuring Victoria capitalises on the opportunities this presents, enabling businesses to access these high-growth markets for the export of goods and services. This further underpins economic and employment growth throughout the state.
The report also highlights the importance of good infrastructure planning processes, and the role of private sector investment.
In our pre-Budget submission to the State Government, VECCI highlights recommendations from the Victorian Competition and Efficiency Commission (VCEC) State Reform Agenda which call for a long-term strategic planning framework for Melbourne, saying these recommendations must be addressed in the upcoming Budget and applied not just to Melbourne, but to our regional and rural areas.
In terms of infrastructure, this framework needs to be underpinned by plans covering transport services for individuals and freight, including our future port and air transport requirements. A Major Projects Facilitation Act, modelled on the Major Transport Projects Facilitation Act, would assist in coordinating agencies to achieve timely, logical decisions.
Key projects that need to be accelerated in the short-term to address existing pressure points include an east-west link between the Eastern and Tullamarine Freeways, the extension of the Melbourne Exhibition Centre, the Avalon Airport rail link, enhanced container capacity at Webb Dock and the Melbourne Metro rail project.
Improved regional links to assist regions absorb population growth are also important, as are smaller regional roads in areas of economic importance, particularly those associated with our competitive position in the tourism and food processing sectors.
The momentum of work underway in the Regional Rail Link needs to be maintained. Most parts of this project will operate under the enhanced Implementation Guidelines to the Victorian Code of Practice for the Building and Construction Industry from July 1, a move that will also help to ensure timelines for the project are not derailed.
Victoria’s future economic welfare and liveability depends on quality hard and soft infrastructure that keeps pace with population growth, changing industry structures, new technologies and emerging global trade and investment opportunities.
While the role of government in meeting our infrastructure task should not be underestimated, the private sector must be encouraged to play an even bigger part in infrastructure provision. The superannuation system has created a large pool of capital and we need to maximise the opportunities to leverage this investment in the state’s – and nation’s – infrastructure needs.
The challenge ahead is for governments at all levels to bring more investment opportunities to the market given the capital available, the investor interest and the imperative to enhance our infrastructure.
Click here to read VECCI’s 2012-13 pre-Budget submission summary.