victoria's economic development: a state of cities

Victoria’s Economic Development| 13 October 2014

Victoria’s Economic Development

Presented by Brian HaratsisMonday 13 October 2014

A State of Cities


Strategic Direction

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Infrastructure

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Economic Restructuring

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Governance


Melbourne is the key economic engine for Victoria

The key priority is to generate internationally competitive service sector


Eastern Seaboard Megalopolis

Sydney

Pop 2014: 4,823,700

Pop 2061: 8,493,700Melbourne

Pop 2014: 4,422,700

Pop 2061: 8,580,600

Canberra

Pop 2014: 390,080

Pop 2061: 740,900

Brisbane

Pop 2014: 2,293,400

Pop 2061: 4,788,000

Eastern Seaboard Major Cities Total

Pop 2014: 11,929,900

Pop 2061: 22,603,200


A State of Cities


Victoria V Singapore 1:1 Size Comparison

Singapore has the population of Victoria (5.4 Million), but would fit more than five times into Melbourne’s UGB


Relative density

In fact, Singapore fits twice into Mornington Peninsula (S)


Melbourne’s Future in a State of Cities

Becoming a ‘Global City’

Restructuring from ‘Australian’ settlement pattern to ‘Global’ settlement model.

Recognises:

Asia

Global Services Sector

Cities for Service Sector Exports Only

Export ‘Heavy Lifting’ Done by Resources and Energy


A Forecast of 10 million Victorians

The target of 7.7 million residents of Melbourne by 2051 is explicit in PLAN Melbourne

It is based on data from Victoria in Future’s 2012 release; In its the most recent release, VIF revised this figure up to 7.8 million people, a figure in accord with ABS B series forecasts.

Reaching a target of 7.7 million people in Melbourne by 2051 would require a population increase between 86,000-94,000 people per year, or a growth rate of 2.1%, declining to 1.1% by 2051.

VIF’s 2014 report forecasts consistent growth in Victoria’s regions to 2051, when they will have a population of 2.2 million


Plan Melbourne… A State of CitiesKey facts and figures

Melbourne’s population is expected to be between 7.6 and 8.5 million people by 2050. At this point it will be more populous than Sydney.

Recent bureau figures imply that Melbourne today is home to 4.35 million people, and 27% bigger than the city it was at the start of 2000.

Melbourne is forecast to grow by 90,000 persons and 27,800 dwellings per annum to 2030.

The proportion of people aged 65+ is expected to increase from 14% to 22% by 2050.


PLAN Melbourne | Initiatives


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PLAN Melbourne | Metropolitan Melbourne Structure Plan


PLAN Melbourne | Metropolitan Melbourne Structure Plan (continued)


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Melbourne Rail Link


Housing Demand

A recent forecast by Macroplan Dimasi shows an increase in expected dwelling growth from 30,000 to 40,000 dwellings per annum, this is to be caused by the appearance of a new urban renewal market

High and medium density dwellings are expected to make up about 60% of future dwelling demand to 2031 (approx. 24,000 dwellings p.a.)

At 40,000 dwellings per annum, Melbourne will be producing the same number of dwellings annually as New York and London


Economics – House Price Arbitrage

Mel ~$100,000 less


Economics – Job Growth Top 15 Employment Growth Regions, 2013-2018

15.4

16.1

16.2

16.5

18.1

18.6

18.9

18.9

29.4

31.4

32.9

32.9

34.1

34.8

42.5

0.00 10.00 20.00 30.00 40.00 50.00

Sydney - Eastern…

Sydney - Baulkham…

Fitzroy

Ipswich

Brisbane - South

Brisbane Inner City

Sydney - Inner South…

Sunshine Coast

Sydney - City and…

Perth - South East

Melbourne - Inner

Gold Coast

Perth - North West

Melbourne - South East

Melbourne - West

Employed Persons ('000)

351.1

309.6

281.7

253.2

247.1

229.0

183.0

142.1

141.0

118.6

117.4

110.1

98.8

80.7

58.7

58.0

43.2

37.1

13.5

0.0 100.0 200.0 300.0 400.0

Health Care and Social Assistance

Retail Trade

Manufacturing

Professional, Scientific and…

Construction

Education and Training

Accommodation and Food Services

Public Administration and Safety

Transport, Postal and Warehousing

Wholesale Trade

Financial and Insurance Services

Other Services

Administrative and Support Services

Agriculture, Forestry and Fishing

Arts and Recreation Services

Information Media and…

Rental, Hiring and Real Estate…

Electricity, Gas, Water and Waste…

Mining

Employed Persons ('000s)

Victoria, Projected employment growth ('000) - five years to November 2018


Economics


Demographics | population growth

Source: ABS Cat 3101


Interstate Migration | Victoria

Source: Australian Bureau of Statistics

-6,000

-4,000

-2,000

0

2,000

4,000

6,000

8,000

10,000

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

0-14 15-24 25-34 35-54 55-64 65+


Overseas Migration | Victoria

Source: Australian Bureau of Statistics

-10,000

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

0-14 15-24 25-34 35-54 55-64 65+


The Future of Chinese Tourism: Australia and Victoria have Capacity and Strategic Issues

Tourism Research Australia forecast in 2011 that the number of outbound Chinese tourists would likely reach 100 million annually by 2020

It is estimated by CLSA (Asia’s leading equity broker and investment group) that this figure was reached in 2013 and that the annual number of outbound Chinese tourists will be closer to 200 million by 2020


Chinese Visitors


The Significance of Chinese Tourism


International Students International Student commencements have returned to pre-GFC/Indian

student crisis levels


Manufacturing

Victoria’s manufacturing sector

295,000 employees (the State’s largest full-time employer)

Over 25,000 manufacturing firms

$110 billion in economic activity per annum

$30.8 billion in gross value add (10.8% of GSP)

$15.3 billion in exports

$1.5 billion spent on research and development


Victorian Capital Expenditure

Restructuring and Efficiency

0

1000

2000

3000

4000

5000

6000

7000

Mining Manufacturing Other (Selected Industries)

$M


Agriculture

Victoria remains one of the Nation’s largest agricultural producers

Source: ABS

Gross Value of Agricultural Commodities Produced 2012/13

Gross Value of Production ($M) Australia

New South

Wales Victoria Queensland

South

Australia

Western

Australia Tasmania

Northern

Territory

Australian

Capital

Territory

Crops 28,048.28 7,591.06 5,620.11 5,583.51 3,719.70 4,871.66 522.44 Not available Not available

Livestock slaughtered and other disposals 13,187.75 3,012.87 3,001.50 4,202.78 1,288.38 1,070.05 266.67 342.17 3.34

Livestock products 6,811.99 1,524.24 3,009.03 513.72 613.42 748.56 401.22 Not available Not available

Agriculture - Total 48,048.02 12,128.17 11,630.64 10,300.01 5,621.50 6,690.26 1,190.34 478.59 8.52


Health and Biomedical Research The Bio21 Cluster

As well as being home to a number of health biotechnology organisations, Victoria’s North biotechnology precinct is the hub of Victoria’s agricultural biotechnology activity. Located approximately 15km north of the Melbourne CBD, Bundoora in the North precinct was recently named as one of Melbourne’s ten 'most liveable suburbs' (Herald Sun newspaper, 2008).

The North precinct is currently undergoing significant expansion with a number of developments in progress. The AU$230 million AgriBio centre is a joint initiative between the Victorian Government, through the Department of Primary Industries, and La Trobe University. It will be a world-class facility for agricultural biosciences research and development.

The North precinct is also home to the Global Headquarters of Siemens VDO.

Monash Biotech Cluster

Located 25 kilometres from Melbourne’s CBD (approximately 25 minutes drive), the South East Biotechnology Precinct is home to Monash University, CSIRO, Southern Health (the largest public healthcare provider in Victoria), the Monash Health Translation Precinct, the Australian Synchrotron and Melbourne’s key pharmaceutical and biotechnology industries, including GlaxoSmithKline, Bristol Myers Squibb, Servierand others.


Victorian Infrastructure PipelineProject Name Stage Value of Project

North Road Level Crossing Removal Committed within Forward Estimates

Burke Road Level Crossing Removal Committed within Forward Estimates

Princes Highway Duplication Project - Winchelsea to Colac Committed within Forward Estimates $250M - $500M

Blackburn Road Level Crossing Removal Committed within Forward Estimates

Main Road Level Crossing Removal Committed within Forward Estimates

Princes Highway East (Traralgon to Sale) Under Construction $100M - $250M

RAAF Base East Sale Redevelopment Approvals $100M - $250M

CGD Municipal Building Project Under Construction $50M - $100M

Springvale Road Grade Separation Project Under Construction $100M - $250M

Mitcham Road and Rooks Road Rail Grade Separation Project Under Construction $100M - $250M

Port of Melbourne Port Capacity Project Tender $1B - $5B

Koo Wee Rup Bypass Under Construction $50M - $100M

Ballarat to Stawell Duplication Committed within Forward Estimates $500M - $1B

Geelong Hospital - Major Upgrade Committed within Forward Estimates $50M - $100M

Geelong Ring Road - Stage 4C, Surf Coast Highway Connection Under Construction $50M - $100M

Construction of Ravenhall Prison and Additional Prison Beds Committed beyond Forward Estimates $500M - $1B

Monash Children's Hospital Committed within Forward Estimates

Royal Victorian Eye and Ear Hospital Committed within Forward Estimates

East West Link - Eastern Section Tender Greater than $5B

Dingley Bypass - Warrigal Road to Westall Road Tender $100M - $250M

Western Highway Duplication - Ballarat to Stawell (Section 2A - Beaufort to Buangor) Tender $100M - $250M

Port Rail Shuttle (Metropolitan Intermodal System) Committed within Forward Estimates $50M - $100M

Waurn Ponds Community Hospital Committed beyond Forward Estimates $50M - $100M

Cranbourne-Pakenham Rail Corridor Project Tender $1B - $5B

Calder Highway Interchange Committed within Forward Estimates $50M - $100M

Melbourne Park redevelopment - Stage 2 Committed within Forward Estimates $250M - $500M

Murray Basin Rail project Committed within Forward Estimates $100M - $250M

Shepparton Law Courts Planning $50M - $100M

East West Link - Western Section Committed within Forward Estimates Greater than $5B

Latrobe Regional Hospital redevelopment - stage 2A Planning $50M - $100M

Melbourne Rail Link (including Airport Rail Link) Committed within Forward Estimates Greater than $5B


Governance

Metropolitan Planning Authority

New planning authority inside the UGB and potentially outside

Unsolicited Bids

Harnessing the private sector


The Wish List…

Cruise Ship Terminal

East West Link

High Speed Airport Rail

Western Intermodal/ Kalkallo/ Inland Rail Link

Inner Melbourne – 1 million population/ 1 million jobs

Fishermans Bend/ Link to Bay/ Active Waterfront


The Wish List… (Cont.)

New Tourism/ Cultural Asset ‘Asian Attraction’

Global Media Hub

Global Headquarters for Food/Fibre

Redirect Population Growth to regional Cities

High Security Buildings/ Hub/ Conferencing

Additional Global University


Thank you.

victoria's economic development: a state of cities

Economy & Finance

plan melbourne infrastructure

residents of melbourne

key economic engine

victorias regions

plan melbourneit

population of victoria

proportion of people

state of citiesbecoming