The Non-Mining Economic Recovery Dr David Gruen Australian Treasury ABE Annual Conference 21 November 2013

Real GDP growth Comparison of forecasts Source: Consensus Economics and Treasury.

Real Exchange Rate and Terms of Trade Source: ABS Cat. No , RBA and Treasury.

Business lending rates Source: RBA.

Capital expenditure Mining Note: Estimates of CAPEX are adjusted using realisation ratios. The chosen realisation ratios minimise the forecasting error. The upper and lower error bounds are based on the historic forecasting errors for the selected realisation ratios. Source: ABS Catalogue Number and Treasury. Non-mining

Resource investment – major projects Source: Treasury.

Resource exports Average annual percentage contribution to real GDP growth Source: Treasury.

Contributions to real GDP growth Note: Assumes that mining investment has an import share of 50 per cent. Forecasts and projections are from PEFO. Source: ABS cat. no and , BREE and Treasury Percentage points Net resources investment Forecasts GDP growth Non-resources sectors Projections Resources exports Resources sector

Labour market Source: ABS Cat. No

Capacity utilisation by sector SOURCE: NAB, Quarterly business survey, September quarter 2013.

Dwelling investment response to easing cycles Source: ABS cat. no , RBA and Treasury.

House price to income ratio Note: Ratio of median house prices to average household gross disposable income; income is before the deduction of dwelling interest payments; excludes income of unincorporated enterprises. Source: ABS, HIA, RP Data - Rismark and Treasury.

Note: Total consumption includes both general government and household final consumption expenditure Total investment includes total private investment (including ownership of dwellings) and total public investment Source: ABS Catalogue Number Consumption Jun-83Jun-89Jun-95Jun-01Jun-07Jun-13 Per cent of GDP and investment TotalInvestment (RHS) TotalConsumption (LHS)

Short-term visitor arrivals: source countries (rolling annual sum) Source: ABS Catalogue Number

Contributions to annual income growth Source: ABS Cat. No , and Treasury calculations s1970s1980s1990s2000s to 2013 Net foreign incomeLabour productivityLabour utilisationTerms of tradeGNI per person Percentage points contribution, annual average Decade to 2023 Note: Long-run average annual labour productivity growth and a zero contribution from changes in net foreign income are assumed over the decade to 2023.