GOVERNMENTS should seize opportunities that deliver long-term economic and social benefits to secure Australia’s recovery from the COVID-19 pandemic, according to CEDA’s 2021 Economic and Political Outlook (EPO) report.
CEDA chief executive Melinda Cilento said COVID-19 "has taught us we do better when we are bold" . Investments in social infrastructure such as childcare, aged care and housing should be high on the list, she said.
Australia should also build on the momentum of 2020 in the digital and data space by improving data sharing and linkage, to underpin evidence-based policymaking, Ms Cilento said.
“A key message from the economic contributors to this report is that despite periodic outbreaks of the virus, confidence and economic activity has been incredibly resilient,” Ms Cilento said.
“Australia remained resilient by taking bold steps on health and the economy – 2021 will be no different.
“A rapid and widespread vaccine rollout will be crucial to maintaining recent momentum. In 2021, everything will flow from this, especially as governments wind back income support such as JobSeeker and JobKeeper that kept much of the economy afloat last year.
“The government should not be afraid to provide continuing support to the hardest-hit industries and individuals to support jobs and incomes, ensuring that the recovery is not derailed.”
Australia’s openness to the world has come under increasing pressure and will be an important watchpoint as COVID-19 recedes.
“We must ensure our migration program emerges stronger, to support the recovery,” Ms Cilento said.
Some key policy debates are already re-emerging, although growth and jobs will dominate this year.
“Climate change should be front of mind, given its business, economic and social significance, as well as the global policy shifts driven by the new Biden Administration in the United States,” Ms Cilento said.
“The Federal Government is moving towards committing Australia to net-zero emissions by 2050.
“Embracing that goal as soon as possible, and outlining more ambitious policies to get Australia there, would build confidence among business and the broader community.”
Another theme is the need to address inequality, which ANZ chief economist Richard Yetsenga said had been rising across many parts of the globe. Lower-paid roles are bearing the brunt of job losses in many nations, and the inequality implications of this will be one of COVID-19’s more important legacies.
“To address inequality in Australia, a permanent increase to the rate of JobSeeker is long overdue,” Ms Cilento said.
“It will do much to support the recovery, and as Reserve Bank of Australia Governor Phillip Lowe has said, it is a fairness issue.”
There are clearly many question marks hanging over this year. CEDA’s Economic and Political Outlook (EPO) 2021 provides valuable analysis to help policy makers and business respond to these issues.
This analysis will be complemented by a keynote speech by Australia's Ambassador to the US, the Arthur Sinodinos, who will share his insights into the US-Australia relationship, at the launch of the report.
The 2021 EPO will be launched at a two-day digital forum today from 11am to 12.30pm and tomorrow, February 17, from 11am to 1pm (AEDT).
The economists and journalists who have contributed to this report are:
- Political outlook: Phillip Coorey, Political Editor, Australian Financial Review
- Domestic economic outlook: Alan Oster, Group Chief Economist, NAB
- Policy outlook: Cassandra Winzar, Senior Economist, CEDA
- International economic outlook: Richard Yetsenga, Chief Economist and Head of Research, ANZ Banking Group
In addition to the authors, speakers include Australia's Ambassador to the United States, Arthur Sinodinos, in conversation with ABC Insiders host David Speers; Griffith Asia Institute director, Prof. Caitlin Byrne; ANU Australian Centre on China in the World director, Prof. Jane Golley; ABC RN Breakfast presenter, Fran Kelly; and Asialink Business chief executive Mukund Narayanamurti.
Download the report here.