Victorian election 2014: Economic clouds loom with the economy growing by 1.7 per cent in the past financial year

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The Age: Victorian election 2014: Economic clouds loom with the economy growing by 1.7 per cent in the past financial year. November 21, 2014. Josh Gordon, State Political Editor

The state economy grew by 1.7 per cent in the past financial year, half the annual average for the past decade.

But Treasurer Michael O’Brien has dismissed the result, pointing out that it followed relatively solid growth of 2.1 per cent in 2012-13.

“Over the last two years Victoria’s economy has grown by 3.8 per cent, compared with an expected 3.6 per cent,” Mr O’Brien said. “This demonstrates that Victoria is on the right track under the economic management of the Napthine government.”

The Bureau of Statistics figures confirm that the state economy has been expanding, although at only a moderate pace, with the outlook clouded by the looming closure of automotive manufacturing and general uncertainty linked to the unwinding of the mining boom.

Victoria is the only state where growth per person is going backwards. During the year, gross state product per capita fell 0.2 per cent, as population growth exceeded growth in the size of the economy.

The figures come just eight days out from the November 29 state election. Economic management has been a key part of the Coalition’s re-election pitch, although the attack has been blunted by the patchy economic outlook and rising unemployment.

Victoria performed more weakly than NSW, which expanded by 2.1 per cent, Queensland, which grew by 2.3 per cent, and Western Australia, which expanded by 5.5 per cent. Of the states, only South Australia and Tasmania were weaker, growing by 1.3 per cent and 1.2 per cent respectively.

Mr O’Brien said business investment had grown by 10 per cent in 2013-14, compared to a 5 per cent fall across Australia.

“The Napthine government’s economic policies are working,” he said. “We have policies to encourage private sector investment here in Victoria.”

“Victoria is driving the country’s construction sector, with major projects including East West Link soon to come on line, creating jobs and boosting the economy.”

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