The state government of Queensland might have missed an opportunity to attract more investors and boost economic activity with its latest plans to achieve recovery post-COVID-19, according to the Property Council of Australia.
In its latest announcement, the state government pledged $1bn direct investment in commercial business and projects.
"With interest rates at record lows, the Queensland Government will borrow to invest in Queensland business and industry to create more jobs. Importantly, as these funds are commercial investments, Queensland taxpayers will not be responsible for servicing those borrowings," said State Treasurer Cameron Dick.
However, Queensland needs to be able to look at the current market in a new perspective and consider other ways to create jobs and provide economic stimulus, said Chris Mountford, executive director for Queensland at the Property Council.
The state government, Mountford believes, should consider a revision of taxation and regulatory settings, particularly those that are discouraging potential investors.
"Whether it be removal of the foreign investor surcharges, reduction of land tax for build-to-rent, removal of stamp duty for off-the-plan dwellings, or simple acts like changing the strata title termination thresholds, there are many ways the government could stimulate private sector activity rather than seeking to compete with it," he said.
Mountford said the COVID-induced recession needs a different approach as to what was taken during the Global Financial Crisis (GFC).
"Post-GFC there was a greater reliance on government expenditure as there was a shortage of private capital in the market," he said.
Mountford said the $1bn investment to private businesses appear to be "misplaced" as it results in the state government competing with private capital instead of encouraging more private investment.
"Now, however, the globe is awash with capital seeking a safe, secure return. Queensland is well placed to capitalise on this appetite for investment. However, the settings must be right to make the state an attractive place for investment," he said.
