Australia Rebooted

Reboot Australia: resetting Australia’s economy after COVID-19

COVID-19 has had a significant impact on businesses both globally and here in Australia in just a few short weeks. The International Monetary Fund (IMF) has warned Australia could be one of the worst-hit economies in the Asian region, with the Australian economy forecast to shrink 6.7% this year. The pace of change triggered by COVID-19 is unprecedented. Some changes are undoubtedly temporary, but there exist nine forces of change that will shape Australia over the coming years.

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By doing nothing COVID-19 will cost Australia over $400 billion dollars in national income

The future of Australia’s economy depends on how governments, business, communities and individuals respond. PwC Australia has modelled two scenarios: Fortress Australia and Enterprise Australia. These scenarios show the different directions Australia’s economic and business recovery could take after COVID-19.

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Scenarios for Australia's reboot

Fortress Australia

‘Fortress’ Australia, is a response to the concern that, as a nation, we lack self-sufficiency. It is characterised by nation-first decisions and higher levels of government intervention in industry. Fortress Australia sees a balanced budget de-prioritised for the sake of increased expenditure as governments build on fiscal precedence set during the crisis. 

 

Enterprise Australia

‘Enterprise’ Australia sees smarter regulation and digitisation enable private industry to grow Australia out of the crisis. Merger and acquisition activity and private investment in technology rise as industry doubles down on globalisation in search of productivity gains - in part facilitated by an open doors immigration policy. Fiscal stimulus is unwound and government targets a balanced budget.

Australia will pay a significant cost if it doesn’t go for growth

Decision-makers across Australia’s economy face difficult trade-offs impacting economic growth, productivity, living standards, government intervention, risk appetite, digital investment, security, nationalism, international trade and more. The Fortress Australia and Enterprise Australia modelled by PwC show what outcomes for national income, industry, household consumption and employment outcomes could look like.

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Let’s Reboot Australia

PwC’s results help decision-makers across government and industry understand the key trade-offs between policy decisions and growth outcomes, and their ramifications for businesses, communities and individuals in a post-COVID-19 economy.

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This report is not related to the Australian Manufacturing Workers Union (AMWU) pre-COVID-19 report of March 2019 titled 'Australia Rebooted' and PwC is not affiliated with the AMWU.

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Contact us

Tom Bowden

COVID-19 Market Response Leader, PwC Australia

Tel: +61 2 6271 3229

Jeremy Thorpe

Chief Economist & Partner, PwC Australia

Tel: +61 (2) 8266 4611

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