A new index has revealed Australia is falling behind developing nations on returns to its economy and performance of built assets.
The Arcadis “2016 Global Built Asset Performance Index”, developed in conjunction with the Centre for Economics and Business Research, examined the income generated by buildings and infrastructure – homes, schools, roads, airports, power plants, malls, railways, ports and all other fixed assets – in 36 countries that collectively represent 78 per cent of global gross domestic product (GDP).
The index ranked Australia 21st on total returns from built assets, which was below the global average and behind emerging nations such as the Philippines and Thailand.
According to the index, Australia will fall to 23rd by 2026 on total returns.
In per capita terms, Australia was ranked sixth overall.
“In resource- and manufacturing-focused areas of Australia, the emphasis will be on driving operational efficiency from existing assets, and effectively dealing with the legacy environmental issues created by those industries,” Arcadis Australia Pacific built asset consultancy director Gareth Robbins said.
“Meanwhile, in the cities the focus will be on creating sustainable and liveable urban centres through the provision of high quality transportation and housing assets in order to create environments that can attract the jobs and people required to support economic growth.”
He said New South Wales and Victoria had a very strong pipeline of infrastructure projects planned for the next decade to address rapidly growing cities.
“However, more will need to be done to unlock the value and potential of built assets left over from the slowdown in mining, and replace the decline in manufacturing,” he said.
The index also revealed China’s economic growth was highly powered from its built assets, accounting for 52.9 per cent of GDP returns this year, but this is expected to peak as its economy gradually rebalances towards services and consumption, rather than manufacturing and investment.
By 2026, emerging markets will increase their dominance for high performing and sustainable built assets.