Australia's healthy provincial economies could especially benefit from the buoyant export picture in 2000. The survey put the NT's growth rate at 8.2 percent, at least double the rate of all other states. The most populous states, New South Wales and Victoria, should lag just behind the national average. Some analysts are more cautious, contending that further interest rates hikes and a GST-induced slowdown will curtail growth. And the BIS Shrapnel report admits the GST will have some negative impact.
Fuel prices are a potential thorn among the rosy predictions for rural sector exports.
However, Federal Treasurer Peter Costello recently earned the wrath of farmers by refusing to rule out fuel price increases when the GST is introduced. According to leading forecaster Access Economics, a pre-GST spending surge will fuel the Australian economy until July but won't head off an inevitable slowdown. Access predicts underlying consumer price index growth of 0.6 percent in the March quarter and 1 percent in June, with gross domestic product growth arriving at a final figure of 4 percent for 1999-00. Australian companies are optimistic the GST will not drag down profit and employment growth, although many admit they are not adequately prepared for its introduction. Still, the GST's true believers outnumber the skeptics.