Impact on Gross State Product and of capital expenditure would be expected to contribute more than a dollar in Gross State employment Product. Ports are critical international gateways for the import and exports of goods. Efficient supply By comparison modelling estimates that for every chains support economic growth, help Victoria to dollar of capital expenditure on a new Bay West maintain its competitiveness and increase its port there in an increase in Gross State Product of productivity. $1.06. The impact of Bay West on Gross State Product is of marginal benefit, but it is much greater Gross State Product is the measure of Victoria’s than Hastings. Table 23 summarises these results. overall economic output. It is the sum of the Deciding to build a second port will affect state market value of all final goods and services employment. The total level of state employment is produced by industries within Victoria. We impacted by the one- off investment during planning assessed how moving the port to either Hastings and construction of a port. or Bay West impacted Victorian Gross State Product relative to the investment required to build There is also a long-term employment impact from the port at these locations. The numbers changes in operating efficiency and traffic flows. presented were estimated against a base case of Building a new port at either location will create continuing to satisfy demand at the Port of around 2,000 direct jobs. In both locations, the Melbourne. ongoing operation of the port and related industries would attract thousands of jobs to the region Results the port is located in. Although our analysis Our modelling estimates that for every dollar of demonstrated overall net job creation is not a capital expenditure in a new port at Hastings there significant differentiator between locations. See is an increase in Gross State Product of 44 cents. GHD Concept Options Bay West and Hastings, – This is not an economically efficient investment, Deloitte, Economic Advice, 2017, and Deloitte, as the increase in Gross State Product is 56 cents Multi-criteria assessment (MCA), 2017 reports for less than the capital investment in the new port. further information. For an economic asset such as a port, every dollar Table 23. Bay West and Hastings impact on Gross State Product Bay West Hastings Victoria Victoria Incremental capital expenditure 3.30 B 7.73 B ($ billion, PV) Impact on Gross State Product 1.06 B 0.44 B relative to investment required Source: Deloitte, Infrastructure Victoria Second Container Port Advice economic advice, 2017.
Impact on Gross State Product and employment Ports are critical international gateways for the import and exports of goods. Efficient supply chains support economic growth, help Victoria to maintain its competitiveness and increase its productivity. Gross State Product is the measure of Victoria’s overall economic output. It is the sum of the market value of all final goods and services produced by industries within Victoria. We assessed how moving the port to either Hastings or Bay West impacted Victorian Gross State Product relative to the investment required to build the port at these locations. The numbers presented were estimated against a base case of continuing to satisfy demand at the Port of Melbourne. Results Our modelling estimates that for every dollar of capital expenditure in a new port at Hastings there is an increase in Gross State Product of 44 cents. This is not an economically efficient investment, as the increase in Gross State Product is 56 cents less than the capital investment in the new port. For an economic asset such as a port, every dollar of capital expenditure would be expected to contribute more than a dollar in Gross State Product. By comparison modelling estimates that for every dollar of capital expenditure on a new Bay West port there in an increase in Gross State Product of $1.06. The impact of Bay West on Gross State Product is of marginal benefit, but it is much greater than Hastings. Table 23 summarises these results. Deciding to build a second port will affect state employment. The total level of state employment is impacted by the one- off investment during planning and construction of a port. There is also a long-term employment impact from changes in operating efficiency and traffic flows. Building a new port at either location will create around 2,000 direct jobs. In both locations, the ongoing operation of the port and related industries would attract thousands of jobs to the region the port is located in. Although our analysis demonstrated overall net job creation is not a significant differentiator between locations. See GHD Concept Options – Bay West and Hastings, Deloitte, Economic Advice, 2017, and Deloitte, Multi-criteria assessment (MCA), 2017 reports for further information. Table 23. Bay West and Hastings impact on Gross State Product Bay West Hastings Victoria Victoria Incremental capital expenditure ($ billion, PV) 3.30 B 7.73 B Impact on Gross State Product relative to investment required 1.06 B 0.44 B Source: Deloitte, Infrastructure Victoria Second Container Port Advice economic advice, 2017.
Advice_on_securing_Victorias_ports_-_accessible_version_-_FINAL.docx