Yesterday we had the release of the Bureau of Resources and Energy Economics (an economic research unit within an Australian government department) have released their April 2013 report Resources and Energy Major Projects (yesterday’s post here).
Australian press are covering this today, reporting on the bleak outlook and what it means for the broader economy also.
- resources construction boom has peaked and is likely to fall sharply over the next 5 years
- $350 billion in committed and potential projects may fall to $25 billion in 2018
Economists said the difficult economic transition would take years because other parts of the economy wouldn’t cover the fall in resources investment. Interest rates will stay low because of weak economic activity.
None of this is new news, however. The drying up of mining capex has been a concern of the RBA and the markets for a long time now.
Australian Financial Review (gated)
