Australia's project investment pipeline at record high despite global uncertainty
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The news: The value of Australia's project investment pipeline has reached a record $1.2 trillion, according to Deloitte Access Economics’ Investment Monitor, despite ongoing global uncertainty.
The numbers: Total planned project value, which counts 1,722 projects worth at least $50 million, increased by 9% year-on-year, almost entirely driven by “a surging pipeline of clean energy projects”, according to the report.
The utilities sector accounts for 37% of planned projects and 16% of definite projects in the database. The transport sector still makes up the largest share of definite activity, but its value has fallen a third since 2020.
The total value of projects in the database rose by 2.7% over the June quarter, as $25 billion worth of new projects offset the $15 billion worth of completions and deletions in addition to net upward cost revisions of $22 billion amid budget blowouts.
Public sector projects and public-private partnerships accounted for more than 80% of the new project value added over the June quarter.
The release of state government budgets for 2025-26 also contributed to a lift in new public investments.
The context: The Deloitte report flagged that “global headwinds are likely to weigh on business investment in the short term” as it remains “unclear whether tariffs will cause a one-off price rise or have a lasting effect”.
As future demand forecasts become harder to predict, many businesses may “adopt a wait-and-see approach, delaying major commitments until conditions stabilise”, according to the report.
However, Deloitte expects domestic conditions of disinflation, a strong labour market and anticipated interest rates cuts to be conducive to investment.
It also flagged that Australia’s AAA credit rating from all three major agencies will “support a healthy medium-term investment outlook” and provide stability as uncertainty persists.
What they said: “The investment outlook is mixed in the short term,” Deloitte Access Economics associate director and lead author of the report Sheraan Underwood said.
“Ongoing global uncertainty will weigh on internationally exposed firms. But domestic conditions are improving – with easing inflation, falling interest rate expectations, and signs of a recovery in household spending," Underwood said.
“Looking further ahead, Australia remains well placed to attract global capital. Our stable institutions, skilled workforce and growing opportunities in clean energy and technology provide a solid foundation for growth.”
The source: Deloitte Investment Monitor
