The state of Queensland has launched the sale process for five key infrastructure assets with a combined value of A$15 billion (€8.6 billion; $12.1 billion).
Port of Brisbane
The assets being made available include Queensland Motorways, the Port of Brisbane’s shipping terminal, timber producer Forestry Plantations Queensland, Queensland Rail’s coal haulage and non-passenger businesses and the Abbott Point Coal Terminal. Queensland Rail’s passenger service assets will remain under state control. The Port of Brisbane’s major land holdings, which have been earmarked for development, could also potentially be put up for sale.
State premier Anna Bligh said the asset sales were imperative in addressing Queensland’s A$14 billion budget shortfall over the next four years, which she said was caused by the global financial crisis. Bligh said she has no apologies for doing “whatever is necessary” to ensure the continued delivery of jobs and key infrastructure over that period.
The asset sales are expected to take place over the next three to five years. In addition to delivering estimated proceeds of A$15 billion, the process is also expected to help the state government avoid a further A$12 billion in capital investment over the next five years.
The proposed asset sales have understandably aroused considerable interest among infrastructure investors.
Australian infrastructure investment firm CP2 welcomed the state’s decision to sell the assets. CP2’s managing director Peter Doherty applauded the “brave action” taken by the Queensland Government and said that all stakeholders, including governments, taxpayers, employees, users, owners and operators, will benefit from private ownership of the assets.
The Abbott Point Coal Terminal is not the only coal terminal in the state to be up for sale. Babcock & Brown Infrastructure is currently in the process of selling its 49 percent stake in the Dalrymple Bay Terminal, located near Mackay.
The perilous state of Queensland’s finances was highlighted by data released today by the Australian Bureau of Statistics. The state’s final demand for the quarter ending March 2009 fell 1.4 percent, compared to a decline of 0.3 percent for Australia as a whole. Queensland’s economy had previously grown, albeit marginally, by 0.3 percent and 0.1 percent during the prior two quarters.
Queensland also experienced a decline in private investment of 4.5 percent during the past quarter, while this investment in the entire nation grew by 3.7 percent over the same period.