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Category: Economic Trends

NT economy 'losing momentum', new figures show

Monday, 24 Oct 2016 08:26:40 | Xavier La Canna

Low population growth and the completion of major projects are dragging on the NT economy. (ABC News: James Purtill)

New figures show the Northern Territory's economy is operating well above "normal" levels, but is losing momentum with weak population growth, retail trade and business investment.

The latest quarterly CommSec State of the States report said the NT leads the nation on economic growth, which was up 24.1 per cent compared to normal levels, which is defined as the decade average.

Overall the NT was the fourth-best performing jurisdiction in Australia when a combination of different factors were taken into account.

But momentum in the economy is slowing with annual growth rates on all eight indicators lagging the national average.

"It is showing the loss of momentum," CommSec chief economist Craig James said.

The NT is ranked fourth in the new State of the States report Photo: NSW leads the nation and the Northern Territory is ranked fourth in the new report. (Supplied: CommSec)

In trend terms, which smooths out short-term fluctuations, the economy contracted 8.9 per cent over the past year, compared to a rise of 3.5 per cent for Australia as a whole.

"If you look at annual growth figures of the eight indicators that we look at, the Northern Territory is basically lagging the nation in all eight," Mr James said.

"Over the past year we can see the Northern Territory's economy has gone backwards."

Mr James said low population growth and the completion of major resource projects were dragging on the local economy.

"If you don't get people coming to the Territory you don't need to build as many homes, it affects retail spending, it affects basically the broader economy," Mr James said.

"With the looming slowdown in terms of the gas sector, and new construction, you are going to have to find that next factor to drive economic growth."

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