The Northern Territory will experience the nation’s weakest economic growth as cost of living soars, according to data from the NT Government’s Department of Treasury and Finance, which shows the consumer price index (CPI) rising to a whopping high of six per cent for the fiscal year ending June 2022, with economic growth only expected to increase by 0.2 per cent for the period.

Deloitte Access Economics, using government statistics, estimates the Territory’s gross state product (GSP) to grow by only 0.2 per cent for the period, against the national economy which is seen to expand by around 3.3 per cent at the end of the fiscal year.

“The Territory is expected to experience the weakest economic growth of the jurisdictions in 2021-2022, which otherwise range from an estimated increase of 1.4 per cent in the Australian Capital Territory to 5.6 per cent in Tasmania,” the report said.

Darwin’s CPI—the instrument used to measure inflation—is estimated to increase by a massive six per cent for the period, the highest of all jurisdictions.

Australia’s inflation sat at 3.9 per cent, its highest level since mid-2014 when it increased by 2.6 per cent. Record high fuel prices are one of the main factors for the recent increase.

The Territory’s labour sector also suffered along with a decline in economic growth with the unemployment rate forecast at the average of 3.7 per cent over the five years ending this fiscal year.

Employment growth in the Territory is estimated to increase by only 0.2 per cent for the period versus the national economy’s three per cent growth. In the last five years ending this June, the NT’s employment growth is forecasted to average 1.6 per cent annually.

In other jurisdictions, annual employment growth is seen to range from 0.9 per cent in South Australia to two per cent in Western Australia and Queensland. Nationally, employment growth is forecast to average 1.8 per cent per annum over the same period.

Deloitte expects growth across all jurisdictions to be within a narrow range over the next five years, with the NT economy expanding at an average rate of 2.8 per cent annually, compared with the lowest 2.3 per cent annual economic growth in South Australia to 3.4 per cent growth in Victoria.

The national economy is forecast to grow at an average rate of three per cent annually over the same five year period.

Deloitte noted that attracting private investment will be the key economic driver for the Territory’s growth over the next five years led by private engineering and commercial investment, which is expected to go up by an average rate of 16.9 per cent annually and private equipment investment, growing by 9.3 per cent per annum.

Private housing investments, however, are expected to decline at an average rate of 4.2 per cent annually.

The Territory’s tourism sector remains uncertain as international tourists’ arrivals are not expected to return to pre-pandemic levels until 2024.