Federal Election Fallout: Why Political Uncertainty is Bad for Business.

Market Insights
8 years ago
3 minutes
Hung Parliament? Minority Government? Hostile Senate? A bunch of terms are being thrown around as Australia awaits a verdict after casting their votes in the July 2 election.
With the Coalition and the ALP locked in a close battle to secure seats and form government in the lower house, experts in the property industry fear political instability has the potential to scare off investors, and even affect Australia’s AAA credit rating. 
The Property Council of Australia’s Chief Executive, Ken Morrison, says business doesn’t like uncertainty.
“Our hope is that we end up with a workable Parliament that can deliver the stable government that Australia needs. The property industry will work with whatever party forms government and the rest of the Parliament.”
He’s urged both sides to learn the lessons from 2010, when the ALP formed a minority government with the Greens, and always put Australia’s long-term economic interests first.
“Neither party should think this result gives them a ‘three-year leave pass’ from economic reform. Australia needs policies that generate the prosperity and jobs that our country needs.”
The Australian Financial Review reports Chinese investors are concerned by the election of One Nation’s Pauline Hanson, who last week claimed Australia is being “swamped by Asians”.
Richard Yuan, chairman of the Australia China Entrepreneurs Club told the AFR that “when people heard about Pauline Hanson getting elected, they got nervous.”
"It's very bad for foreign investment. She advocates the white Australian policy. Everybody talked about it when they were thinking about migration and without migration and integration, it's bad for business, and housing."
Stephen Conry, Chief Executive of property agency JLL told the Australian Financial Review that “crossbench chaos would be a disaster for the country.”
“The property sector will remain a massive contributor to our economy and it needs encouragement by strong government nurturing that economy,” he explains.
“As long as instability continues, business confidence, vital for the industry, would wane.”
“Australia’s continued AAA credit rating and investment in infrastructure needs to be the focus of the new government.”
The Australian Chamber of Commerce says it is vital to maintain business confidence.
“Whichever major party forms government, they will need to build a constructive relationship with the crossbench to get things done. This takes goodwill on all sides. The business community is ready to play its part in contributing to the development of sound policies. We cannot afford three more years of policy gridlock,” explains CEO James Pearson.
“The minor party MPs and Senators wake up today with great responsibility on their shoulders. We call on crossbenchers in both the House of Representatives and the Senate to move beyond the narrow agendas on which they campaigned, to make decisions in the national interest.
The Australian Electoral Commission has commenced counting almost a million postal votes which will decide the nation’s fate.
Will it be enough to get the Coalition over the line to form a majority government? Or is it back to the ballot boxes for the people of Australia?
Watch this space.