Expenditure approach: GSP (E)

State final demand

In 2018-19, the Territory’s state final demand (SFD), which measures total domestic expenditure within the local economy, fell by 16.2% to $24.6 billion. The fall in SFD was driven by a decline in private business investment, primarily due to the completion of the construction phase of the INPEX LNG plant.

SFD is expected to fall by 1.7% in 2019-20, before rising to 0.3% in 2020-21.

The continued weakness is due to moderating private sector investment, although receiving some support from smaller scale projects in the investment pipeline. In addition, support will come in the form of increased public investment from the NT Government and defence spending.

With the completion of the construction phase of the INPEX LNG project, business investment is forecast to moderate to the long-term average.

Northern Territory SFD value and YoY growth rates, inflation adjusted - see above for detailed description of graph.
Source: Australian Bureau of Statistics catalogue number 5220.0; Department of Treasury and Finance

Northern Territory state final demand components growth - see above for detailed description of graph.
Source: Australian Bureau of Statistics catalogue number 5220.0; Department of Treasury and Finance

Source: Australian Bureau of Statistics catalogue number 5220.0

Consumption

In 2018-19, consumption expenditure (public and private) comprised 77.1% of SFD. Total consumption expenditure fell by 1.0% to $19.0 billion, driven by a 1.1% decline in household consumption to $11.0 billion and a 0.8% decline in public consumption to $8.0 billion.

The main categories that contributed to the decline in household consumption were:

  • hotels, cafes and restaurants (down by 5.6% to $1.3 billion)
  • recreation and culture (down by 3.3% to $1.0 billion)
  • alcoholic beverages and tobacco (down 3.4% to $0.4 billion).

Partially offset by increases in:

  • rent and other dwelling services (up by 0.3% to $2.9 billion)
  • miscellaneous goods and services (up by 1.1% to $1.9 billion)
  • food (up by 0.8% to $1.02 billion).

State and local government consumption was the main contributor to the fall in government consumption, down 2.7% to $4.8 billion.

Growth in household consumption will moderate over the next few years, before picking up in the outer years as the economy strengthens.

Source: Australian Bureau of Statistics catalogue number 5220.0

Investment

In 2018-19, total investment was $5.6 billion of which $4.0 billion was private sector investment (70%) and $1.6 billion was public sector investment (30%). Total investment decreased by 44.8%, primarily due to a 53.5% fall in private investment. Public investment marginally decreased by 0.4%.

Private business investment is the largest component of private investment and the value of business investment was $3.2 billion, 82% of total private investment and 58% of total investment.

Private business investment is forecast to be lower due to the completion of the INPEX construction phase, and current private investment projects and government capital expenditure are not large enough to offset the fall in total private investment including private business investment.

However, over the medium term, there is a pipeline of major projects in various stages of the approval process, which will support investment and economic growth.

Northern Territory investment, inflation adjusted - see above for detailed description of graph.
Source: Australian Bureau of Statistics catalogue number 5220.0; Department of Treasury and Finance

Source: Australian Bureau of Statistics catalogue number 5220.0

International and interstate trade

International trade

In 2018-19, net exports of goods and services increased by 117.9% to $5.7 billion. This was primarily driven by an increase in merchandise exports of 33.2% to $8.1 billion, offset by a decline in merchandise imports of 29.8% to $2.4 billion. Services exports increased by $6 million to $0.7 billion, while services imports decreased by $149 million to $0.6 billion.

International exports are set to increase significantly over the next couple of years largely due to increased LNG exports from the Territory.

Northern Territory international trade, inflation adjusted - see above for detailed description of chart..
Source: Australian Bureau of Statistics catalogue number 5220.0; Department of Treasury and Finance

Source: Australian Bureau of Statistics catalogue number 5220.0

Interstate trade

The Territory has a large trade deficit with other Australian jurisdictions. The net interstate trade data is part of the ‘balancing item’ in the ABS national accounts. It is estimated that over 90% of balancing item is attributable to interstate trade. In 2018‑19, the balancing item was negative $1.9 billion.

Last updated: 22 January 2020

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