TCV: Document

Overview of the Economy

In 2004-05, Victoria's total Gross State Product (GSP) was $217 billion, 2.3% higher than the previous year. Victoria's share of national GDP was 25%, equal to its population share. Per capita, GSP in Victoria in 2004-05 was $43,447, 2.4% higher than the national average and the third highest per capita GSP among the States of Australia.

Victoria has a substantially diversified economy and is the leading Australian State in terms of manufacturing output. It is, however, predominantly a service economy, with service industries accounting for around four fifths of total Victorian GSP in 2004-05. The mineral production and agriculture sectors make a smaller contribution to the Victorian economy than in other Australian states.

Victorian Total Factor Income (TFI) by Industry Sector
(A$ millions, current prices)

2002-03
2003-04
2004-05
Share of Victorian TFI 2004-05 (%)
Share of Australian Industry TFI 2004-05 (%)
Primary production (agriculture & mining)
7,900
9,412
8,930
4.6
13.0
Manufacturing
26,574
28,885
29,946
15.4
30.5
Other (including services)
136,283
146,236
155,396
80.0
24.9
Total
170,757
184,533
194,272
100.0
24.6

Source: Australian Bureau of Statistics

Despite continued growth in the manufacturing sector in Victoria, manufacturing’s share of GSP in the economy has fallen from around 20% in 1989-00 to around 15% in 2004 05, due to relatively stronger growth in the service industries. In terms of employment, the largest growth sectors of the economy over the past ten years have been property and business services, mining, construction and health and community services. The share attributable to agriculture has declined from a peak of around 6% in 1984-85 to 3% in 2004-05.

Victoria relies slightly less than most other States on internal spending and more on interstate trade to sustain economic activity. Net interstate exports account for a higher proportion of GSP in Victoria than in most other States. Exports of goods from Victoria to the rest of Australia include crude oil, food and beverages, textiles, clothing and footwear, paper products, chemicals, metal products, motor vehicles and consumer goods. Victoria is also an exporter of legal, accounting, computing, advertising and other business services to the rest of Australia.

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Victorian Total Factor Income (TFI) by Industry Sector (A$ millions, current prices)
	2002-03	2003-04	2004-05	Share of Victorian TFI 2004-05 (%)	Share of Australian Industry TFI 2004-05 (%)
Primary production (agriculture & mining)	7,900	9,412	8,930	4.6	13.0
Manufacturing	26,574	28,885	29,946	15.4	30.5
Other (including services)	136,283	146,236	155,396	80.0	24.9
Total	170,757	184,533	194,272	100.0	24.6