On Saturday, Australians went to the polls and for the first time 10 years changed their Government.
On Sunday then PM and Liberal Party leader Scott Morrison acknowledged defeat and on Monday the Labor leader Anthony Albanese was sworn into office as Australia’s new Prime Minister. He pretty much straight away flew to Japan (pictured above) to meet the leaders of the ‘Quad’ (Japan, India, Australia and the USA.)
At the time of writing, it’s still not 100% clear if the new PM will have a majority in Australia’s House of Representatives, there are still a handful of seats to declare and Labor is still a couple short.
What is clear though is that Australians voted for change. The opinion polls turned out the be right in this election and therefore the currency markets saw virtually no movement despite a change in government. The same goes for the stock markets which had factored in a Labor win and change of government.
The new government will bring a leftward shift in economic and business policy over the coming years, most significantly in the areas of climate and energy (detailed below.)
A new approach to energy, industrial and climate policy
For many years now Australia has been in the grip of what many have dubbed ‘the climate wars.’ The country’s coal mines are rich, yet its open spaces and sunny weather also make it ideal for solar and wind power.
What type of country Australia wants to be has been up for debate for years now. Out of all western countries, Australia is the most reliant on coal and this industry has a special place in the heart of many Australian communities. This has made discussion on energy, industrial and climate policy pretty toxic. Nothing sums this up more than the recent images of the then PM Scott Morrison brandishing a physical lump of coal in the House of Representatives chamber during a debate.
This election seems to put an end to this toxic debate though, the pro-coal parties have been squeezed by both Labor, the Greens and a raft of right-leaning yet pro-climate policy independents.
Despite having pretty moderate energy, industrial and climate policies, if Labor fails to secure a working majority we can expect it to be pushed into taking even stronger steps by both the Greens and ‘Teal independents’ as a price for supporting the government.
Many businesses will be watching this carefully to see what any new regulatory impacts may be.
A poisoned chalice?
One of the key reasons for the Liberals being kicked out was that like in most other western nations, Australia is undergoing a cost of living crisis. Inflation currently sits at over 5% and is only expected to get higher.
Prices are rising, wages aren’t keeping up and people are generally pessimistic and gloomy about the future.
People will be watching closely to see what direct action they take to try and stem rising prices. The new Treasurer has got a huge job on their hands to see Australia back to prosperity in the coming years!
Note- Post feature image copyright: 首相官邸, CC BY 4.0, via Wikimedia Commons