Australia must boost global competitiveness or risk reduction in living standards: business lobby

Australia needs to increase its global competitiveness if it is to maintain its high living standards, the Australian Chamber of Commerce said on Wednesday in a warning to politicians campaigning on the strength in the local economy.

Over the past decade, Australia has dropped out of the top 10 to be ranked 21st on the Global Competitiveness Index, leading to less investment, fewer jobs and missed opportunities in a national economy that's at a crossroads in transition, the chamber's chief executive James Pearson said in a statement.

"Australia's global competitiveness must improve or we risk sacrificing the high living standards which we, our parents and our children have come to expect," Pearson said.

"We cannot be complacent. That's why in this election campaign, it is so important that leaders and parties commit to policies that will allow us to become more competitive."

Both of Australia's major political parties are in a tightly fought national election campaign, to be held on July 2, over their views to strengthen the local economy through a difficult transition from mining-led growth. .

But no matter who gets the privilege to form the elected government in Australia, there must be commitment to sensible reform and demonstrate economic responsibility to "allow us to compete in the global market place," Pearson said.

Pearson criticised the increasing pork barrel spending commitments made by the major political parties in marginal electorates as "every dollar of additional debt places a bigger burden on future generations".

"Every dollar of additional tax drags down growth by discouraging effort and enterprise," Pearson said.

"We don't want a two-tier tax system and believe the eventual target of 25 percent, for businesses of all sizes, is what the country needs to stimulate investment to encourage growth and to generate more jobs," Pearson told News Corp. Endit