Kingscote Airport Business Case Appendices - Kangaroo Island ...

Kangaroo Island Futures Authority Draft Economic Impact of Agriculture and TourismIntroductionEXECUTIVE SUMMARYThe economy of Kangaroo Island is largely based on agriculture, tourism and, to a lesserextent, fishing. These key economic drivers are supported by a range of service industries,particularly in the areas of services to agriculture, accommodation and business services.Current ContributionThe Island’s economic base is expanding with the potential for increased tourism beingrecognised and with new industries being targeted, including horticulture, aquaculture andsustainable development (e.g. renewable energy, wind farms).Future Growth ScenariosThis study has undertaken economic impact modelling and scenario analysis for both thetourism and agricultural industries on Kangaroo Island. The impact analysis takes account ofthe implications of economic development for population growth and the related effect on thehealth, education and other service sectors.Economic impact modelling has been prepared for low, moderate and high growth scenarios intourism and agriculture over an 8 year period, from the baseline year of 2011/12 to 2019/20.A desk top study of planning and policy documents provided an indication of the level ofalignment with key government and industry priorities, and targeted stakeholder consultationprovided a confirmation that growth targets were realistic.Industry growth was seen to span three time frames: short term (0-4 years), middle term (5-9years) and longer term (10 years plus).Tourism sector growth at rates equivalent to trend or better were seen by stakeholders aspossible in the short term with limited major investment required. Growth was seen initially tobe driven by innovation (technology, management and marketing) and the take up of sparecapacity in infrastructure and service provision.Growth for tourism in the middle to longer term was focused on new market development,particularly in domestic overnight stay and international markets. This growth would befacilitated by major milestone investment such as an upgrade of Kingscote Airport,development of new tourism experiences and accommodation and an upgrade to utilities suchas power and water supply.Potential growth in the agriculture sector was based on four main drivers: increase inproduction (productivity), reduced costs (logistics), Branding premium and change in land use(horticulture and other agriculture).Short – medium term growth drivers for agriculture are based on innovation, for example arise in productivity due to use of technology and management, as well as marketing anddeveloping brand premiums. Middle to longer term growth, like tourism growth, appeared torely on major milestone investment in infrastructure like bulk handling or value addingfacilities or the knock on effect of reduced costs as a result of improvements to thedevelopment of access arrangements.e c o n s e a r c hPage| vi