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E-commerce underpins growth.

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E-commerce underpins growth The Minister for Communications, Information Technology and the Arts, Senator Richard Alston said today that e-commerce will add 2.7 per cent to Australia's GDP at the release of a ground-breaking e-commerce report at the Innovation Summit in Melbourne.

'This ground-breaking research once again confirms the magnitude of opportunities that e-commerce is likely to bring to all Australians and illustrates how far-reaching the effects will be,' said Senator Alston.

'The report forecasts that e-commerce will add 2.7 per cent to Australia's Gross Domestic Product over ten years to 2007. E-commerce underpins major productivity improvements which makes possible simultaneous increases in wages and employment. The report predicts real wages would rise by 3.5 per cent with aggregate employment rising by half a per cent as a result of e-commerce.'

'The report confirms that further productivity gains in industry sectors as a result of e-commerce developments will have flow on implications for education and training, as they meet the challenges of the information society.'

E-commerce beyond 2000, is the final report of a study commissioned by the National Office for the Information Economy (NOIE) in partnership with 13 companies. A consulting team comprising the Allen Consulting Group, the Monash Centre of Policy Studies, ETC and Acuity Consulting drew on the expertise of the partner companies and others to identify key changes e-commerce is likely to introduce. These changes were then quantified and their impact analysed using a computer model of the economy.

'This was a pilot study that focused on key sectors and made use of existing data available. The quantitative analysis used was supplemented by qualitative case studies of key sectors to provide a balanced approach.

'There is a lot of hype surrounding e-commerce with huge figures regularly predicted for aspects such as consumer spending on the Internet. This study is the first attempt to systematically and rigorously analyse how e-commerce will affect specific sectors and its implications for issues such as employment, economic growth and exchange rates.'

'While this study has limitations inherent in any pilot study, it is valuable in terms of providing insights and starting the debate and encouraging others to take up further research.

'I compliment the companies involved in the project for entering into such a bold exercise. They have established a precedent for joint research. This approach is now being used in a follow up study commissioned by NOIE and the States and Territories to examine the economic impacts of e-commerce on regional and rural Australia,' said Senator Alston.

The report is available at

Media Contact: Terry O'Connor or Sasha Grebe 02 6277 7480 (office) 0419 636 879 (ah) Website: 008/00

10 February 2000

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