Two senior members of Lavan Legal’s Recovery, Insolvency and Reconstruction Team attended the Turnaround Management Association’s National Conference last week in Melbourne.
Our overall impression gleaned from the conference was that we’re experiencing (and likely to continue to experience) a multiple speed economy driven by hugely disparate industries and indicators.
Australia is enjoying the benefits of low housing interest rates and yet construction of new houses is still slow. There was a jump in business confidence levels following the election but manufacturing and retail have, and will continue to, struggle – consumers are still scared and discretionary spending is low. The initial phase of the mining boom is well and truly over, having moved into the export stage and there’s certainly no secret that mining services is an industry in trouble as a result.
There’s optimism around agriculture and food production (especially in the context of foreign investment) but will it be enough to plug the hole left by the end of the mining boom?
Lavan Legal comment
In such a volatile environment, businesses are well advised to identify financial, debt or operational issues before the business loses its way. It’s far better to stabilise and then decrease risk than to cross one’s fingers and hope the problem will fix itself.
