Drought, regions and the Australian economy between 2001-02 and 2004-05

During 2002 Australia experienced a severe drought that has been one of the most widespread on record. The drought is expected to have a severe impact in 2002-2003 on agricultural output which on average is expected to be almost 30 per cent lower than the base case. Flow-on effects to the rest of the economy are expected to lower real GDP growth by a further 0.6 percentage points, leading to a total negative impact of the drought on GDP of 1.6 per cent. All mainland states of the economy are projected to experience a significant reduction in their gross state product and employment as a result of the drought. Given the widespread nature of the drought, all of Australia's most agricultural intensive regions are projected to be severely affected. The 17 worst-affected regions include all 14 of Australia's regions that had 20 per cent or more of their output in the agricultural sector