Blizzard daniel

More than half of Australian businesses expect the political environment to impact their ability to grow during 2018, new research has warned.

SMEs and businesses in the electricity, gas and water sector are particularly sensitive to the political environment, according to Alleasing.

Around 80% of businesses in these sectors expect some political impact on their business in the coming 12 months.

Alleasing’s Equipment Demand Index reveals that, overall, 70% of SMEs anticipate politics will have an impact on their growth, suggesting more than one million of Australia’s two million SMEs believe they will be affected.

However, the majority of larger businesses (69%) say they expect to be unaffected by political issues in the country.

Alleasing said that political decisions around managing the impact of climate change, migration, employment regulations and taxation can have a big impact and drive investment decisions.

Daniel Blizzard, chief executive at Alleasing, said: “Our research shows that politics is impacting different businesses in different ways.

“For SMEs, confidence is critical. On a national scale, the political impasse in the energy sector is clearly impacting business sentiment. Our research also shows political nervousness in the finance sector, with 66.7% of businesses stating that politics will have an impact on their operations.”

The headline Index result found that nearly 27% of all businesses plan to make asset acquisitions in the final quarter of 2017, down slightly from nearly 29% in the previous quarter.

Although businesses are planning acquisitions, the number who say they are operating with assets they consider outdated, and are hindering productivity, has doubled this year from 11.6% in January 2017 to 22.4% currently.

Blizzard added: “When businesses under-invest in their equipment they are often left with unproductive or less efficient technology.

“If this trend continues, Australian businesses will lose out to their competitors, particularly as many businesses across the globe continue to update their technology at a rapid pace.”