Australia's 40-Year Economic Plan: AI as a Growth Engine

Australia has unveiled a comprehensive 40-year economic strategy, emphasizing the pivotal role of artificial intelligence (AI) in driving growth. Released by Treasurer Jim Chalmers, the 2026 Intergenerational Report forecasts that AI could contribute between A$95 billion and A$116 billion to the country's GDP by 2036, representing a 2.6% to 3.2% increase in national output within the next decade.

The report also highlights the potential for job creation, estimating that AI integration could result in 36,000 to 44,000 new jobs by 2036. This counters the common belief that automation leads to job losses. The Australian government has already committed over A$460 million to AI initiatives, which include infrastructure development and skills training programs.

Furthermore, the report anticipates a substantial investment in data centers, projected to reach approximately A$150 billion by 2030. Demographic trends are also addressed, with life expectancy expected to rise, creating a demographic challenge as fewer children are born.

Central to these projections is Australia’s National AI Plan, initiated in 2025-2026, which focuses on infrastructure, workforce skills, and risk management. For investors, the immediate focus will be on the execution of infrastructure spending and skills programs, rather than the long-term GDP projections.