The Insider/
Diversify or Drift

It is commonly understood that economic uncertainty and the rise of populist politics are threats to the state’s long-term economic diversification agenda. Voters who feel insecure want immediate relief, not decade-long industrial strategy. A government facing a populist campaign and a cost-of-living-weary electorate will be tempted to trim its ambitions, defer the patient work of building new industries and concentrate on the near-term politics of reassurance. 

It is a reasonable assumption to hold and represents a major risk for proponents engaged in the energy transition and attempting to deliver economic diversification.  

Leaning into insecurity 

The economic anxiety showing up in Western Australian polling is not random. It is the predictable product of an economy that remains, despite twenty years of talk about diversification, heavily concentrated on mining, despite a quadrupling in size. 

Largely and relative to other jurisdictions, the economy is performing strongly. However, when a state’s prosperity rests on a narrow base of commodity exports, workers, households and regional communities are all exposed to the same volatility.  

A price cycle in a single sector can quickly become a household budget problem. A downturn in one industry becomes a town’s existential question. The insecurity that populist politics monetises so effectively is the insecurity of an undiversified economy. 

The present risk facing proponents is that economic diversification can be framed as a luxury the state can afford only in calm political weather. Economic diversification is the most direct structural answer to the conditions fuelling their anxiety.  

A state with a broader industrial base that has more sectors generating skilled employment and more pathways to secure work is less exposed to the shocks that drive political volatility. Strategic Industrial Areas, investment attraction, and the build-out of new industries are not abstractions floating above the cost-of-living debate. They are the long-term hedge against precisely the volatility that debate reflects. 

The temptation, in a moment like this, is to read the populist surge as a signal to slow down, or even turn back. What is actually needed is for government, industries and communities to lean into the hard work of change, because the surge is itself a symptom of the very concentration that diversification is designed to cure. 

Why the long game is hard to defend 

 Economic diversification operates on a timescale that is fundamentally mismatched with the political cycle now bearing down on it. A Strategic Industrial Area takes years to permit, tenant and bring to productive life. An investment attraction pipeline pays off across a decade or more. The jobs created by a new industrial precinct arrive slowly, often after the government that enabled them has faced the electorate more than once. The benefits are deferred, which means they are frequently invisible at the household level until long after the decisions that produced them. 

Populist politics, by contrast, trades in the immediate and the tangible. It offers voters something they can feel, if not fully realise, now. A government trying to defend a long-horizon economic strategy against that appeal is fighting on unfavourable terrain, asking an anxious electorate to be patient at precisely the moment patience feels least affordable. A state that defers its diversification agenda every time the political weather turns rough will never diversify at all, because the political weather is rarely calm for long. Worse, it would be surrendering the one strategy that actually addresses the structural insecurity feeding the populist moment, in favour of short-term relief that leaves the underlying exposure unaddressed.  

Holding the line on diversification through a politically turbulent term is not stubbornness. It is the recognition that the alternative is a slow drift back toward the concentrated, exposed economy that produced the turbulence in the first place. 

The translation problem 

ReGen Strategic works with proponents, investors and industry bodies to focus on seizing these moments of opportunity. 

In the current environment, the burden has shifted onto proponents to translate long-horizon strategic projects into near-term, tangible, localised benefit. A project justified purely on the basis of its contribution to a decade-away industrial vision is a hard sell in a climate where every dollar of public support is being weighed against immediate household pressure. The same project is more easily defended in terms of the jobs it creates in a specific community, the regional investment it anchors and the local supply chains it activates. 

The projects that will prosper in this environment are the ones whose proponents can show, credibly and specifically, that patient industrial strategy and immediate community benefit are the same goal viewed over different timescales.