The Business Council has today released a landmark new global index, which found Australia ranked 21st out of 42 countries on investment competitiveness, with the report providing a roadmap of key actions needed to achieve a top 10 ranking.
The BCA’s Global Investment Competitiveness Index 2026 draws on 17 international indexes across seven key areas that collectively determine whether investment comes to Australia or goes offshore, including trade, regulation, energy, business taxation, investment restrictions, rule of law and labour settings.
Business Council Chief Executive Bran Black said Australia has many of the ingredients needed to be successful in the global contest for investment, but with competition intensifying and long-term productivity challenges, Australia must move fast to become a top 10 investment competitor and secure better living standards for future generations.
“This isn’t about chasing rankings, it’s about securing the investment that creates jobs, lifts wages and stronger living standards for all Australians,” Mr Black said.
Mr Black said Australia ranked 2nd on trade settings, which was important given the increasingly uncertain global trading environment and, with one in four Australian jobs dependent on trade, it is fundamental to our economic success.
“Australia’s trade success continues to be driven by significant policy reform across tariff reductions and trade agreements, whereas we fall down on regulation and business taxation, and so our ranking could surge with policy change in these areas.”
Australia’s latest rankings are:
- Trade – 2nd
- Rule of Law – 10th
- Energy – 11th
- Regulation – 37th
- Business taxation – 38th
- Investment restrictions – 38th
- Labour market settings – 17th
In relation to regulation, to improve Australia’s overall ranking, the BCA considers Government should cut regulatory costs by 25 per cent by 2030, backed by a national red tape stocktake and stronger oversight.
“AICD research shows it now costs Australian businesses $160 billion a year to comply with federal regulation, and reducing this should be low-hanging fruit to reduce costs for consumers and businesses,” Mr Black said.
To become a top 10 investment destination, the BCA says Australia must:
- Cut regulatory costs by 25 per cent by 2030.
- Fast track low-risk foreign investment, while focusing scrutiny on genuinely sensitive transactions.
- Implement targeted incentives like an investment allowance or accelerated depreciation to make investment in Australia stack up better when compared against opportunities in other countries.
- Continue the modernisation of trade systems, including the delivery of a national Trade Single Window and removing remaining nuisance tariffs.
- Restore balance and flexibility in labour engagement, and simplify modern awards to better support productivity and wage growth.
Mr Black highlighted the importance of improving settings to support investment by large businesses, given the outsized influence of their investment on the nation’s overall productivity performance.
“Large businesses often operate globally and they are the same businesses that employ 4.7 million Australians, or one third of the workforce, and make up around 75 per cent of investment. If we want Australia’s productivity to improve, it’s these businesses we must target most for more investment.”
“We must remember that global capital is mobile and increasingly contested. Investors compare jurisdictions side by side. If other countries are making it simpler and more attractive to invest, making simple once-off changes won’t be enough on their own, we need to outpace and keep outpacing our main competitor countries – Australian jobs rely on it.”
“The countries that consistently come out on top, being places like Finland, Ireland and Sweden, combine competitive tax settings, simpler and more predictable regulation, strong institutions and high performing labour market settings, keeping barriers to investment low,” Mr Black said.
Table 1: Australia’s BCA Global Investment Competitiveness Index rankings
Table 2: BCA Global Investment Competitiveness Index – leaderboard
