Queensland Treasurer Tim Nicholls. Photo: Harrison Saragossi
Queensland Treasurer Tim Nicholls predicts the United States economy will recover strongly next year based on the country's massive reserves of yet-to-be tapped shale gas.
Mr Nicholls has also predicted the country would dramatically cut back cut back its oil and gas imports, changing its position in the world as an importer of fuels.
"It is quite conceivable that the US could be energy independent within the next decade," Mr Nicholls said yesterday.
"And that changes a whole range of things in the world. It changes their geopolitical status.
"It doesn't mean they need to keep the Sixth Fleet always off the Arabian Gulf."
Mr Nicholls said shale gas could provide reserves of cheaper electricity which could drive its manufacturing base.
"I think the story of US shale gas and energy independence will drive a resurgence in America that we really have not fully understood yet."
However, Mr Nicholls said it must first tackle its "fiscal cliff" dilemma, where government legislation forces cuts to government spending to reduce the US budget deficit at the end of 2012.
Many observers believe the legislation will stall the economy.
Speaking at the Queensland Business Forum yesterday, shortly before President Barack Obama was re-elected, Mr Nicholls said there were already "green shoots" showing the US economy would recover.
"I think the United States is poised for recovery," Mr Nicholls told delegates at the Institute of Chartered Accountants function at Brisbane Exhibition and Convention Centre.
"Once we get through the election cycle today and see an outcome, the US will start to address some of its major issues."
Mr Nicholls said amendments would be found to ease those government spending cut backs.
"I think they will have resolve that and I think they will have to borrow more to do that, but I think they are in a reasonably strong position to do so," Mr Nicholls said.
He predicted the US economy will grow in the third quarter "outside of 2 per cent, quarter by quarter," compared to market predictions of 1.8 per cent.
Queensland Treasury predicts growth to return in US household land approvals.
"For the first time last quarter household land approvals lifted according to some news circles," he said.
"And that will be a driver of economic growth there."
Mr Nicholls said there would be rebuilding activity after Hurricane Sandy.
But he said the biggest boost to the future US economy would come from shale gas.
"The story of shale gas has not been well understood outside the US," he said.
The US has about 100 years of shale gas reserves, although there is a public debate over environmental concerns about extracting some reserves.
Later, in his acceptance speech in Chicago, Mr Obama mentioned his desire to wind back America's reliance on "foreign oil" as one of his key priorities.
"In the coming weeks and months I am looking forward to reaching out and working with representatives of both parties to meet the challenges we can always solve together," he said.
"Reducing our deficit, reforming our tax code, fixing our immigration system, freeing ourselves from foreign oil.
"We have got more work to do."