Comments by economic forecaster BIS Shrapnel have underscored the importance of South Australia’s manufacturing sector to its overall economic growth.
The manufacturing sector is the biggest industry in the state, with roughly 70 per cent of what is exported from SA being manufactured.
BIS said that SA’s economy would lag behind the rest of the country’s, with exchange rates playing a leading role in this.
"Essentially the Australian dollar remains high and that's really hurting the manufacturing sector, which is very important for the South Australian economy," a senior economist with the firm, Tim Hampton, told the ABC.
A lot depended on where upcoming federal defence contracts went.
"What will be critical for the outlook though will be the extent to which the Federal Government uses the South Australian manufacturing industry to support such areas as defence," said Hampton.
“If those projects continue to go to South Australia then the outlook does start to improve."