A NSW government blueprint shows it could be the nation's first trillion-dollar economy by 2030 and hit $2 trillion after 2040.
The blueprint, released by Treasurer Dominic Perrottet on Wednesday, says the growth in Asia's middle class has the potential to drive NSW exports and economic growth for decades.
The NSW economy by 2040 is expected to be 70 per cent larger than in 2019, the state government says.
Industries most likely to grow include finance, mining, tourism, cybersecurity, medical technology, food production and agricultural technology, aerospace and defence, and hydrogen for fuel.
But there will be challenges including an ageing population, climate change, high energy costs, water scarcity, threats to biodiversity, tax inefficiencies and disruptive technology.
Mr Perrottet said the NSW 2040 Economic Blueprint wasn't government policy but set a direction for the state's future success.
"The reality is, here in our state, whilst we have an economy nationally slowing, NSW is perfectly positioned to take advantage of all the opportunity," he said on Wednesday.
The blueprint says the government can pull seven levers to enhance economic performance relating to fiscal policy, institutions, human capital, infrastructure, innovation, energy and natural resources policy.
Immediate recommendations include improving state infrastructure planning, working with the Commonwealth and states to agree on a national energy policy and committing to long-term initiatives to encourage advanced manufacturing.
In the long term, the blueprint's recommendations include education reform, improving freight networks in the regions, developing a policy on hydrogen production and export, and adopting a longer-term policy on drought.
The state's chief economist Stephen Walters said he didn't expect all recommendations would become government policy.
"I hope that many will. I'm optimistic, but I'm realistic enough to understand the challenges of the modern political economy," he said.
Shadow Treasurer Walt Secord said the blueprint was light on detail and didn't provide sufficient plans for immediate economic challenges.
Australian Associated Press
