A report predicting increased congestion - both in Sydney and the Illawarra - could be good news for the region, according to the Illawarra Business Chamber.
Infrastructure Australia, an advisory body to state and federal governments, released its 2019 infrastructure audit and accompanying report on transport congestion.
The body found Sydney's roads are increasingly congested and trains are outstripping capacity, despite significant investment.
Illawarra Business Chamber Executive Director Adam Zarth said it signals the need to build up regional areas to better spread out the population.
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"By investing in regional economies like the Illawarra where the return on investment is higher, we alleviate the pressure on Sydney's road and rail infrastructure and allow the 23,000 people who commute there each day to work closer to home," Mr Zarth said.
With the report also finding key roads in the Illawarra like Memorial Drive and the M1 Princes Motorway will be at capacity in peak hour by 2031, Mr Zarth said investment was needed in the region as well.
But the infrastructure funds spent in the Illawarra would go further than if they were spent in Sydney.
"The required infrastructure to grow the Illawarra economy and connect it to the economic growth region of south-western Sydney is relatively cost-effective but would have a major impact on the state economy," he said.
The projects that would boost the Illawarra included an upgraded version of the Maldon-Dombarton line to take passengers as well as freight (dubbed the South West Illawarra Rail Link by the business chamber) and turning Picton Road into a motorway.
"Picton Road will reach peak daily capacity in three years' time and yet only minor safety improvements are slated for five to 10 years' time," the chamber's executive director said.
"Freight will be displaced by passenger services on the South Coast line from 2030, which is why South West Illawarra Rail Link also needs urgent consideration."