Christian Porter, former WA Treasurer and Attorney General, has come out in favor of a Special Economic Zone in North Australia.
Earlier this week, the federal Liberal candidate for Pearce highlighted that tax rebates had been successfully used in 1945 to grow the North West Western Australian resources sector.
Mr Porter’s speech was a strong endorsement of the comments made by ANDEV Chairman Mrs Gina Rinehart last week. Mrs Rinehart renewed calls for a Northern Special Economic Zone, arguing that if the regulatory and cost environment was not improved in Australia, many resources projects will move offshore.
Mrs Rinehart warned that resource-rich West African competitors offer a much better return on investment for mining companies. Australia, she said, had become a “high-cost and high-risk nation for investment”.
It was also refreshing to see Resources Minister Martin Ferguson agree that high costs are a major issue facing the resources sector. However, this acknowledgment is cold comfort for many West Australian companies that, as Mr Porter said, had been forced to deal with “outrageous developments in industrial relations” under the Gillard Government.
This was a key point raised by Mr Porter who was worried that high labour costs and rising industrial disputes were unsustainable given plummeting commodity prices.
As an example, Mr Porter pointed to an offshore dredging company that “recently agreed to a 40 per cent pay increase for workers, which will see some crew paid at an annual rate of $356,000 for what are essentially odd jobs.”
This is in sharp contrast to the countries Australia is in competition with. Mrs Rinehart noted that workers in the US were able to work for around $US 10 an hour.
The Australian government cannot continue to ignore the problems that face the resources sector. With commodity prices continuing to plunge, more needs to be done to keep Australian mines profitable and keep Australian workers in jobs.
A Special Economic Zone in North Australia would be a magnet for foreign investment, and in fact, Australia is rare among Asia-Pacific economies in not having an SEZ.
Mr Porter will be a welcome addition to the Federal Parliament and to the federal political landscape.