Australia remains the world’s safest place for mining investment, an independent US analyst has declared, again undermining constant claims from the mining sector and the Coalition that the government has destroyed the industry’s competitiveness.
The period covered by the assessment includes the commencement of the MRRT and carbon pricing schemes.
The assessment, which strangely hasn’t been reported in any Australian media outlet, including specialist mining publications, stands in dire contrast to claims from the industry that the federal government had made the sector uncompetitive. In September last year, the Minerals Council of Australia released a report claiming “we have lost our competitive edge” and that there were “increasing perceptions of investment risk”. The Australian Mines and Metals Association claimed in March that the Coalition was the “last hope” for the industry and that Australia was no longer a “competitive destination for investment and job creation”. One mining executive claimed last year that “Australia is being priced out of the market for future investment opportunities”. And as late as November, the Coalition was claiming the MRRT would “deter investment“.
And then there’s high-priced experts like former BHP Billiton chairman, Don Argus, his successor Jac Nasser, the former CEO of Rio Tinto, Tom Albanese (he of the coal project in Mozambique which cost his now-former company billions), and the supporting cast from the Business Council and in the national dailies who claim Australia is pricing itself out of the market because of rapidly rising costs, that the Fair Work Act is killing productivity (while labour productivity has been steadily increasing) and that there’s too much regulation.
So, what was Behre Dolbear’s conclusion about all this? Australia’s rating fell 0.7 points, to 56.3, still well ahead of Canada, on 54.3. The Canadians have closed the gap on Australia courtesy of an improvement on “social issues”, where Australia is already top-rated, because “in Canada, the issue surrounding indigenous people is becoming much less contentious”. And despite constant complaints about “red tape” and “green tape” for mining projects from the industry, Australia is top-ranked on permit delays — way ahead of the supposedly free-market, anti-government nirvana of the United States! Australia also maintained its ranking on taxation régimes, despite the apparently apocalyptic introduction of the MRRT and carbon price. Australia is also top-ranked, along with Canada, on “economic system”, and equal second (along with the US) to Canada and Chile on “political system”.
What about the countries Tony Abbott claims are safer to invest in than Australia? “Now it is safer to invest in Argentina, in Tanzania, in Zambia, in Ghana and in Botswana than it is to invest in Australia,” Tony Abbott said in 2010. Argentina fell to 29 points, not much more than half Australia’s score, and was 15th. Tanzania fell marginally to 31.9 points. Zambia increased marginally to 26.1 points and 19th place. Ghana was steady on 36 points and 10th. And Botswana was eight, on 36.8 points, just under 20 points below Australia.
Probably best to add mining investment to retirement savings as an area one shouldn’t take advice on from Tony “shades of Cyprus” Abbott. Unless he was deliberately trying to talk down Australia’s country’s attractiveness as a destination for mining, like he and his front bench have been eager to talk down the rest of the economy.