The Minerals Council of Australia (MCA) has released a report warning that Australia is at risk of losing its advantageous position in the global resources economy, as other major players move to take advantage of the clean energy transition.
MCA CEO, Tania Constable, said that deepening investment uncertainty, exhaustive delays in environmental approvals and the proposed introduction of rigid and costly industrial relations laws are combining to blunt Australia’s ability to fully capitalise on this once in multiple generation mining boom.
“As Australia’s global competitors ramp up their investment and development, time is running out to catch the wave of mining investment needed to achieve the collective global pursuit of net zero emissions,” Ms Constable said.
On 4 September, the MCA released its Future Critical report: Meeting the minerals investment challenge, which highlighted the crucial role minerals and resources play in Australia’s economy and communities, their inherent connection to Australia’s long-run prosperity and the funding of government services, and the risks of missing what the MCA called a golden opportunity to secure the nation’s prosperity for decades to come.
Ms Constable said that the report highlighted the compounding investment risks associated with the construction and development of a new mine site, and the cost to the economy of any delays.
“It puts the cost to the economy from a 12-month delay in environmental approvals at $51 billion cumulative GDP loss, based on the 16 years it takes to bring a new mine from discovery to production.
“Capital investment has traditionally been central in Australia’s productivity growth, including the flow of foreign capital, but remains under siege due to increased competition from global competitors.
“Of great concern, the report shows that the mining industry’s net capital stock is plateauing at a time when it should be accelerating to take advantage of the boom in critical mineral production, a further dent to the nation’s lagging productivity.”
The report said that if a major expansion of mining were to occur, similar to the previous mining boom earlier this century, households would be $11,700 better off, real wages would be 9.4 per cent higher and the economy $290 billion larger by 2030.
From 2012-13 to 2021-22, mining companies have paid $252 billion in wages to hard-working Australians, on top of $295 billion in taxes and royalties that fund hospitals, schools, aged care, childcare and infrastructure.
Ms Constable said that the sector is a prolific job creator and wage booster, with the minerals industry supporting over 1.1 million jobs and paying the highest average wages at $151,500.
“The report showed that for every one new job created in mining, 6.14 new jobs are created across all industries.
“While Australia has the attributes, the workforce, the expertise, and the array of deposits required to be a leading global supplier of the critical minerals, governments have a critical role to play.
“The push to unlock this opportunity must be supported with enabling government policy that improves Australia’s competitiveness in attracting investment, clears regulatory impediments, and boosts productivity.”
The report put forward 14 recommendations in five key themes:
- Reduce the regulatory burden to attract investment
- Advance policies that support competitive project returns
- Deliver efficient public infrastructure and services
- Make support for mining a political imperative
- Put business and productivity at the centre of fiscal policy
“Maintaining Australia’s competitive edge in mining will require immediate and coordinated action by the government, to ensure a prosperous future for all Australians.
“The opportunity is there for the taking.”
