QRC dismiss local content manufacturing calls

The Queensland Resources Council has dismissed calls for government intervention and mandated local manufacturing content levels.

It claimed the Federal Government moves were ‘populist and projection’.

Acting chief executive Greg Lane said now is the time for the Queensland mining industry to act as the industrialisation of China and India is proceeding with or without Queensland’s participation,” Lane said.

“No-one is going to wait for Queensland or Australia to catch up with the most significant period of economic growth in world history.

“What should be obvious from current affairs is that lazy government policies in both the United States and Europe have contributed to an unfolding economic crisis,” Lane stated

“Putting the brakes on resource projects through mandated content quotas would consign Queensland’s economy to a similar fate,” he said.

The Government has pushed for local content laws to force miners to use Australian firms and good at their sites.

The Federal Government appointed former Queensland premier Peter Beattie as the nation’s first ‘Resources Sector Supplier’ envoy, to encourage Australian mining companies to buy local, which is part of a wider Buy Australia program.

Greens MP Adam Bandt said “we know that the big miners are sending much of their profits overseas, but now we know that a lot of the goods and services needed to develop these mines are coming from offshore as well.”

Bandt called for the enforcement of local content levels.

He pointed to a report released last month stating as little of 10% of the steel for major resource projects are sourced in Australia, further claiming that restrictive Chinese resource contracts are to blame.

A lack of local content has also been blamed for rising West Australian unemployment.

According to the Australian Bureau of Statistics unemployment rose from 4.0 to 4.4 per cent in August, with 5000 more people without work.

On top of this, the West Australian manufacturing industry is losing around 150 jobs a day as people leave for the mining industry.

The WA opposition also put forth proposal to set a minimum level of local content in mining projects, the Skilled Local Jobs Bill, which was later defeated in parliament.

However, West Australian premier Colin Barnett and Rio Tinto Australia iron ore chief Sam Walsh are in agreement with Lane, saying there are flaws in local content laws.

Barnett said there are “grave risks” in pursuing a legislative approach, as it runs the risk of taking more work offshore.

“The government has got a very clear interest in making sure work does stay in Western Australia and there are skills and job opportunities available for the Western Australian public, but it is very dangerous territory when governments get involved in direct private sector financial arrangements.
“I don’t favour legislation at all. 
“I think that would be a very poor way of proceeding and would probably make the companies recede even further from giving work locally.”

Walsh added that the mining industry already supports Australian manufacturing, and that “manufacturing is going through an evolution [and] it needs to go through an evolution so we can concentrate on areas where we’re competitive”.

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