THE mining boom is far from over, and Australia’s miners must calm down when it comes to austerity drives, says outgoing Minerals Council of Australia (MCA) chief executive Mitch Hooke. He quantified his statement to members of Melbourne Mining Club by saying that the development of emerging economies such as China had a long way to run and describing the unprecedented demand for Australia’s raw materials as a new normal.
“The global economic re-weighting, driven by urbanization and industrialization, will continue for at least the next decade,” he said. “I suggest there is real downside risk if this unrelenting focus becomes more akin to foetal position-like behaviour, as markets and industry tend to over react.”
The mining lobbyist said that too often in its history the mining industry had been reactive rather than proactive and should be pre-empting and shaping cycles rather than following them. He also took a swipe at Australia’s former Labor federal government, accusing it of the politics of class envy and warfare and redistributing wealth rather than growing it through productivity.
Australia’s Association of Mining and Exploration Companies (AMEC) says the policy changes proposed by the incoming Coalition government are helping restore mining industry confidence, but Australia has a way to go.
AMEC president Will Robinson said during the launch of Grant Thornton’s fourth annual survey of junior mining and exploration (JUMEX) companies: “The discovery of new resources has not kept pace with depletion and Australia is losing market share in the production of most commodities. Australia’s share of global exploration has reduced from 21% in 2002 and now stands at 12%.
“To reverse this trend, AMEC has been advocating for policy changes that will make Australia a more desirable place to invest such as the removal of the Carbon Tax and the Minerals Resource Rent Tax (MRRT). The Canadians have proven that with the right policy settings, developed nations can attract new exploration capital and increase their share of exploration investment.
“The proposed Exploration Development Incentive (EDI) is a timely and much needed catalyst for the industry. AMEC has been instrumental in the Federal Coalition adopting the EDI and continues to assist the Government on implementation of this initiative. The Coalition’s ‘one-stop shop’ for environmental approvals will also address the burdensome and duplicative approval processes highlighted in the JUMEX survey.
“As the survey shows, more still needs to be done to increase Australia’s reputation as a safe and desirable place to invest in mining and exploration,” he added.
“The key findings are consistent with the feedback that AMEC regularly receives from member companies. The challenges highlighted were equity funding, deterioration of market conditions, approvals processes and government regulation,” said AMEC CEO Simon Bennison.