Antinuclear

Resources ‘boom’ failing Australia’s economic competitiveness

there are the fraught issues of energy and climate change…….The lack of investment [in new renewable energy technology] will only further harm Australia’s competitiveness.

Australia slow to wake up to reality, Stuff.co.nz, By ROD ORAM –  Star Times, 15 Aug 2010, IS THE great Australian boom, the longest in any developed country, over? Yes, said Ross Garnaut, one of the country’s most respected economists, in a seminal lecture last week.

It will be, the Australian treasury warned in a budget paper in May, if the country fails to cure the distortions created by its resources bonanza.

No way, say Prime Minister Julia Gillard and opposition leader Tony Abbott. Confident the boom’s rolling on, they are campaigning on short-term fiscal rectitude and ignoring long-term economic strategy.

If the politicians have read the Garnaut and treasury papers, they either don’t accept the analysis or they lack the political leadership to do anything about it. The papers, essential reading on Australia’s economic challenges, are available at tinyurl.com/3amsb2e and tinyurl.com/37ry4sk……..

The treasury paper does not make such bold conclusions about the mining sector globally. But it shares Garnaut’s concerns about the distortions the mineral boom is causing. Mining is sucking capital and labour from other sectors and its export success strengthens the exchange rate.

These factors make the rest of the economy less competitive internationally. That’s a worry. As a small country, Australia needs to export more, but exports account for barely 20% of its GDP (compared with 30% in New Zealand) and 70% of merchandise exports are minerals. Australia needs to learn fast how to produce high-value, high-wage, non-mineral exports…..

then there are the fraught issues of energy and climate change. Both major parties are committed to reducing Australia’s emissions by 5% from 2000 levels by 2020. They offer different ways of doing so, but few analysts give either a chance of reaching the target…..Australian industries will still lack a long-term price signal on carbon so they will have little incentive to invest in new technology to clean up one of the most greenhouse gas and energy intensive economies in the world. The lack of investment will only further harm Australia’s competitiveness.

Australia slow to wake up to reality | Stuff.co.nz

August 16, 2010 - Posted by Christina Macpherson | AUSTRALIA - NATIONAL, business, energy, solar, wind | antinuclear, Australia, carbon, climate change, energy, renewable, solar, wind