Guest essay by Eric Worrall
Greens have scored a major coup in Australia, as their PR campaign has apparently just convinced all four of the big Australian banks to close the door to lending to major new coal projects. My question – who in their right mind would invest in such a failed business environment?
A federal minister just called Westpac ‘unAustralian’ for its new climate change policy
SIMON THOMSEN APR 28, 2017, 1:34 PM
The controversial Adani coal mine in Queensland is unlikely to get funding from Australia’s big four banks after the second biggest, Westpac, tightened its funding criteria.
Westpac released its third Climate Change Action Plan today, which has a $10 billion target for lending to climate change solutions by 2020 and $25 billion by 2030.
But the detail in the document that has unleashed a political storm is the tightened criteria for funding coal mines.
Westpac CEO Brian Hartzer said: “We will limit lending to new thermal coal projects to existing coal producing basins only, and where the energy content of the coal ranks in the top 15% globally.”
The bank’s tougher criteria rule out Adani’s new $16 billion Carmichael coal mine in Queensland’s Galilee Basin to supply the Indian market.
Westpac’s decision means all four of Australia’s big banks have now turned their back on the project, with NAB ruling out support in 2015 after the CBA parted ways with the project, while ANZ CEO Shayne Elliott said his bank was “not involved and has no plans to be involved in any financing” of the mine.
Australian politicians must share some blame for this setback. This new roadblock to mining investment is just another addition to Australia’s maelstrom of green tape for new mining projects, created through years of spineless pandering to every outrageous green demand.
According to JoNova;
… The Adani central mining project application has been running for seven years and faced more than 10 court challenges. It includes a 22,000-page environmental impact statement.
In the Pilbara in Western Australia, the Roy Hill iron ore mine had to obtain 4000 separate licences, approvals and permits just for the pre-construction phase.
The Turnbull government vowed to review environmental laws to prevent activist groups’ legal challenges to development projects ranging from dams and roads to coalmines. It said challenges under section 487 of the Environment Act, which allows anyone with a “special interest in the environment” the right to challenge, were becoming more “vexatious and frivolous” . Of 32 legal challenges under the act that went to court, developers spent a cumulative 7500 days — or 20 years — in court even though 28 of the environmental cases were defeated and three required only minor technical changes to go ahead. …
This political idiocy is having a real impact on the Australian economy. Australia is facing a looming shortfall of domestic energy, a crisis engineered by defective government policies which make exploration more expensive and enhanced recovery techniques such as fracking extremely difficult to permit – a crisis which recently prompted the Australian Federal government to impose export restrictions on gas.
Government to impose export restrictions on gas companies to shore up domestic supply
By political correspondent Louise Yaxley
The Federal Government has decided to impose export restrictions on gas in a bid to ensure there are no domestic shortages.
By July 1, it intends to regulate so that it could force producers to boost supply for Australian users before they are allowed to export.
Resources Minister Matt Canavan said intervening in the market was aimed at protecting thousands of manufacturing jobs threatened by unreliable supply and high prices.
The other pillar of the Australian economy is agriculture, but Aussie farmers are also facing serious problems caused by out of touch politicians – Aussie Farmers also face a growing barrage of bureaucratic obstacles to doing business.
Farmers seeing red over red tape
31 March 2017
Tony Mahar, NFF CEO
Red tape is often the topic of political chest beating, but rarely do we see apolitical efforts to understand the detail of an industry’s regulatory woes.
That’s why the farm sector was chuffed when the Treasurer directed the Productivity Commission to undertake an inquiry into ‘regulation of the Australian agricultural sector’ in 2015.
After much anticipation, the fruits of that inquiry were released this week: 717 pages detailing (in their words) the ‘vast and complex array’ of regulations each farm business is expected to comply with.
We weren’t surprised by the finding that regulation amounts to a ‘substantial burden’ on farm businesses and the broader supply chain, but we still shake our head at some of the specifics – like dust limits which are lower than the ambient dust levels in the bush; or environmental laws which focus on single trees at the expense of entire landscapes.
There is little doubt in my mind that a combination of domestic green lunacy and an unfavourable global economic environment is having a catastrophic impact on perceptions of Australia’s international business credibility, a crisis of our own making.
When investors compare Australia’s growing snarl of green tape, the anti-business efforts of Australian politicians, with bold initiatives by leaders like President Trump to remove political obstacles to doing business, it isn’t difficult to see where the next wave of business investment and jobs growth will land.