This report forms part of the Mineral Council of Australia’s Vision 2020 Project – a project with the objective of addressing capacity constraints to growth that have afflicted the minerals industry in the past and are likely to return and erode Australia’s market share and thus visit opportunity costs on the industry and the nation into the future. The aim is avoid repeating the mistakes of past inactivity in building the social and physical infrastructure needed to meet the burgeoning global demand of the industrialising and urbanising emerging economies.
The First Phase of the Project, released in 2008, examined the global demand potential for the minerals industry through to 2020 and assessed the supplyside requirements, including the skilled labour, needed for Australia to maintain or grow its share of the global market.
This study, the Second Phase, examines existing and potential capacity constraints in ports, railways and roads; energy, telecommunications and water networks; as well as housing, labour and other social needs that affect the growth of the mining industry and the wellbeing and development of the communities in which it operates across Australia. It considers the potential for growth in 21 Australian resources regions under a scenario that broadly aligns with the Advance scenario outlined in Phase One and assesses the need for infrastructure to support that growth.1 Separate reports have been prepared for each State and the Northern Territory. While the main focus of the work is on the minerals industry, in some cases the reports for some growth regions have also considered the growth outlook for other industries.
Expansion of the nation’s infrastructure (hard and soft industrial and community infrastructure) has not always kept pace with the rapid and sustained growth in export and domestic demand. Consequently, many growth regions around Australia now have significant infrastructure constraints. This in turn has reduced Australia’s ability to meet the global demand for mineral products. Other nations have stepped in to fill that gap and as a consequence Australia’s market share has fallen.
This phase of the Vision 2020 Project lays the foundation for developing the policy and regulatory frameworks that will enable the timely provision of the industrial and community infrastructure needed to support an increase in Australia’s minerals production capacity. It is hoped that this in turn will enable Australia to rebuild its share of the global minerals market.
The Vision 2020 Project’s growth scenarios were prepared prior to the emergence of the global economic crisis. While the strong negative impacts on global growth and demand are clearly evident, most commentators believe that those impacts are likely to largely play out over next 6-18 months. ACIL Tasman believes that robust economic conditions for the minerals sector will largely return within that timeframe, and that growth is likely to return to longer term trend lines. The Asian markets in particular, with their innate demand driven by large, aspirational populations, are likely to bounce back quickly and strongly.