The Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) recently published its April report on – “Minerals and energy: major development projects – April 2011 Listing”. It is quite staggering the amount of investment being put into this sector of the Australian economy. At the end of April 2011, there were 94 projects at an advanced stage of development, with a record capital expenditure of $173.5 billion. Below is the breakdown by state and notice the dominance of Western Australia.
In 2010–11, exploration expenditure in Australia’s minerals and energy sector is estimated to be $5.9 billion, broadly similar to expenditure in 2009–10. Investment in mineral exploration remains strong, with Australia expected to record its third highest annual mineral exploration expenditure in 2010–11. Click on the image below to see the ‘Advanced Minerals and Energy Projects’ currently in operation – no wonder they can’t find any workers in the cities.
The Economist last week had an article entitled “Australia the next Golden State” in which they suggested that the country with its booming economy could become the new California.
It already has a successful economy, which unlike California’s has avoided recession since 1991, and a political system that generally serves it well. It is benefiting from a resources bonanza that brings it quantities of money for doing no more than scraping up minerals and shipping them to Asia. It is the most pleasant rich country to live in, reports a survey this week by the OECD. And, since Asia’s appetite for iron ore, coal, natural gas and mutton shows no signs of abating, the bonanza seems set to continue for a while, even if it is downgraded to some lesser form of boom.
And they conclude by saying:
Though the country’s best-known building is an opera house, for example, the arts have yet to receive as much official patronage as they deserve. However, the most useful policy to pursue would be education, especially tertiary education. Australia’s universities, like its wine, are decent and dependable, but seldom excellent. Yet educated workers are essential for an economy competitive in services as well as minerals. First, however, Aussies need a bit more self-belief. After that perhaps will come the zest and confidence of an Antipodean California.