Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
'The climate for investment in the pulp and paper industry in Australia': address to the second AUSNEWZ Hawkins Wright conference on investment and trade opportunities in pulp and paper on the Pacific Rim



Download PDFDownload PDF

THE SECOND INTERNATIONAL AUSNEWZ HAWKINS WRIGHT CONFERENCE

ON

INVESTMENT AND TRADE OPPORTUNITIES IN PULP AND PAPER

ON THE PACIFIC RIM

17-20 MARCH 1991

KEYNOTE ADDRESS BY THE HON ALAN GRIFFITHS, MP

MINISTER FOR RESOURCES

"THE CLIMATE FOR INVESTMENT IN THE PULP AND PAPER INDUSTRY

IN AUSTRALIA"

CHECK AGAINST DELIVERY

COi'.iwtONWEALTrl PARLIAMENTARY Li DRARY M1CAH

I AM DELIGHTED TO BE ASKED TO OPEN THIS CONFERENCE WHICH BRINGS

TOGETHER REPRESENTATIVES FROM THE PULP AND PAPER INDUSTRY IN

THE REGION AND FROM OTHER MORE DISTANT PLACES.

AT THE INAUGURAL CONFERENCE IN 1 9 8 9 , A S I A - P A C I F I C ECONOMIC

Co- o p e r a t i o n was l i t t l e more t h a n an i d e a i n t h e Pr i m e

Mi n i s t e r ' s m i n d . But i t was an i d e a whose t i m e had c o m e.

The p r o c es s of As i a - Pa c i f i c Ec o n o m i c Co- o p e r a t i o n was lau nc h ed

AT A MEETING OF REGIONAL MINISTERS IN NOVEMBER 1989 - THIS WAS

FOLLOWED BY ANOTHER SUCCESSFUL GATHERING OF MINISTERS IN

Si n g a p o r e i n 1 9 9 0 .

Our o b j e c t i v e i s to s e e t h a t t h e momentum i s s u s t a i n e d and t h a t

APEC REALISES IT S POTENTIAL TO PROVIDE TANGIBLE BENEFITS

THROUGH STRENGTHENED REGIONAL CO-OPERATION AND A MORE OPEN

TRADING SYSTEM.

THE T I T L E OF MY ADDRESS TODAY I S "THE CLIMATE FOR INVESTMENT IN

t h e Pu l p and Pa p e r I n d u s t r y i n Au s t r a l i a . "

Le t me make t h e p r e l i m i n a r y o b s e r v a t i o n t h a t t h e c l i m a t e today

I S FAR BETTER THAN I T HAS BEEN FOR MANY YEARS.

The new Fo r e s t Co n s e r v a t i o n and De v e l o p m e n t Process an nounced

by t h e Pr i m e Mi n i s t e r i n h i s Ec o n o m i c St a t e m e n t l a s t week

PROMISES A NEW ERA OF CERTAINTY AND S T A B I L I T Y FOR THE FORESTS

PRODUCTS INDUSTRY.

The f i v e s t a g e p r o c e s s an n ou n c e d by t h e Go v e r n m e n t w i l l l e a d to

S IG N IF IC A N T NEW VALUE ADDING INVESTMENTS IN THE INDUSTRY, YET

AT THE SAME TIME, PROPERLY PROTECT SENSITIVE FOREST AREAS.

The Go v e r n m e n t ' s a p p r o a c h i s s e n s i b l e and b a l a n c e d , and has

BEEN WELCOMED BY STATE GOVERNMENTS, INDUSTRY AND THE ACTU. I T

I S A MAJOR REFORM BY ANY MEASURE.

- 2 -

B e f o r e g o i n g t o t h e d e t a i l s o f t h e n e w p o l i c y , l e t m e m a k e a

FEW P O I N T S A B O U T T H E A U S T R A L I A N ECONOMY AND T H E GE N E R A L C L I M A T E

FOR I N V E S T M E N T .

S i n c e t a k i n g o f f i c e i n 1 9 8 3 t h e G o v e r n m e n t ' s p o l i c i e s h a v e b e e n

D I R E C T E D TO A C H I E V I N G A MORE D Y N A M I C A ND F L E X I B L E ECONOMY I N

W H I C H I N D U S T R Y I S B E T T E R P L A C E D TO C OMP E T E ON I N T E R N A T I O N A L

M A R K E T S A ND T A K E UP NEW O P P O R T U N I T I E S .

K e y p o l i c y d e c i s i o n s h a v e i n c l u d e d d e r e g u l a t i o n o f t h e

F I N A N C I A L M A R K E T , F L O A T I N G T H E D O L L A R , S U B S T A N T I A L R E D U C T I O N S

I N G O V E R N M E N T O U T L A Y S , C O R P O R A T E A ND P E R S O N A L T A X R E F O R M , A

S T A B L E WAGES S Y S T E M , A N D S U B S T A N T I A L L Y R E D U C E D P R O T E C T I O N .

I n b r o a d t e r m s , t h e s e i n i t i a t i v e s h a v e b e e n u n d e r t a k e n w i t h t h e

C O - O P E R A T I O N A ND C O N S E N S U S OF G O V E R N M E N T , I N D U S T R Y AND T R A D E

U N I O N S .

T H I S C O N S E N S U S HA S GROWN S T R O N G E R AS T H E B R OA D E R C O M M U N I T Y

A C K N O WL E D G E S T H E N E E D T O K E E P OUR S H O U L D E R TO T H E WHE E L A ND

B U I L D ON T H E GROWTH WE H A V E A C H I E V E D T O D A T E .

T h e c u r r e n t d o w n t u r n h a s s l o w e d t h i s p r o c e s s , b u t t h e b e n e f i t s

SO F A R A R E A L R E A D Y D I S C E R N I B L E .

T h e A u s t r a l i a n e c o n o m y i s n o w m o r e f l e x i b l e a n d o u t w a r d l o o k i n g .

W e h a v e i n d u s t r i e s t h a t a r e b e t t e r p l a c e d t o t a k e f u l l

a d v a n t a g e o f n e w o p p o r t u n i t i e s w h i c h w i l l i n e v i t a b l y e m e r g e

W I T H T H E U P S WI N G I N T H E E C O N O M I C C Y C L E .

S o m e o f t h e f e a t u r e s o f t h e G o v e r n m e n t ’ s a c h i e v e m e n t s i n c l u d e :

. A D I S C I P L I N E D A P P R O A C H TO F I S C A L A ND MON E T A R Y P O L I C Y WH I C H

HA S B E E N S U C C E S S F U L I N R E D U C I N G I N F L A T I O N FROM T H E D O U B L E

D I G I T L E V E L OF T H E E A R L Y 8 0 ' S TO T H E P R E S E N T U N D E R L Y I N G

R A T E OF J U S T OV E R 5 %;

- 3 -

. B r o a d r e f o r m o f t h e t a x a t i o n s y s t e m , i n c l u d i n g l o w e r

P E R S O N A L A ND C O R P O R A T E R A T E S , M A K I N G A U S T R A L I A T H E F OURT H

L O WE S T T A X E D C OU N T R Y OF T H E OECD;

. THE INTRODUCTION OF A DIVIDEND IMPUTATION SCHEME TO

ELIMINATE DOUBLE TAXATION OF DIVIDENDS AND ADD TO

Au s t r a l i a ' s s a v i n g s b a s e ;

. A FRAMEWORK OF CO-OPERATION BETWEEN THE GOVERNMENT AND

TRADE UNIONS LEADING TO A MASSIVE DECLINE IN INDUSTRIAL

DISPUTES;

. The i n t r o d u c t i o n of i m p r o v e d work p r a c t i c e s and the

DEVELOPMENT OF A MORE SKILLED AND FLEXIBLE WORKFORCE

RESULTING IN A DROP IN REAL UNIT LABOUR COSTS;

. The r e m o v a l of u n n e c e s s a r y Governm en t i n t e r v e n t i o n and

DISTORTIONARY REGULATIONS.

. Reforms to la n d and a i r t r a n s p o r t i n f r a s t r u c t u r e i n c l u d i n g

BETTER COST RECOVERY, AND THE INTRODUCTION OF COMPETITION

IN THE TELECOMMUNICATIONS INDUSTRY.

LAST WEEK, THE PRIME MINISTER ANNOUNCED A NUMBER OF FURTHER

ECONOMIC REFORMS DESIGNED TO ADDRESS THE MEDIUM AND LONGER TERM

ECONOMIC CHALLENGES FACING AUSTRALIA.

The Pr i m e Mi n i s t e r ' s s t a t e m e n t , " B u i l d i n g a Co m p e t i t i v e

Au s t r a l i a " c o n t i n u e s the process of r e s t r u c t u r i n g the economy

TO IMPROVE THE EFFICIENCY AND PRODUCTIVITY OF AUSTRALIAN

I n d u s t r y .

Lower t a r i f f s a cr oss the b o a r d, reduced w h o l e s a l e t a x e s for

BUSINESS, DUTY EXEMPTIONS FOR MINERALS PROCESSING EQUIPMENT,

INCREASED SUPPORT FOR WORKPLACE REFORM, AND A MORE FAVOURABLE

DEPRECIATION REGIME WILL ALL MEAN LOWER INPUT COSTS AND GREATER

COMPETITIVENESS FOR INDUSTRY - PARTICULARLY FOR RESOURCE BASED

INDUSTRIES.

- 4 -

B y w a y o f i l l u s t r a t i o n , e c o n o m i c m o d e l l i n g i n d i c a t e s t h a t t h e s e

R E F OR MS W I L L D R I V E AN I N C R E A S E I N T H E V OL U ME OF M I N E R A L S AND

E N E R GY P R O D U C T I O N BY 5 % . A T 1 9 8 8 P R I C E S T H I S ME A NS AN

A D D I T I O N A L I N C O M E OF A ROUND $ 1 B I L L I O N FOR T H E P E O P L E OF

P R O V I N C I A L A N D R U R A L A U S T R A L I A .

B Y F O C U S S I N G ON C O M P E T I T I V E N E S S AS T H E C E N T R A L E L E M E N T OF

E C O N O M I C D E V E L O P M E N T I N T H E 1 9 9 0 ' S , T H E G O V E R N M E N T HAS S E I Z E D

T H E O P P O R T U N I T Y T O B R E A K T H E B A C K OF I N F L A T I O N .

O u r u n d e r l y i n g r a t e o f i n f l a t i o n i s n o w j u s t 5 . 4 % c o m p a r e d t o

AN OECD AVERAGE OF 7.2%. A CONTINUED LOWERING OF INFLATION IS

UNQUESTIONABLY THE MAJOR CONTRIBUTION THE GOVERNMENT CAN MAKE

TO THE CLIMATE FOR INVESTMENT IN THE 1 9 9 0 ' S .

Wi t h t h a t bac kg r o u n d i n m i n d , l e t me now turn to the p o t e n t i a l

FOR INVESTMENT IN PULP AND PAPER.

The i n d u s t r y , as I am sure you would be a w a r e, has

TRADITIONALLY HAD A DOMESTIC FOCUS. THIS HAS BEEN A

CONSEQUENCE OF THE REALITIES OF THE RELATIVELY SMALL SIZE OF

THE DOMESTIC MARKET, AND HIGH LEVELS OF TARIFF PROTECTION.

Ta r i f f p r o t e c t i o n i n p a r t i c u l a r has s e r v e d us poorly by

PROMOTING AN INWARD LOOKING STRATEGY DURING A PERIOD OF

GLOBALISATION OF THE INDUSTRY ELSEWHERE AND STRONG ECONOMIC

GROWTH IN THE A S IA PACIFIC REGION.

La s t y e a r , for e x a m p l e , new c a p i t a l i n v e s t m e n t i n the paper and

PULP PRODUCTS INDUSTRY WAS JUST $508M - BARELY ENOUGH TO

MAINTAIN EXISTING OPERATIONS.

MOREOVER, IMPORTS OF FOREST PRODUCTS HAVE INCREASED BY OVER

120% SINCE 1 9 8 3 / 8 4 , WITH THE RESULT THAT LAST YEAR, OUR TRADE

D E F IC IT IN FOREST PRODUCTS WAS $ 1 . 8 B , OR ALMOST 10% OF

Au s t r a l i a ' s t o t a l cu r r en t account d e f i c i t .

- 5 -

T H E R E I S OF COURS E A S T R ON G L I N K B E T WE E N OUR T R A D E D E F I C I T AND

T H E F A C T T H A T MOS T OF OUR F O R E S T P R OD U C T E X P O R T S A RE I N T HE

FORM OF LOW V A L U E WO O D C H I P S A N D A S U B S T A N T I A L P R O P O R T I O N OF OUR

I M P O R T S A R E H I G H E R V A L U E D P U L P AND P A P E R .

I N S H O R T , WE S E L L P R O D U C T FOR $ 8 0 PER T ONNE AND BUY I T B A C K FOR

UP T O $ 1 , 8 0 0 PER T O N N E .

I N T E R M S OF R E D R E S S I N G T H I S C L E A R L Y U N S A T I S F A C T O R Y S I T U A T I O N ,

t h e A u s t r a l i a n M a n u f a c t u r i n g C o u n c i l i d e n t i f i e d a n u m b e r o f

I M P E D I M E N T S TO NEW OR S O - C A L L E D " G R E E N F I E L D " I N V E S T M E N T I N T HE

P U L P A N D P A P E R I N D U S T R I E S , I N C L U D I N G :

. T H E H I G H R E A L C OS T OF I N V E S T M E N T C A P I T A L

. L A C K OF E N V I R O N M E N T A L G U I D E L I N E S AND A P P R O V A L P R O C E S S E S

. S E C U R I T Y OF AND A C C E S S T O T H E WOOD R E S O U R C E .

I CA N C O N F I D E N T L Y R E P O R T T O D A Y T H A T T H E S E I M P E D I M E N T S H A V E , I N

L A R G E M E A S U R E , B E E N R E M O V E D .

I N T E R E S T R A T E S H A V E B E E N R E D U C E D BY MORE T H A N 6 P E R C E N T A G E

P O I N T S A N D OUR U N D E R L Y I N G R A T E OF I N F L A T I O N I S NOW B E L OW OECD

UNDERLYING RATES, AND TRENDING DOWN. THE INVESTMENT CLIMATE IS

BETTER THAN I T HAS BEEN FOR SOME TIME.

Ad d i t i o n a l l y , i n l a s t w e e k' s Ec o n o m ic St a t e m e n t , the Government

ANNOUNCED A NEW FORESTS CONSERVATION AND DEVELOPMENT PROCESS

ENCOMPASSING LEGISLATIVE RESOURCE SECURITY.

THE PROCESS ANNOUNCED BY THE GOVERNMENT INVOLVES A COMMITMENT

by t h e Go vernmen t to p r o v i d e resource g u a r a n t e e s for major new

INDUSTRIAL WOOD PROCESSING PROJECTS WHICH PROVIDE SIGNIFICANT

VALUE ADDING AND INVOLVE $100M OR MORE IN NEW INVESTMENT.

- 6 -

T h e d e c i s i o n w i l l , o v e r t i m e , l e a d t o t h e p h a s e - o u t o f w o o d c h i p

E X P O R T S FROM A U S T R A L I A , A ND T H E I R R E P L A C E M E N T W I T H H I G H E R V A L U E

A D D E D T I M B E R A ND P A P E R P R O D U C T S .

A K E Y E L E M E N T OF T H E D E C I S I O N I N C L U D E S AN UP F R O N T , I N T E G R A T E D

C o m m o n w e a l t h / S t a t e a s s e s s m e n t o f t h e r e l e v a n t e n v i r o n m e n t a l ,

H E R I T A G E , C U L T U R A L , E C O N O M I C A ND S O C I A L I S S U E S I N V O L V E D I N ANY

D E V E L O P M E N T P R O P O S A L .

T h e n e w p r o c e s s a l s o p r o v i d e s s i g n i f i c a n t e n v i r o n m e n t a l

B E N E F I T S I N C L U D I N G :

- AN E X T E N S I O N OF C OD E S OF F O R E S T P R A C T I C E ;

- S A F E G U A R D S T O A C C OMMOD A T E NEW S C I E N T I F I C D I S C O V E R I E S SUCH

A S RA RE P L A N T S A ND A N I M A L S ; AND

- A J O I N T A S S E S S M E N T OF D E V E L O P M E N T P R O P O S A L S UNDE R T H E A C T

BY T H E C OMMON WE A L T H E N V I R O N M E N T AND I N D U S T R Y M I N I S T E R S .

I n e s s e n c e , t h e G o v e r n m e n t ' s d e c i s i o n r e p r e s e n t s a n e w a p p r o a c h

b y t h e C o m m o n w e a l t h a n d S t a t e G o v e r n m e n t s t o b e t t e r c o - o r d i n a t e

A N D I N T E G R A T E E X I S T I N G E N V I R O N M E N T A L , H E R I T A G E , E C O N O M I C AND

S O C I A L P O L I C I E S R E L A T I N G TO T H E F O R E S T R Y S E C T O R .

T h i s a p p r o a c h i s c o n s i s t e n t w i t h c o - o p e r a t i v e F e d e r a l i s m a n d

T H E R E C E N T S P E C I A L P R E M I E R S ’ C O N F E R E N C E D I S C U S S I O N ON RE S OURCE

S E C U R I T Y .

C o n s i d e r a b l e b e n e f i t s w i l l f l o w f r o m t h e n e w p o l i c y .

N o t o n l y w i l l t h e e n v i r o n m e n t b e p r o p e r l y p r o t e c t e d , n e w j o b s

A ND I N V E S T M E N T W I L L BE C R E A T E D I N T H E S H I F T AWAY FROM LOW V A L U E

A D D E D WO O D C H I P S T O H I G H E R V A L U E A D D E D T I M B E R AND P A P E R P R O D U C T S .

- 7 -

B y p r o v i d i n g f o r a r e s o u r c e s e c u r i t y p r o c e s s t o a d d r e s s

I N D U S T R Y , E M P L O Y M E N T AND C O N S E R V A T I O N O B J E C T I V E S , T H E R E W I L L BE

C O N F I D E N C E FOR T H E F O R E S T I N D U S T R Y TO I N V E S T I N V A L U E A D D I N G

I N V E S T M E N T A N D F O R E S T GROWERS T O I N V E S T I N NEW ME T HODS TO

I M P R O V E F O R E S T H E A L T H AND P R O D U C T I V I T Y .

WE S H O U L D NOT U N D E R E S T I M A T E T H E P O T E N T I A L OF NEW I N V E S T M E N T

W H I C H C O U L D R E S U L T FROM T H I S D E C I S I O N .

A R E C E N T S T U D Y BY A C C E S S E C O N O M I C S E S T I M A T E D P O S S I B L E

I N V E S T M E N T S I N P U L P , P A P E R A N D P A P E R P R OD U C T S TO BE I N E X C E S S

o f $ 6 b , w i t h t h e A u s t r a l i a n M a n u f a c t u r i n g C o u n c i l p u t t i n g t h e

F I G U R E A T A R OU N D $ 7 B .

A c c o r d i n g t o r e c e n t a d v i c e p r o v i d e d b y t h e A u s t r a l i a n B u r e a u o f

A g r i c u l t u r a l a n d R e s o u r c e E c o n o m i c s (ABARE) and Bureau of

I n d u s t r y Ec o n o m ic s (B IE ), the macr o- e c o n o m ic e f f e c t s of

INCREASED INVESTMENT IN THE HARDWOOD INDUSTRY ARE SUBSTANTIAL.

AN ADDITIONAL $4B OF INVESTMENT IN THE HARDWOOD PULP AND PAPER

SECTOR, FOR EXAMPLE, WOULD RESULT IN

- AN INCREASE IN GDP OF $ 1 . 5 B PER YEAR

- AN INCREASE IN REAL WAGES OF 0.6%

- AN IMPROVEMENT IN AUSTRALIA'S TRADE ACCOUNT.

I t i s t h e s e b e n e f i t s w h ic h t h e Governm en t i s c o n f i d e n t w i l l

RESULT FROM THE NEW FORESTS CONSERVATION AND DEVELOPMENT

Pr o c e s s .

St a t e Go v e r n m e n t s , i n d u s t r y an d the ACTU have warmly embraced

the Go v e r n m e n t ' s p o l i c y i n i t i a t i v e . Some r e l e v a n t quotes

INDICATE THE DEGREE OF SUPPORT FOR THE GOVERNMENT'S

ANNOUNCEMENT.

" T he Go v e r n m e n t has p r o v i d e d a c r e a t i v e s o l u t i o n and we

WILL FIND WAYS TO ENSURE ALL OUR MEMBERS BENEFIT FROM THE

NATIONAL FRAMEWORK.

- 8 -

T h e G o v e r n m e n t w a n t s p r o j e c t s t o p r o c e e d , a n d we w i l l

F U L L Y C O - O P E R A T E W I T H T H E NEWL Y E S T A B L I S H E D M A J O R P R O J E C T S

G r o u p t o g e t s o m e i n v e s t m e n t s u p a n d r u n n i n g a s q u i c k l y a s

P O S S I B L E . "

B r i a n G i b s o n . P r e s i d e n t o f t h e N a t i o n a l A s s o c i a t i o n o f

F o r e s t I n d u s t r i e s ( 1 2 . 3 . 9 1 )

" T h e P r i m e M i n i s t e r a n d F e d e r a l C a b i n e t h a v e e n s u r e d t h e

f u t u r e o f A u s t r a l i a ' s f o r e s t i n d u s t r y t o d a y b y e n d o r s i n g

T H E P R I N C I P L E OF R E S O U R C E S E C U R I T Y . "

C o l i n D o r b e r . M a n a g e r o f t h e NSW F o r e s t P r o d u c t s

A s s o c i a t i o n ( 1 1 . 3 . 9 1 )

" . . . THE COMPROMISE ON TIMBER RESOURCES . . . DOES MAKE PULP

M IL L PROJECTS POSSIBLE. THE CONSIDERABLE UNCERTAINTY

PREVIOUSLY ASSOCIATED WITH SUCH MILLS WILL BE REMOVED,

WHILE SUBSTANTIAL PROTECTION FOR NATIVE FORESTS WILL BE

R ETAIN ED ."

The Au s t r a l i a n Fi n a n c i a l Re v i e w . Ed i t o r i a l ( 8 . 3 . 9 1 )

" . . . COURAGEOUS, 'CORRECT', AND PROVIDING A BALANCE

BETWEEN ENVIRONMENTAL CONCERN AND THE NEED TO ENCOURAGE

INDUSTRY INVESTMENT."

Ma r t i n Fe r g u s o n. ACTU Pr e s i d e n t ( 8 . 3 . 9 1 )

" The c h a l l e n g e for a l l of us i s to g et Au s t r a l i a ' s

INDUSTRY COMPETITIVE.

The i n d u s t r y s t a t e m e n t r e c o g n i s e s t h i s has to be a c h i e v e d

BUT WITHOUT DOWNGRADING THE ENVIRONMENT. L E T 'S GET ON

WITH I T . "

Mr Graham Og i l v i e . Ma n a g i n g Di r e c t o r . Au s t r a l i a n Ne w s p r i n t

Mi l l s Ltd ( 1 3 . 3 . 9 1 )

- 9 -

T H E R E H A S , OF C O U R S E , B E E N SOME C R I T I C I S M OF T H E D E C I S I O N BY

E N V I R O N M E N T A L G R O U P S , AND I N OT E T H A T A L I T T L E L A T E R T ODA Y YOU

W I L L H E A R FROM MS J A N E E L I X OF T H E A U S T R A L I A N C O N S E R V A T I O N

F O U N D A T I O N .

SO T H A T T H E R E I S NO M I S U N D E R S T A N D I N G A B O U T T H E G O V E R N M E N T ' S

D E C I S I O N , L E T ME B R I E F L Y RUN T H R OU GH T H E NEW F O R E S T

C o n s e r v a t i o n a n d D e v e l o p m e n t P r o c e s s .

T h e p r o c e s s c o n s i s t s o f f i v e s e q u e n t i a l s t a g e s , e a c h d e p e n d e n t

UPON T H E S A T I S F A C T O R Y C O M P L E T I O N OF T H E P R E V I O U S S T A G E :

S t a g e 1 - F o r m u l a t i o n o f a f o r e s t c o n s e r v a t i o n a n d

D E V E L O P M E N T S T R A T E G Y BY S T A T E GOV E R N ME N T S

AND T H E F O R E S T I N D U S T R Y ;

S t a g e 2 - I n t e g r a t e d C o m m o n w e a l t h - S t a t e a s s e s s m e n t o f

E N V I R O N M E N T A L , H E R I T A G E , C U L T U R A L , E C ON OMI C

A N D S O C I A L I S S U E S ;

S t a g e 3 - C o m m o n w e a l t h - S t a t e A g r e e m e n t s w h i c h a r e t o

BE R A T I F I E D BY R E S P E C T I V E G O V E R N M E N T S ;

S t a g e 4 - C o m m o n w e a l t h l e g i s l a t i o n , e n c o m p a s s i n g

S C H E D U L E S FOR WOOD P R O D U C T I O N AND

C O N S E R V A T I O N ;

S t a g e 5 - i m p l e m e n t a t i o n o f t h e f o r e s t c o n s e r v a t i o n

A ND D E V E L O P M E N T P A C K A G E S T O P R O T E C T F O R E S T

C O N S E R V A T I O N A R E A S A ND TO E N HA N C E

E M P L O Y M E N T T H R OU GH V A L U E A D D I N G I N V E S T M E N T S .

T a k e n t o g e t h e r , r a t h e r t h a n w e a k e n i n g t h e G o v e r n m e n t ' s

E N V I R O N M E N T A L A ND H E R I T A G E L E G I S L A T I O N , T H E E L E M E N T S OF T HE

P R O C E S S L E A D I N G TO L E G I S L A T I V E S U P P O R T FOR V A L U E A D D I N G

I N V E S T M E N T S W I L L S T R E N G T H E N T H E I N T E G R A T I O N OF E N V I R O N M E N T A L

A ND E C O N O M I C C O N S I D E R A T I O N S BY E N S U R I N G T H A T A L L R E L E V A N T

I S S U E S A R E A D D R E S S E D I N A D V A N C E OF G O V E R N ME N T D E C I S I O N S ON

F O R E S T U S E .

- 10 -

T h e G o v e r n m e n t ' s d e c i s i o n w i l l n o t r e s u l t i n a n y d i m i n u t i o n o f

E N V I R O N M E N T A L S T A N D A R D S .

W h a t i t w i l l d o t h o u g h i s p r o v i d e c e r t a i n t y a n d s t a b i l i t y t o

T H E I N D U S T R Y , AND R E S U L T I N A S H I F T AWAY FROM LOW V A L U E A DDE D

WO O D C H I P S T O H I G H V A L U E A D D E D P R O D U C T S D I R E C T E D A T I M P O R T

R E P L A C E M E N T A N D TO T H E E X T E N T P O S S I B L E , FOR E X P O R T .

I n r e l a t i o n t o n e w i n d u s t r y d e v e l o p m e n t , t h e s c o p e a n d t i m i n g

OF I N V E S T M E N T P R O P O S A L S W I L L BE OF C R I T I C A L I M P O R T A N C E .

W e l l d e v e l o p e d p r o p o s a l s f o r n e w p r o j e c t s w i l l b e c a n d i d a t e s

FOR R E S O U R C E S E C U R I T Y WHEN T H E Y H A V E B E E N T H R OU GH T H E A P P R O V A L S

P R O C E S S E S .

NOW T H A T T H E C O N S E R V A T I O N I S S U E ON T H E S O U T H E A S T F O R E S T S OF

N e w S o u t h W a l e s i s r e s o l v e d , I w i l l a l s o b e p u s h i n g a h e a d t o

F I N A L I S E A R R A N G E M E N T S TO U P H O L D OUR C O M M I T M E N T T O T H E ACTU AND

t h e NSW Go v e r n m e n t to p r o t e c t e m p lo y m e n t through i n d u s t r y

RESTRUCTURING AND DEVELOPMENT.

WE WILL ALSO BE PRESSING AHEAD TO FINA LIS E AN AGREEMENT WITH

Ta s m a n i a . The f o r e s t s and f o r e s t i n d u s t r y s t r a t e g y , based on

EXTENSIVE COMMUNITY CONSULTATION, WILL BE AN IMPORTANT INPUT TO

THE AGREEMENT.

Ta s m a n i a i s m a k i n g progress towards a t l e a s t one major p u l p m i l l

DEVELOPMENT. THESE PROJECTS, SUBJECT TO MEETING APPROVAL

PROCESSES, WOULD OF COURSE BE CONTENDERS FOR LEGISLATIVELY

BASED RESOURCE SECURITY.

Su b s t a n t i a l pr ogress has been made on the e n v i r o n m e n t a l

GUIDELINES AND APPROVAL PROCESSES FOR PULP AND PAPER

INDUSTRIES, THE LACK OF WHICH HAS BEEN PREVIOUSLY ID E N TIFIE D AS

AN IMPEDIMENT TO INVESTMENT IN "GREENFIELD" PROJECTS.

- 11 -

C o m p a n i e s w i l l b e a b l e t o d e a l j o i n t l y w i t h t h e C o m m o n w e a l t h

a n d S t a t e s o n e n v i r o n m e n t a l a p p r o v a l s f o r p u l p m i l l

D E V E L O P M E N T S . A G R E E M E N T S ON COMMON E N V I R O N M E N T A L I M P A C T

A s s e s s m e n t p r o c e s s e s a n d a c c e p t a n c e o f C o m m o n w e a l t h p u l p m i l l

G U I D E L I N E S AS M I N I M U M S T A N D A R D S A RE B E I N G N E G O T I A T E D W I T H T H E

S t a t e s . T h e f i r s t , a n a g r e e m e n t w i t h T a s m a n i a , i s t o b e s i g n e d

S H O R T L Y .

T h e C o m m o n w e a l t h g u i d e l i n e s f o r b l e a c h e d k r a f t m i l l s a r e t h e

MOS T S T R I N G E N T I N T H E WO R L D , A RE A T T H E F O R E F R O N T OF T E C H N O L O GY

A N D A R E C O M M E R C I A L L Y F E A S I B L E .

B u t t e c h n o l o g y d o e s n ' t a n d c a n ' t s t a n d s t i l l .

T he G o v e r n m e n t h a s a l l o c a t e d some $ 7 . 7 6 m i l l i o n o v e r f i v e y e a r s

TO PULP AND PAPER RESEARCH, WITH A S P E C I F I C FOCUS ON THE

BLEACHED EUCALYPT KRAFT PULPMILL PROCESS. THE OUTCOME OF THIS

RESEARCH WI LL M I N I M I S E THE ENVIRONMENTAL IMPACTS OF PULPMILL

EFFLUENT ON THE RECEIVING ENVIRONMENT.

I HAVE MOSTLY SPOKEN SO FAR ABOUT A C T I V I T I E S THAT ARE OCCUPYING

OUR IMMEDIATE ATTENTION. SO LET ME CONCLUDE BY MAKING A FEW

COMMENTS ABOUT THE LONGER TERM.

W h i l e I s e e s e c u r e a c c e s s to f o r e s t r e s o u r c e s a s t h e " p a r e n t

PROCESS", I WOULD NOW L I K E TO CONCENTRATE ON OTHER

COMPLEMENTARY PROCESSES WHICH HAVE BEEN PUT I N PLACE TO

CONSIDER THE LONGER TERM APPROACHES TO THE QUESTIONS OF

COMPETING FOREST USE.

T he R e s o u r c e A s s e s s m e n t C o m m i s s i o n i n q u i r y i n t o t h e use of

A u s t r a l i a ' s f o r e s t a n d t i m b e r r e s o u r c e s i s one of t h o s e

PROCESSES.

THE RAC IS AN INDEPENDENT BODY, ESTABLISHED TO LOOK INTO THE

COMPLEX AND CONTENTIOUS QUESTIONS RELATING TO COMPETING LAND

USE. THE RAC IS CERTAINLY n a v i g a t i n g u n c h a r te r e d waters and i n

FACT THE PROCESS IS UNIQUE IN A WORLD CONTEXT.

- 12 -

G i v e n t h e w i d e t e r m s o f r e f e r e n c e a n d w i d e d i v e r s i t y o f v i e w s

T H A T H A V E B E E N P U T T O T H E RAC, I WOULD EXPECT THE RAC TO REPORT

ON THE MANY FACETS OF THE FOREST USE DEBATE.

The Go v e r n m e n t a ls o r e c o g n i s e s the c r i t i c a l i m p o r t a n c e of

MOVING TOWARDS A SUSTAINABLE BASIS FOR IT S A C T IV I T IE S .

The d e c i s i o n by the Go ver n m en t to f o r m u l a t e a s u s t a i n a b l e

DEVELOPMENT STRATEGY REFLECTS GROWING COMMUNITY RECOGNITION

THAT, IN PURSUING MATERIAL WELFARE, INSUFFICIENT VALUE HAS

SOMETIMES BEEN PLACED ON ENVIRONMENTAL FACTORS THAT ALSO

CONTRIBUTE TO OUR QUALITY OF L IF E .

Ni n e w o r k in g groups i n v o l v i n g Go v e r n m e n t , i n d u s t r y , u n io n s and

COMMUNITY GROUPS, HAVE BEEN ASKED TO CONSIDER AND BRING FORWARD

OPTIONS FOR ECOLOGICALLY SUSTAINABLE DEVELOPMENT FOR AUSTRALIA.

Such a s t r a t e g y r e c o g n i s e s t h a t e c o n o m ic growth and a w e ll

MANAGED ENVIRONMENT ARE FUNDAMENTALLY LINKED. OUR INDUSTRY

A C T IV I T IE S CAN AND DO AFFECT THE ENVIRONMENT.

I UNDERSTAND THAT THE WORKING GROUP ON SUSTAINABLE FOREST USE

I S WORKING WELL AND IS ON TRACK TO MEETING ITS REPORTING

REQUIREMENTS BY LATE 1991. AN INTERIM REPORT FROM THIS GROUP

I S EXPECTED IN JULY.

The Go v e r n m e n t does have a s t r a t e g y for a d d r e s s i n g f o r e s t use

i s s u e s . The RAC and ESD c o n s u l t a t i v e and a n a l y t i c a l process es

ARE A KEY ELEMENT OF I T . BUT SO ARE THE PROCESSES INVOLVED IN

THE RESOLUTION OF THE SOUTH EAST FORESTS AND TASMANIAN FORESTS

QUESTIONS.

- 13 -

A S A C U L M I N A T I O N OF A L L T H E S E P R O C E S S E S , P R O B A B L Y I N 1 9 9 2 , WE

W I L L BE I N A P O S I T I O N TO E N U N C I A T E A N A T I O N A L F O R E S T S P O L I C Y .

T h i s p o l i c y w i l l p r o v i d e s i g n p o s t s f o r t h e f u t u r e s h a p e o f t h e

F O R E S T - B A S E D I N D U S T R Y .

A n o t h e r i m p o r t a n t e l e m e n t t o a n a t i o n a l f o r e s t p o l i c y w i l l b e

OUR F I N A L A P P R O A C H T O P L A N T A T I O N S . T H E R E W I L L BE A R OL E FOR

C O M M E R C I A L P L A N T A T I O N D E V E L O P M E N T I N A NY L ONG T E R M P R O P O S A L S

FOR T H E F O R E S T S E C T OR A ND T H E F O R E S T P R OD U C T S I N D U S T R I E S .

T h e o b j e c t i v e i s t o e n c o u r a g e d e v e l o p m e n t o f c o m m e r c i a l l y

V I A B L E P L A N T A T I O N S ON C L E A R E D A G R I C U L T U R A L L A N D AND T HROUGH

P R I V A T E I N V E S T M E N T .

T h e G o v e r n m e n t ' s N a t i o n a l P l a n t a t i o n s A d v i s o r y C o m m i t t e e i s n o w

O P E R A T I N G A N D W I L L R E P O R T I N J U N E ON T H E T E C H N I C A L , E C O N O M I C

AND S O C I A L A S P E C T S OF P L A N T A T I O N D E V E L O P M E N T . I T W I L L A L S O

S E E K TO I D E N T I F Y A N Y R E A L OR P E R C E I V E D I M P E D I M E N T S TO

P L A N T A T I O N I N V E S T M E N T .

A d d i t i o n a l l y , we a l l r e c o g n i s e t h e i m p o r t a n c e o f r e s e a r c h t o

T H E L ONG T E R M W E L L - B E I N G OF T H E I N D U S T R Y .

T a k i n g t h e l e a d i n t h i s a r e a , t h e C o m m o n w e a l t h h a s p r o p o s e d a

GE N E R OU S S C H E ME FOR S U P P O R T OF R E S E A R C H I N T H E F O R E S T R Y S E C T OR

T HROUGH T H E E S T A B L I S H M E N T OF A F O R E S T I N D U S T R I E S R E S E A R C H AND

D E V E L O P M E N T C O R P O R A T I O N . T H E ROL E OF T H E C O R P O R A T I O N W I L L BE

TO P R O V I D E S T R A T E G I C L E A D E R S H I P I N D E V E L O P I N G N A T I O N A L F O R E S T

I N D U S T R Y R E S E A R C H A ND D E V E L O P M E N T P R OGR A MS .

I AM H O P E F U L T H E C O R P O R A T I O N W I L L BE O P E R A T I O N A L BY M I D - Y E A R

AND BE P R O D U C I N G P O S I T I V E R E S E A R C H R E S U L T S I N T H E S H O R T - T E R M .

I n c o n c l u s i o n , m a n y P a c i f i c R i m c o u n t r i e s a r e a l r e a d y

P R OS P E R OU S A N D C O M P E T I T I V E I N T E R N A T I O N A L L Y .

G r o w t h r a t e s b e t w e e n 4 a n d 8 p e r c e n t a r e c o m m o n . T h e d e m a n d

FOR P U L P A ND P A P E R P R OD U C T S C OUL D BE E X P E C T E D T O , A T L E A S T ,

GROW A T T H E S E R A T E S - MOS T L I K E L Y H I G H E R .

- 14 -

I n m y v i e w A u s t r a l i a n c o m p a n i e s a r e s i n g u l a r l y w e l l p l a c e d t o

P R O F I T FROM T H I S GROWT H. I T I S S U R E L Y NOT B E Y OND OUR S K I L L AND

T E N A C I T Y TO G R A S P T H E S E E X C I T I N G O P P O R T U N I T I E S . I N D U S T R Y AND

G o v e r n m e n t h a v e v i t a l r o l e s .

I DO NOT U N D E R E S T I M A T E T H E R O L E OF G O V E R N M E N T . T H E E C O N O M I C

P O L I C Y S E T T I N G S A R E A L L I M P O R T A N T . A N D WE ARE D O I N G OUR B I T .

B u t a l l we c a n d o i s t o p r o v i d e a n i n v e s t m e n t c l i m a t e c o n d u c i v e

TO P O S I T I V E C O M M E R C I A L D E C I S I O N S .

A S S U R E D A C C E S S T O H I G H Q U A L I T Y RAW M A T E R I A L S U N D E R P I N S A L L

I N V E S T M E N T D E C I S I O N S . T H E S E C U R E A C C E S S A R R A N G E ME N T S T H A T WE

A R E P U T T I N G I N P L A C E W I L L H E L P YOU W I T H YOUR D E C I S I O N S I N T H A T

A R E A .

I H OP E YOUR D E L I B E R A T I O N S OV E R T H E C O M I N G D A Y S W I L L P R OGR E S S US

SOME WAY T OWA RDS OUR COMMON O B J E C T I V E OF A T H R I V I N G F O R E S T

B A S E D I N D U S T R Y , A D D I N G M A X I M U M V A L U E TO OUR R E S O U R C E , I N T H E

C O N T E X T OF E C O L O G I C A L L Y S U S T A I N A B L E D E V E L O P M E N T .

T h a n k y o u .