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Abbott’s plan for North Australia: A brief overview


Aristidi Armstrong

By

October 1st, 2015


What is the economic rationale behind transforming North Australia?

This article first appeared in Short Supply 2015 – check out the full magazine via the Short Supply tab at the top of this page!


 

In June of this year the Federal government announced its White Paper on the vision for Northern Australia. It includes an ambitious plan to turn the north into an “economic powerhouse.” The vision it espouses is to transform northern cities, such as Darwin, into an investment gateway into Asia. The bulk of the plan, however, has more of a focus on increasing the productivity of the north’s farming industry and attracting workers from overseas and other states. This is easier said than done. For starters, the Northern Territory Government has to invest $12 million just to map, describe and report on the land and water resources. [1] The plan also continues to pursue Designated Area Migration Agreements to support the workforce strategies and labour markets within northern jurisdictions.

The White Paper discusses giving conventional and transferable property rights to indigenous Australians who are currently Aboriginal Land Trusts. Currently, native title land cannot be owned by an individual and is held on perpetual trust for the Aboriginal community. The long term vision is to partner indigenous communities with investors.

Whilst this aspect of the White Paper does raise some issues as to the cultural identity and ongoing traditions of the land that Indigenous Australians most likely want to preserve, from a strictly economic perspective, this measure does make a lot of sense. When Rio Tinto began to close its Bauxite mines in Nhulunbuy in Northeast Arnhem Land, the community suffered from a population drain and a slow-down in business turnover. Qantas scaled back flights to the area, which in turn affected the local population adversely by isolating it.

In terms of attracting FDI and domestic investment, the Government also wants to establish a ‘single point of entry’ office in Darwin to help investors deal with regulatory requirements. This will offer support to investments starting at a lazy $50 million. [2] A new $75 million Cooperative Research Centre on developing the north will also be set up, and there are measures to boost links with the broader Asia-Pacific region. [3]

Overall, the plan is ambitious. Nevertheless, it sets out a comprehensive roadmap that can ultimately be achieved if followed. The plan is likely to suffer from government changes and political tampering, and there is a danger that this could go the way of the Whitlam government’s grand plan to decentralise the density of the Australian populace and to build up regional centres such as Albury-Wodonga. That plan was abandoned after Whitlam was sacked and we are now paying the price. The major cities are overcrowded with unprecedented costs of living and property prices. If this plan falls though it is likely we may just rue a missed opportunity to properly develop our north and extract the most value out of it in decades to come.

 

Ari is a fifth year Commerce and Law student. He is specifically interested in the interaction between world leaders and the economy, especially in these challenging times.

 

[1] Glenday, J. (2015). ‘Northern Australia White Paper: Government Unveils Development Blueprint for Economic Powerhouse.’ ABC News.

[2] Ibid.

[3] Ibid.

The views expressed within this article are those of the author and do not represent the views of the ESSA Committee or the Society's sponsors. Use of any content from this article should clearly attribute the work to the author and not to ESSA or its sponsors.

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