Nationals senator Matt Canavan is not one of the Coalition’s shrinking violets. The former Resources Minister has been quite prepared to take the stick to rent-seeking energy companies and mining billionaires giving free propaganda leg-ups to Chinese communist bullies.
Canavan has more recently pushed the federal government to tear up its energy agreement and re-invest in reliable, cheap coal generation.
Now, Canavan is joining the growing chorus of voices calling on Australia to decouple itself from China – and start standing up to Beijing’s economic bullying.
Australia is the world’s largest exporter of iron ore and coking coal — the two key ingredients that go into making steel. Yet we are now a net importer of steel, something that should be more widely acknowledged as a cause for national shame.
Modern times are known as the information age but it is steel that has unlocked the greatest economic advancement in history.
This is the economic lever that Canavan argues Australia needs to tilt against China. China’s rapid economic rise is utterly dependent on steel production. Yet, while China might be the world’s dominant steel producer, almost all of that production is dependent on government handouts – and Australian iron ore and coal.
China gets about 60 per cent of its iron ore needs from Australia.
Iron ore is the one product that China has not slapped tariffs or restrictions on in its increasing trade war with Australia because it cannot easily replace our supply. China’s trade action has already caused massive economic harm to our beef, barley, seafood and wine industries. To avoid further harm we need to make the Chinese Communist Party pay a price because that will be the only thing that will stop further trade restrictions.
We should apply a levy on exports of iron ore to China. The funds raised can be used to compensate the Australian industries harmed by China’s actions. Our exports of iron ore to China amount to $85bn a year. So even just a 1 per cent levy would raise more than $800m a year, more than enough to assist those industries harmed by China’s unjustified trade actions.
We could then signal that every time China takes further action against Australian exporters, the levy would go up. We could signal that the levy would be removed if China ended its unjustified trade restrictions.
You don’t have to think hard to imagine the unholy squealing such action would raise from parts of the West. But how long should the rest of Australia suffer, just to keep a handful of mining billionaires in the lifestyle to which they’ve become accustomed?
For how long can it be morally justified to take the cash of a brutal, genocidal dictatorship and let ourselves be bullied into acquiescence?
Such action has precedent. The EU began its life as the European Coal and Steel Community, which managed steel production levels across countries so as to reduce tensions.
Brutally honestly, the Coal and Steel Community was designed to stop Germany getting uncontrolled access to war-making material. The Allies realised, belatedly, that had they acted decisively to stop Nazi Germany re-occupying the Rhineland, Hitler’s regime would have folded like a cheap suit.
It’s long past time to call China’s bluff.
Such an agreement could also see Australia return to growing our own steel production. We were once a significant producer of steel, making much more than just clotheslines. Everyone is in love with the idea of growing Australian manufacturing. We should start by adding value to our high-quality natural resources such as iron ore and coal and creating thousands of Australian jobs.
If we help other countries increase their steel production that would help the world reduce its dependence on a bullying and aggressive Chinese Communist Party.
The Australian
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