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Goodbye Gunns « Previous | |Next »
September 26, 2012

Gunns has been entered into voluntary administration after posting a $904 million loss. The banks finally pulled the plug on Gunns.

Poetic justice for the history of Gunns corrupting the polity, cowing the media, poisoning public life and seeking to persecute those who disagreed with Gunn's proposal for a world-scale Bell Bay pulp mill in the Tamar Valley. They decided to fight the environmental assessment of the proposed pulp mill rather than negotiate with green groups and the local community.

Gunns, the logging of old growth native forests, woodchipping, and a pulp mill were, until very recently, seen to be the core driver of Tasmania's development. As Richard Flanagan accurately observes in the Tasmania Times:

The demise of Gunns brings to an end a tumultous three decades of Tasmanian history that began with Robin Gray losing the Franklin Dam battle to the Bob Brown led environmental movement in 1983, continued with Robin Gray losing both the Wesley Vale pulp mill battle and government to a Labor-Green government in 1989, and now the loss of Gunns and Gray’s third white elephant, the Gunns pulp mill.

Gunns wasn't able to make the transition to a plantation-based timber company. The company had a debt load and a declining asset base, and it faced a high Australian dollar and falling woodchip prices. Secondly, the plantation woodchip industry in Tasmania couldn't compete with the low cost chips exported from Vietnam and other places.

After the demise of the one big project maybe the Tasmanian state government can move onto considering a different kind of future--a clean, green, and clever state---as opposed to the old model of economic growth based on the exploitation of natural resources.

The AFR's editorial --Tasmania needs to pay its own way--- opposes this kind of development. It defends the old style development with foreign capital:

Tasmania faces a range of problems due to both external circumstances and its own making. Rather than expending so much effort in preserving their forests by blocking all development, Tasmanians should be working out how to pay their own way.....there is no reason for wealthier states to subsidise Tasmania if the state remains intent on preservation at the expense of economic development. Rather than government subsidies from the rest of Australia that it uses as working capital, Tasmania needs investment capital, including foreign investment, to develop its natural resources.

Tasmania cannot continue to rely on the substantial subsidies at the expense of resource rich states (WA and Queensland), so it has to get its house in order. So what does developing its natural resources mean after the global financial crisis? Ever more mining in the Tarkine with Chinese investment?

A Tasmania of small and medium businesses in the epicure food and beverage sector, tourism, informational technology and a science hub premised on Hobart being the gateway to Antarctica is not a future for the AFR. Yet it is the most realistic one.

The Giddings Labor Government's ongoing defence of the Bell Bay pulp mill as an economic driver is a good example of Lindsay Tanner's argument in Politics in Purpose that Labor was stuck in the 1970s when politics was over the battle for material resources within a nation state. It illustrates how Labor has become an electoral machine largely devoid of purpose other than defending entrenched commercial interests.

| Posted by Gary Sauer-Thompson at 9:59 AM | | Comments (11)
Comments

Comments

"After the demise of the one big project maybe the Tasmanian state government can move onto considering a different kind of future--a clean, green, and clever state"

Premier Lara Giddings and her deputy, Bryan Green, are saying that the demise of timber company Gunns may increase the prospect of its stalled $2.3 billion pulp mill in the Tamar Valley coming to fruition.

Apparently investors--according to Giddings---are circling to buy the mill project's assets, even though the mill lacked a "social licence".

Labor should move on.

A Tasmania of small and medium businesses in the epicure food and beverage sector, tourism, informational technology and a science hub premised on Hobart being the gateway to Antarctica is not a future for the AFR."

it is the future according to the Tasmanian Greens

"Tasmania needs investment capital, including foreign investment, to develop its natural resources."

That AFR view means economic growth that causes environmental harm.

The AFR doesn't see the importance of broadband infrastructure for the digital development of Tasmania's society and economy.

Presumably they would be opposed to this infrastructure being made available at utilities rates, similar to electricity, gas, water and roads.

"The AFR doesn't see the importance of broadband infrastructure for the digital development of Tasmania's society and economy."

Neither does the Giddings' Labor Government. They rarely talk about the political, economic and social opportunities that are dependent on, and emerge from, an affordable and high quality digital infrastructure in Tasmania.

The fixed and mobile broadband networks are increasingly being used by a whole range of different sectors – media companies, healthcare organisations, educational institutions, energy companies (smart grids) and others. The idea of value-added network services also includes cloud computing, specialised applications and data centre services.

This is what the Giddings' Labor Government should be talking about --not the Bell Bay pulp mill and the Tasmanian woodchipping industry! They are still talking in terms of the one big project that will save Tasmania.

The Giddings' Labor Government is looking back to the past rather than Tasmania's transitioning into the new digital environment.

By the end of 2015, nearly all households and businesses in Tasmania will be able to connect to the NBN. The entry price level to the NBN is equal to that of current broadband products but the NBN offers a significant increase in quality.

Unlike woodchipping the digital economy is a growth area---where high-speed broadband has already been rolled out the reports are that new applications, new opportunities and new uses are being developed.

When I first visited Tasmania 20 years ago I was struck by the thought that it was a state with a history but no future.

Returning to the apple isle 3 years ago I was agog at the 3 long lines of wood pile outside every house back door, the piles were wood to burn now, wood that is aging, wood that has just been cut. I believe the state is providing subsidies to switch from wood heating to inverters.

Gunns has demonstrated its inability to operate in a socially acceptable way and demonstrated its fixation with exploiting the resources and annhilating all human, animal or flora opposition.

John Gaye's reputation for lack of integrity, ruthlessness combined with his low education level almost guaranteed the demise of Gunns. Gunns operations damaged the economic prospects of countless young Tasmanians.

Meant to mention that I heard in August 2011 that South America could export eucalpyt wood chips cheaper than Tasmania

Gunns was a dinosaur in that it refused to make the shift to sustainability. It was business as usual and to hell with the environment. Bad corporate governance.

The coal fired power stations are doing the same--they are fighting both the carbon price and renewable energy incentives. It is not a sustainable long-term strategy.

"When I first visited Tasmania 20 years ago I was struck by the thought that it was a state with a history but no future."

it does have a future----The Greens say that this is one of small and medium businesses in the epicure food and beverage sector, tourism, informational technology and a science hub premised on Hobart being the gateway to Antarctica.