Updated: 07/29/2014 10:34 | By Agence France-Presse

Australia 'needs to lower costs' to attract investment: Rinehart

Mining magnate Gina Rinehart said Tuesday that high costs were hurting resources investment in Australia, as a study found that only the country's agriculture sector was strongly competitive compared with the United States.


Australia 'needs to lower costs' to attract investment: Rinehart

File photo of mining magnate Gina Rinehart - by Tony Ashby

Rinehart, Australia's richest person, said the resources-rich nation needed to "lower its costs and compete for investment" if it wanted to stop miners from moving to other countries.

"One of the things Australia has to learn and appreciate is that for us (miners) to export, people aren't going to buy products because they like Australians -- forget it," Rinehart told The Australian newspaper.

"They're only going to buy the products if we remain commercially competitive, cost-competitive.

"And this is a really big challenge for Australia because we've got very high costs and we've really got to work hard on that if we want to sustain our future, and a good future."

Rinehart, whose company Hancock Prospecting owns 70 percent of the massive Roy Hill iron ore mine in Western Australia, added that "too many multinational companies, even Australian companies, are focusing and preferring to invest in overseas countries with lower costs".

The mogul's comments came just months after three of the world's biggest miners -- BHP Billiton, Rio Tinto and Rusal -- warned that government taxes, high costs and a strong currency were putting pressure on their Australian operations.

Australia's exports are heavily dependent on mining with the country's 1.1 percent growth in the first-quarter of this year powered by a surge in mining exports.

Rinehart's remarks came as research was released by the Business Council of Australia, conducted by management consultants McKinsey & Company, which found most of the country's industry sectors "are not competitive against the United States".

"McKinsey found that Australia was strongly competitive in only one sector -– agriculture," Business Council of Australia President Catherine Livingstone said.

She added that Australia also had a "substantial comparative advantage in other sectors with flat or diminishing competitiveness" including mining, tourism and food manufacturing.

Despite this, "Australia suffers from pervasively low competitiveness", McKinsey said in its report.

"If Australia does not adapt, it risks a painful correction: the competitiveness problem becomes a handbrake on growth, and job-level competition leads to rising unemployment and lower wages," the study said.

Latest Photo Galleries on xinmsn

NEWS VIDEOS

MORE NEWS VIDEOS

facebook recommendations

LIVE NEWS RADIO STREAMING

  • 938 Live

    938LIVE is Singapore's only English news and talk station which transmits round the clock with an engaging and enticing spread of programmes on current affairs, health, business and lifestyle as well as news every half hour until midnight.

  • Capital 958


    95.8FM城市频道的前身是"第三广播网"。上个世纪30年代末,新加坡就有中文广播,一路走来经过不少政治,社会局势的改变,中文广播在本地一直扮演举足轻重的角色。