The Good Oil by Rod Brown*
I have just read a compelling report on how America’s heartland can be revitalised. Many of the report’s findings have direct parallels to Australia. Those of you in regional Australia – please read it! It argues that while the central part of the USA has ample land and abundant natural resources, the region’s leaders must build on these assets. The study recommends that they must stimulate opportunities for small and medium sized food related businesses, and that expanded research be undertaken into new energy technologies, such as ethanol, biodiesel and wind power.
The study calls for enactment of a Homestead Act to provide education and housing incentives for people who move into the region. The creation of a new $10 billion American Heartland Development Bank to invest in critical infrastructure is also recommended. The report also argues for the serious development of energy crops and high value products in crops and livestock, and the empowerment of farmers to participate in such export markets.
Another theme is the fostering of local food systems, including consumer supported agriculture, specialty markets for smaller producers, organic products and so forth. These have the potential to reduce dependence on national distribution systems, and thus energy consumption, while meeting the growing consumer demand for stronger ties to producers and more information about the quality and safety of food.
The report paints an excellent picture of the scope to build a stronger relationship between food, energy and regional development policy. Mark Vaile and State counterparts, please take note.
See Rebuilding America’s Productive Economy: A Heartland Development Strategy, by Joel Kotkin and Delore Zimmerman, at www.n2tec.org/pdfs/NAF_HeartlandReport_Final.pdf
Local Government role in best practice procurement?
I had two clients complaining recently about getting their products into the government market. The products are both new, but proven in the private sector. The problem seems to be that the people letting the public works contracts, particularly roads, engineering, water, couldn’t give a toss about local companies with new technologies. I rang three federal departments – Finance (because it now looks after procurement policy), Industry and Environment Australia – to get an idea of what’s going on. The response so far has been sympathy, some rubbish about WTO procurement rules, and regret that Purchasing Australia got the knife a few years back. Well, I intend following this through. The point is that when contracts worth billions of dollars are being let on behalf of taxpayers, procurement officers should be on the lookout for local companies with products and services that can perform, save them money and give local industry a leg up. I also intend following this up with some State public works people.
In the interim, are there any local Councils out there who wish to join our lobbying effort? After all, you spend big dollars too, and the affected companies are in your backyard.
Latin speed freaks
We were in lovely Lisbon recently, and all we wanted was a leisurely taxi ride from our hotel to the cluster of waterfront restaurants. What we got was a white knuckle 90km/h escapade down streets crammed with people and cars. Absolutely crazy in a nation whose road toll is second only to China’s. Similar deal a few days before in Seville, when a speeding motorist took exception to my leisurely driving, my daughter gives him the ‘bird’. He swerves in front of our car, hits the brakes, storms out, kicks my car, belts the external mirror, screams unknown oaths. I sit there wondering whether to try my Barry Hall impersonation. I desist.
But on the other hand, every truck sticks religiously to the 100km/h heavy vehicle limit on Portugal’s freeways. This is fascinating in terms of road safety policy. It presumably means that trucks are singled out, and that if the traffic penalties are high enough, drivers will change their behaviour.
Clusters get political support in Europe
In Australia, cluster programs mostly involve hiring a person, giving him/her $20k play money and seeing if they can get some outcomes. The European Commission (EC) is a little more advanced. It has introduced a ten point program that recognises clustering concepts as an important tool for the competitiveness of the companies and regions. It says ‘clusters contribute to reduce the gap between the company, research and the resources, thus making it possible more quickly to put to the knowledge on the market …this is why the “clusters policy” became a major element of the policies of innovation of the Member States’.
EU regional programs for 2007-2013 will focus on the development of innovative regional clusters in the urban centres and in poorer/rural areas. The EC says Europe must exploit the potential of its clusters, get them to a critical mass and give them a strategic orientation including transnational European cooperation.
China syndrome spreads in Adelaide
The Structural Adjustment Fund for South Australia ($40 million) was introduced to stiffen the SA economy in the face of the Mitsubishi retrenchments. That’s been spent. Now the Australian and SA Governments have announced further investment subsidies in the wake of Electrolux’s 500 job losses – competition from China is the alleged cause. As with the earlier package, the Feds are putting the bulk of the funds, in this case $25 million out of $30 million. Round 1 of the new program opened on 15 November 2006.
But Professor John Spoehr, from the University of Adelaide’s Australian Institute of Social Research, says, “What we really need to focus on is a strategy to prevent closures and that’s going to require a rethink of national tariff protection policy in Australia…it’s time that we had a national review of our tariff protection policies.”
Our take on this?
- Professor Spoehr’s plea for a return to tariff protection is nonsense. The crying need is to develop integrated global production and trading systems, and smart companies to deliver on this.
- The Feds’ role in these incentives sets a pragmatic and interesting precedent.
- Federal Ministers from SA (Minchin, Downer, Vanstone)have influence. The Federal election looms.
* Rod Brown’s Canberra based consultancy group, Australian Project Developments Pty Ltd, specialises in industry/regional development and government liaison. For further information telephone (02) 6231 7261 or email apd@orac.net.au
