Although operators of the soon-to-be shuttered smelter plant in Hunter Valley cited the high Australian dollar and weak prices in the international market for aluminium as the short-term reasons why it would close its Kurri Kurri facility, the Opposition seized the closure of the plant to blame again the carbon tax for the economic woes of companies in Australia.
Norsk Hydro sees demand growth slowing in 2012
The Coalition saw an opening to hit the carbon tax, slated to be collected at an initial price of $23 per tonne by July 1, when Hilde Merete Aasheim, the executive vice president of Norsk Hydro, which operates the smelter, also cited the carbon tax and higher energy costs as among the threats to its long-term viability.
"The carbon tax is killing jobs, it's already doing it," Opposition climate action spokesman Greg Hunt was quoted by Business Spectator.
He insisted that local firms could ride through short-term factors such as low commodity prices, but would find it hard to address long-term costs such as the carbon tax.
However, Climate Change Minister Greg Combet said that Norsk informed him the reason behind the closure, which could lead to the loss of about 350 jobs, is due to the company's financial losses and not to the carbon price which has yet to be collected.
He pointed out that aluminium prices have plummeted 40 per cent from a peak of $3,300 a tonne to only $2,000. Mr Combet added the government is assisting alumunium smelter operators by charging only $1.30 per tonne of emissions on core smelting activity.
But Opposition leader Tony Abbott continued to place the blame on the carbon tax. He said Australia should be a global leader in manufacturing because of the abundance of cheap energy sources in the country such as coal and gas.
"The trouble is we are deliberately making our energy more expensive, that's the whole point of a carbon tax," Business Spectator quoted Mr Abbott.
It is not just Norsk Hydro that is suffering from weak global prices. Alcoa is studying the viability of its Point Henry aluminium smelter in Victoria and Rio Tinto is also conducting a review of its Bell Bay operations in Tasmania.
In January, Norsk declared 150 positions redundant. The Kurri Kurri plant has 344 employees.
It is not just Norsk workers who are at the risk of becoming jobless. Even Australian employees of U.S. tech firm Hewlett-Packard (HP) may be laid off as the world's largest computer firm announced on Thursday that it would reduce its global workforce by 27,000 positions.
The axing of jobs was announced by HP after the firm logged a 31 per cent slump in profits for its second fiscal quarter to $1.6 billion, while revenue dropped 3 per cent to $30.7 billion compared to 12 months ago.
HP South Pacific has not provided details of the job cuts, but a spokeswoman of the company said the lay offs would hit every country and part of its business.
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