Wayne Swan Points to $268.4B Investment as Proof of Bright Prospects for Resources Sector
By Vittorio Hernandez | November 29, 2012 9:58 AM EST
Treasurer Wayne Swan reiterated on Wednesday that Australia's mining boom is not yet over despite falling prices of commodities in the world market and lower demand. He cited the $268.4 billion investment to major resources projects that mining companies had committed in the last six months to October.
He pointed to a report by the Bureau of Resources and Energy Economics that the record amount of pipeline investments is broken down into 87 projects made up of 51 mining ventures, 18 gas and petroleum projects and 18 infrastructure projects.
The bulk of the investments are in mega projects such as liquefied natural gas plants since the decline in global commodity prices had caused mining companies to defer or ditch smaller developments considered higher risks.
CommSec chief economist Craig James said the 87 committed resource projects are higher than the average number of projects logged in the past eight years, belying speculations that the China boom is over.
The new investments add to a total $650 billion of potential investments in the country's resource sector, Mr Swan said.
"These robust figures are a resounding vote of confidence in the resilience of Australia's economy," he said.
His prognosis dovetails with an Organisation for Economic Co-operation and Development economic outlook released in France that said Australia would expected to attract more mining investments in 2013.
Resource Minister Martin Ferguson conceded that while the amount of total investment appears to be staggering - roughly equivalent to the amount the U.S. spent in the 1960s and 1970s for the Apollo Moon Programme - costs are rising and Australia is definitely approaching a challenging phase.
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