In the wake of the global steel crisis the Australian Manufacturing Workers’ Union (AMWU) is calling on the New South Wales government to mandate the use of Australian steel in its major infrastructure projects. This follows the introduction of similar laws in Victoria and South Australia, as well as the announcement of the Federal Opposition’s plan for the steel industry.
The global oversupply of steel, driven by the Chinese government’s failure to address overcapacity, is putting pressure on manufacturers across the globe: in the UK the Conservative government is considering partly nationalizing the Port Talbot steelworks, the US has recently placed a 266% tariff on Chinese steel imports.
The call for local procurement comes as the steel manufacturer Arrium continues talks with creditors about how to service its debts. While several state governments have pledged their assistance to the Australian steel industry, the New South Wales government has drawn criticism from other states over its use of imported steel in major infrastructure projects such as the North West rail link and the Sydney Convention Centre.
A BIS Shrapnel report released late last year found that a local procurement policy would add only 0.2% to the state’s infrastructure costs and would keep both of Australia’s steelmakers in production. It was estimated that the policy would deliver a significant return on investment, adding $1.3 billion to real GDP in the next five years, while saving thousands of steelmaking jobs.
“Governments across the world are intervening to stop a steel industry collapse,” said AMWU NSW Secretary Tim Ayres. “We know that local procurement works and that is a cost-effective way to support Australian steel industry through this current crisis. It will save Australian jobs.”
“If the steel industry goes those jobs will never come back. The effect of a steel industry collapse for workers, their families and their communities would be devastating,” he said. “We need Australian governments to buy Australian steel and that means that the NSW government needs to play its part.”
“If the NSW Government continues to use imported steel for major infrastructure projects they are is putting ideology before common sense,” he said. “Imported steel costs Australian jobs.”
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