Fixing the roof before the storm sets in: solutions for an ailing economy

Last weeks’ developments [1]announced something we all hoped would never happen, yet we are forced to ask: has the global financial crisis eventually hit the Australian economy? Or is what is happening rather the result of faulty environmental policies and practices?

If it is part of the crisis or not is hard to say, at least there are some signs of it. First and most obvious seems the fact that being the last in one for Australia very important global trade chains[2], it comes as no surprise that the Australian economy is being hit last. Another reason is that due to lack of information, until recently the Australian economy appeared to be healthier than it really was and together with missing trust in weak economies elsewhere, many investors found the Australian dollar as their safety heaven. Nevertheless, it may have been obvious to many and was even announced that the mining boom and an unsustainable development wouldn’t go on forever.

The point is that Australia’s image has been overestimated for a long time: the economy in Australia was good mainly due to unsustainable use of finite resources and nobody seemed to care. The mining boom in the past decade has created a comfortable situation that made many overlook the real challenges. Compared to a house in need of renovation it is as if we would have spent our time painting walls and fixing small cracks, despite the fact that the roof was leaking all the time.
Now the tide is turning: the storm is about to setting in. Unsustainable practices are no longer well received – neither by the international community nor by Australians. Investors will seek opportunities in “greener” investments. Sustainable development is not only a logic concept but also leads the path to where future developments must be heading. However, exactly the view for alternatives and a broader concept are missing.

Despite of being a dead-end business[3], mining controls Australian politics. Approving of mining projects dominates the agendas of federal, state and council ministers. No wonder that the sheer number of applications and pressure from developers is leading to mistakes. As a consequence, EIA – a tool introduced to protect the environment and responsible for the assessment, evaluation and approval of projects that might have significant negative impacts on the environment – has come under fire from different sides. However, the conclusions that EIA is to blame for not achieving what it promises, is completely wrong.

EIA as a process is not deficient, even if the way it is designed in the EPBC Act and also how it is applied in practice might be questioned. It is also true that there are two main aspects that EIA inherently fails to address – cumulative effects of various projects and the consideration of alternatives to a proposed project. However, these are addressed by SEA which emerged as a concept in the 1990s with the aim to examine and appraise policies, plans, and programs. The strength of SEA is that it explicitly seeks to address the limitations of EIA: it considers alternatives to a proposed project that may be less environmentally damaging, it evaluates cumulative impacts of several projects and it also takes into account the impacts of damaging actions that are not ‘projects’ (e.g. farm management practices). While Australia was one of the earliest countries to have a legal framework for SEA (the EPBC Act 1999), governments have made little use of it. It is thus not the EIA as a tool that is wrong, but its application in a faulty way and it the wrong place.

In the case of mining, SEA would be an ideal tool to evaluate the general direction of the whole sector not every individual project. By assessing many individual coal mines through EIA it is likely that a majority of them gets approved. Even more so, if EIA is misused to modify or disguise a project until it is finally tolerated. However, if coal mining was assessed on a strategic level, it would soon become evident that we can’t afford to have many more coal mines throughout the whole country. Coal mining fundamentally violates the objectives of a sustainable development in general, and challenges current global attempts to address climate change in particular[4]. By a sector assessment through SEA we would find that there are much better alternatives to most coal mining projects.

What Australia urgently needs are policies that are tailored to the challenges and needs of the 21st century. And the government must make sure that policy targets are being met[5]. Hopefully, politicians will remember soon enough that Australia has many other qualities than extracting fossil fuels and that by protecting natural resources rather than depleting them, we can make better profit out of them – in the present and the future.
If so, then two flies could be caught at once: that of an ailing economy and the whole debate around the effectiveness of environmental assessments.

[1] The budget debate, a falling currency, and the Ford closing.

[2] To hold it very simple and superficial, I’m talking about the mining sector and Australia providing the raw material for products consumed in the US and Europe while manufactured in other countries like China and India. It seem logical that consumer reluctance due to the financial crisis affected first other economies and only as the last in the supply chain finally also Australia.

[3] A business based on extracting and selling of finite resources must come to an end sooner or later, if the money is not being used to establish alternative incomes.

[4] Unsustainable elements include: direct environmental degradation in Australia and the countries where the coal is being burnt. Further, indirect negative impacts by market distortions: due to non-internalisation of negative costs, coal is too cheap and thus over-competitive with alternative energy sources. If market prices would reveal the true costs, coal could never compete with renewable energy sources and would have no place in a transparent market. And finally, it also challenges Australia’s targets of the Kyoto Protocol.

[5] Ranked 48 out of 132 nations on the Environmental Performance Index, Australia’s governments do not necessarily meet established policies in the environmental and social sectors.


About blaubear

Born in 1973 in a small village in rural Switzerland and into a society largely dominated by cows (not only was the human population of one-hundred-and-forty outnumbered by them, but politics were driven by unreasonable subsidies for diary products) I was connected with nature from early age on. Observing nature on one hand and the deficiencies of a dysfunctional Swiss agricultural policy with farmers that had lost connection to the land that provided their income on the other, I soon started to question society and the meaning of life. Suffering also under a farcical public education I developed curiosity to discover on my own. That was how I soon learned that little of what I had been taught was true. Skepticism and interaction with people from for me new cultures fostered my interest for the world and eagerness to leave a life shaped by federalistic layman-ship. At the age of twenty-three I hit the road for the first time, an event that later translated into passion. Traveling between cultures has since become part of my life. At the age of thirty-three I finally realized my dream and did a degree in Environmental Engineering from which I graduated in 2009, only to leave Switzerland once more for my "real home" Spain. Unfortunately, the stay was a short one: a couple of months later I was offered a job in Southeast Asia, where I worked and also lived (with some interruptions, e.g. I live in Melbourne since late 2012) ever since. Having worked for a Japanese company earlier in my life, I soon felt captured again by Asian culture and thinking which makes a lovely contrast to my European heritage. My journey through different countries and cultures has taught me that regardless of how different our thinking and values are, no matter what approaches we take, we all can learn from each other. And if we are open enough to see the common instead of pointing out the differences, then we have a chance to live in harmony and peace: Life is all about integration, not exclusion! It's an old wisdom that "knowledge is power", as such I never get tired of being around new people, having interesting talks, and reading lots of good books. I hope that my blog can contribute to the conversation.
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