Victory for Greenies in Australia as $2.2 Billion Plant is Pulped
Environmentalists have claimed a victory in Australia where a major investment bank is said to be canceling its funding of a controversial pulp mill planned by the country’s biggest harvester of old-growth forest timber.
Both the financial sector and the environmental movement were abuzz around Australia last week with the same piece of information. It looked very much like the Australia New Zealand bank (ANZ), one of the country’s top four, had pulled out of its pledge to fund a controversial $2.2 billion pulp mill planned for the southern state of Tasmania.
But of course while the finance sector saw doom and gloom and proceeded to wipe 10 per cent of the share market value of the pulp mill’s developer Gunns Ltd, the environmentalist were giddy with delight. If the rumor is true, and they certainly think it is, it could well be the final shot in a battle that has raged for years between Gunns and environmentalists.
Protest called off
Last week the environmental non-government organisation, the Wilderness Society, cancelled its plans for a major rally against the ANZ Bank over its involvement with funding for the pulp mill.
Wilderness Society spokesmen Mr Paul Oosting, congratulated the ANZ Bank for a socially and environmentally responsible decision to abandon the mill.
“Gunns’ pulp mill would see the destruction of high conservation value forests in Tasmania and the project does not have a social license. ANZ’s decision is in line with its new forest policy and with principles that set a high standard for corporate social responsibility.”
Is it too good to be true
After some initial certainty however, things do not seem so clear cut.
Australia’s national broadcaster reported late last week that both the timber company, and the ANZ Bank were denying the speculation. The bank left the door opened when it claimed it was waiting for Gunns to clear more regulatory hurdles, before finalising its decision on funding.
So is all this just another story in a world were economic growth clashes with environmental concerns every day, not at all.
A historic battle
The issues of forest logging in Australia’s smallest and southernmost state, Tasmania, has been the center of many political debates that have raged across the country, and arguably helped determine the outcome of recent federal elections.
In a nutshell Gunns is the monopoly timber operator in Tasmania were it affords good protection from the state government. Proponents saw it provides jobs and is the power house of the Tasmanian economy. The links between the state government and the company are strong and the ‘revolving door’ is in operation, state government politicians and employees frequently end up working for the company
Old growth for paper products
The problem for environmentalists is that Gunns chops down some of the oldest native forest ecosystems in the world to supply the paper pulp markets.
To add insult to this injury the company planned a huge “world class” pulp mill to help it add-value to its timber products and of course, provide more jobs and economic growth for the state.
But what a process pushing the mill has been. There have been endless committees, reports, consultations and regulatory hearings all they way to the country’s highest government levels. All trying to determine just how much pollution the new plant would be allowed to create in pristine Tasmania.
But the arguments either way haven’t changed anybody’s mind, you were either for it or against it.
Determined despite the odds
Indeed all seemed lost for the environmentalist when even the prospect of a new federal government, which would include the former rock star with Midnight Oil, and one-time fervent environmentalist, Peter Garrett said they would support the new mill.
The last hope for the environmentalists was to target Gunn’s financial backers. And in a testament to conviction it looks like they may well have pulled it off.
Not that environmentalists will be given the credit of course, they rarely are. One of Australia’s leading financial commentators Alan Kohler, has said that considering all the turmoil in world markets it is very unlikely the financing will go through.
Everyone wins, but Gunns
This also means that the ANZ can save face and duck accusations that it was running scared of the reputational damage of being involved with the pulp mill. But somehow I don’t think the environmentalist will mind this one little bit.
Hi, I am a longstanding small time investor and sometime participant in the Tasmanian timber industry.
It has been generally agreed that local value added wood processing is sorely needed in the industry.
For too long it has been a price taking supplier to (mainly) Japanese and Taiwanese wood fibre producers.
Some years ago, a government was elected on the strength of its support for a fibre manufacturing plant.
This began the unremitting campaign by opponents of the plan.
The opponents seem to consist of a combination of environmental advocates, regional advocates and competing industry interests.
At present, the Australian pulp industry is highly concentrated, approaching a duopoly.
True to the form of duopolies, corruption is endemic, last year a leading manufacturer was fined millions of dollars after being involved in a price fixing scam.
Opponents claim that process effluent would inflict serious damage on the people and the ecosphere.
Although they have not been able to substantiate the poisoning claims (the project has obtained regulatory approval after years of deliberation), they have gained credibility in a world where change and the rate of change has engendered confusion and disorientation amongst many people.
The mill is a tangible focus for concern about the unremitting and uncontrollable change occurring in other areas of life.
The criticism of the has been extended to include other aspects of Tasmanian politics and business.
Like many other cloistered economies, it is rife with rent seeking and entrenched protection of the existing establishment.
The state will go to great lengths to protect local commercial interests.
For example, it continues to maintain an illegal ban on the import of apples and some fish and meat products into the state.
The opponents have succeeded in hanging all that is wrong with Tasmanian business and society on the upcoming construction.
Fixing these things will take a change of outlook on the part of those who hold power and those who seek to influence them.
This may or may not happen, but in the meantime we still need a fibre production facility.
If nothing else it will improve the value we get from our wood, something most participants in the debate agree is needed.
The Gunn’s proposed pulp mill IS environmentally dangerous, detrimental to public health (The Australian Medical Association opposes it.)The so-called approvals process was achieved by scrapping the RPDC (independent tribunal) process, by Gunn’s tactics and corrupt political involvement by fromer (recently dumped) Premier, Paul Lennon. If faced with truly independent environmental assessment, this project would never have gained approval. The vast majority of Tasmanians deplore the circumspection of democratic processes, political corruption (which lead to two deputy Premiers axed and before the courts); as well as the threats to health, endangered species and the marine environment that this mill will create. This mill is only beneficial to it’s proponents (Gunn’s). Check out the Tasmanian Greens Website, the Wilderness society and the Australian newspaper to see the opposition to the above pro-forestry and pro-Gunn’s propaganda. The truth is out there, it’s easy to see despite the corporate spin!
I agree with you, Bryan - the truncated fast-track approval process instigated by the mill’s biggest cheer-leader, Paul Lennon (now ex-Premier of Tasmania)was what got most people in Tasmania off-side. Lots of these people support down-stream processing, but want it looked at in a fair, un-biased way, taking heed of not only the ‘benefits’ expounded by the company, but also any possible adverse effects. In fact we have asked for nothing more and nothing less than a full cost/benefit analysis, not simply a ‘benefit to Gunns only’ analysis, which is what we were being asked to swallow. Tasmanians Against the Pulpmill (TAP) - a grass-roots community group with members from all walks of life, not an aligned “green” group - has fought tirelessly for years for this mill to be properly assessed. We have some powerful allies. I do not think this mill can now proceed, and Gunns would be well advised to look elsewhere to value-add. The TAP website (www.tapvision.com.au) gives plenty of detailed and expert opinion on matters regarding this mill proposal, as well as links, for anyone wanting more info. The “Victory for Greenies” headline to this article is something of a mis-nomer - the victory is for the whole of the thinking community of Tasmania.
There are many issues arising from Gunns planned pulp mill which local communities are absolutely fired up about. One example is the pulp mill enabling law passed by the politicians who are supposed to represent the people. Section 11 of that law blocks citizens from being able to go to courts to claim compensation for damages to health, property values or their business arising from the pulp mill eg loss of income from tourism markets due to smells emanating as fugitive emissions which are trapped in the Tamar valley. See http://www.tapvision.info for more information.
Thanks for all those comments…
Mike you make a very interesting point, perhaps an idea for another story, just how many civil rights have been obliterated in Australia over the last 10 years, and is there any chance of getting them back.
You are all no doubt aware that Gunss has since fessed up to the fact that ANZ has pulled the plug on the mill, but has also vowed to fight on…
alas the fight never ends..
Great work from concerned citizens locally and nationally in bringing a major bank to task on investment in this very corrupt development proposal. A great victory for common sense. Congratulations ANZ.
Michael said that the project had obtained regulatory approval, as if that indicated that there were no continuing valid environmental concerns.
For the benefit of anyone who might be misled by his comments, the mill project assessment process was abandoned by Gunns and the Government when it became clear that the proposal was failing to meet the assessment guidelines. The government then used its parliamentary majority to have the parliament assess and approve the proposal - after receiving a ‘Mickey Mouse’ report from SWECO PIC, supposedly an independent company, but actually one of the players in the process.
There are plenty of people around who wouldn’t mind seeing downstream processing happening in Tasmania. The proposal when it first got off the ground, promised a different location, chlorine free and closed loop. Once this got acceptance, then they started changing it.
The other problem is of course, the company Gunns. It has demonstrated a greed that is destroying our island.