LAUNCESTON, Australia, March 18, 2011 (Press Release) -An independent economic assessment of the Bell Bay pulp mill has found that the Tasmanian economy would be close to $10 billion better off as a result of Gunns Limited's investment in the northern Tasmanian mill.
The Insight Economics report, Building a Pulp Mill at Bell Bay, released to the public by Gunns today, detailed the economic impact of building and operating the mill, compared to a business-as-usual scenario of the mill not going ahead.
It was done in conjunction with Monash University's Centre of Policy Studies, due to the credibility of the centre's regional economic modelling expertise and its independence.
Key findings were:
• Total value of the project to Tasmania's Gross State Product would be $9.9 billion to 2030, a return of four times the original investment
• Total value to Northern Tasmanian region (which includes Launceston and the Tamar Valley) would be $3.7 billion and $2.1 billion to the North West region.
• Total value to national economy would be $2.4 billion to 2030
• Total number of additional full-time jobs created in Tasmania would be 3,100 during each year of operation of the mill, in addition to the existing employment in the industry.
• The mill would generate over 11 per cent higher annual employment each year of operation for Northern Tasmania than if the mill did not go ahead
• There would be a flow-on factor, due to the supply of goods and services, of 12 times the direct employment in the project
• The mill would double the value of woodchip exports to be captured by the
• The mill would generate $597 million in taxation revenue for the Tasmanian Government and $391 million to the Australian Government, and
• If Tasmania proceeded with the mill, it would provide a substantial buffer for Tasmania against the ‘two-speed' economy generated by the mainland resources boom.
Gunns' Managing Director, Mr Greg L'Estrange, welcomed the report and its ability to shed some much needed light onto the importance of the pulp mill to the Tasmanian and regional economy.
"The report indicates very strongly that the pulp mill will be the single greatest shot in the arm of the Tasmanian economy in a very long time, and for a long time into the future,"he said. "What this means is that Tasmanians need to think hard about the opportunity that this pulp mill presents.
"This report makes it clear that Tasmania has a lot to gain from this pulp mill. The mill opponents believe Tasmania has a lot to lose.I believe we need to ensure we maximize the gains of the project by positively impacting on businesses in Tasmania. It is not about one sector at the expense of another but how to ensure a healthy coexistence of both. This new study has concluded the impact is better than we previously thought, and importantly it provides an enduring economic basis for the whole Tasmanian economy, not just the forestry sector.
"This is very important as the resources boom in other States pushes up the exchange rate and threatens to create a two speed economy. Gunns' task is to find a way to secure the enormous economic benefits of the mill and work even harder than we already are to mitigate what some people see as the risks," Mr L'Estrange said.
Last week Gunns was granted final environmental approval to build the pulp mill under a stringent state and federal environmental monitoring and reporting regime. It embedded in the permit conditions Gunns' commitment that the mill would source its feedstock from 100 per cent plantation sources.
Gunns had made this commitment as a result of negotiations with key Tasmanian environment groups, and followed Gunns' stated withdrawal from native forest logging.
"This mill is about jobs. It is about a major boost to the Tasmanian economy, and it is about reinvigorating the economic fortunes of Launceston and George Town as the host community, in particular," Mr L'Estrange said. "The Tasmanian economy needs this mill and the forestry income that supports it, just as it needs its tourist and primary industry economic inputs."
Mr L'Estrange said Gunns had also commissioned a study looking at maximising local benefits and minimising potential negative impacts. It was expected to be completed shortly.