Economic case for mining does not stack up

Conservation organisation Forest & Bird says the Government’s economic arguments to justify mining New Zealand’s most precious conservation land do not stack up.

“Forest & Bird commissioned reports from independent economist Geoff Bertram, which show mining of Schedule 4 land will hurt the wider economy,” Forest & Bird Advocacy Manager Kevin Hackwell says.

“So we don’t believe the Government can justify mining some of our most valuable conservation land on economic grounds.”

The Government has claimed economic growth would be boosted by removing more than 7,000 hectares of high-value conservation land from Schedule 4 protection in the Crown Minerals Act on Great Barrier Island, Coromandel and Paparoa National Park.

Dr Geoff Bertram, an independent economist at Simon Terry Associates and Senior Associate at the Victoria University of Wellington Institute of Policy Studies, found that the value of mining on Schedule 4 land would be greatly outweighed by the economic damage of mining to New Zealand’s clean green image, which underpins the $21 billion tourism industry and our food exports.

He also concluded estimates of the value of mining were wildly overstated in figures used by the Government.

The reports quote two previous studies done for the Government of the risk to our 100% Pure New Zealand-branded tourism market, which showed degrading the country’s clean green image would cost around one percent of GDP – equivalent to the entire mining sector’s contribution to the economy.

These studies were done in the early years of the 100% Pure New Zealand branding campaign and before the full impact of the huge global success of the Lord of the Rings film trilogy was felt.

“Since then most of New Zealand’s primary industries have also leveraged their international marketing off the 100% Pure branding. So the economic impact of the mining proposals could be a lot greater if those studies were repeated today,” Mr Hackwell says.

One of the reports exposes as “economically meaningless” Ministry of Economic Development figures that value New Zealand’s mineral resources – excluding coal, gas and oil - around $194 billion because these take no account of where they are and whether they can be economically mined.

Statistics New Zealand’s “Mineral Monetary and Physical Stock Account” values our non-petroleum mineral resources around $1 billion. The areas proposed to be removed from Schedule 4 comprise about 10 percent of the total, with a value of about $100 million, or just $36 for each New Zealand voter.

“Up to 50,000 people marched in Auckland and thousands more in other centres to show they believe mining in our most precious natural landscapes is an attack on our national identity,” Mr Hackwell says.

“Forest & Bird has sent copies of Dr Bertram’s research to all Cabinet ministers and hopes that they will consider at the Cabinet meeting today the potential economic downside of mining and the intrinsic value of these wild places when they make their decision today.”