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Home » Australia and Pacific, Economic Geography, Population Geography

Populating the Pilbara—And the Controversial Phenomenon of Gina Rinehart

Submitted by on December 16, 2012 – 9:18 pm 3 Comments |  
As the previous post noted, the major urban areas of Australia have recently posted significant population gains whereas most rural areas have registered demographic declines. The situation is a bit different, however, in Western Australia, the world’s second largest (by territory) “stateoid” (or first-order political division of a sovereign state). To be sure, the outskirts of greater Perth have seen major population gains just as the agricultural heartland, the so-called Wheat Belt, has lost residents. But the rural Pilbara region in the northwest defies such tendencies, growing at a rapid clip. The Pilbara is still very lightly settled, with roughly 50,000 people living in 193,823 sq mi (502,000 km2), an area roughly the size of Spain. (The region is actually planning to capitalize on its sparse settlement, launching an “international tourism campaign targeting the Pilbara as a place where visitors can come and experience ‘nothing…’”) But with some of the richest mineral deposits on Earth, the Pilbara is developing rapidly, and hence is attracting new residents.

Settling people in the Pilbara has long been a controversial matter, as discussed in a previous GeoCurrents post. The region’s remote location and harsh natural conditions deter settlement, as does its extraordinarily high cost of living. As a result, most mine workers have been employed in a “fly in/fly out” basis, living permanently in Perth and “commuting” to the mines for intensive work stints of a week or two. Mining operations in the region have also invested heavily in automation. Gargantuan robot trucks and driverless trains are among the most recent innovations. But automation cannot meet all of the region’s labor demands, leading to an expanding population. Limited infrastructure, however, has generated a severe housing crunch. In some coastal areas, workers are increasingly living on boats, leading local officials to fret over lightly regulated “boatels” clogging up local harbors. One Australian politician recently described the Pilbara as a “basket case” where residents are “reduced to tears by high rents and inadequate services.”

As many Australians are reluctant to endure such conditions, the Pilbara’s business and governmental leaders are increasingly looking to foreign labor. A local council in the region recently announced that it “wants to import foreign workers for smaller businesses in the retail, hospitality and other sectors that are struggling to secure local employees.” The council is eyeing China and the Philippines as potential labor sources. Earlier this year, the Australian government agreed to a new initiative that would allow the Pilbara mining sector to bring in much larger numbers of workers from abroad. As reported in May by Australia’s ABC Rural news service:

 

The Federal Government has awarded its first Enterprise Migration Agreement (EMA) to Hancock Prospecting’s Roy Hill mine, allowing it to import overseas workers for the construction of the project.

The project is expected to demand 8,000 workers during construction and the EMA will allow Gina Rinehart’s Hancock Prospecting to bring in up to 1,700 foreign workers, but only after genuine efforts have been made to recruit Australians.

The agreement requires overseas workers to be paid the same as locals and also requires Hancock to provide 2,000 training places for domestic workers.

 

This agreement has been highly controversial for several reasons. Australia has long restricted blue-collar migration in order to maintain a high wage structure, and many Australians fear that this policy is now threatened. Some also think that the deal gives unfair advantage to Hancock Prospecting, the privately owned firm that controls vast land leases in the Pilbara, and to its controversial executive chair, Gina Rinehart. Rinehart is certainly a force to be reckoned with. She is often described as the richest Australian and as the world’s wealthiest woman, but such characterization may not do justice to her fortune. Her net worth is estimated to be as high as US$29 billion, and it is growing so rapidly—at A$52m a day*—that some experts think that she will soon become the richest person in the world.

Rinehart’s ambitions are by no means limited to the acquisition of wealth. She has recently purchased major shares in several media organizations, perhaps hoping to use such holdings to sway public opinion. Her political views are deeply conservative. She harshly criticizes Australia’s high taxes and extensive regulations, and she supports groups that deny global warming. She is especially critical of her country’s high wage rates, and she recently shocked many Australians when she declared that “Africans willing to work for $2 a day should be an inspiration.”

The fact that Rinehart’s political activities have intensified of late may be linked to threats to her ever-burgeoning fortune. The Pilbara mining industry, with its iron-ore mainstay, is tightly linked to China’s industrial expansion. As evidence mounts that the Chinese economy is slowing, concern grows in Western Australia that the mining boom may soon run out of steam.

Rinehart’s latest attempt to influence public opinion comes in the form of her recently published book, Northern Australia and then Some: Changes We Need to Make our Country Rich. The work is controversial, to say the least. Crikey (“Independent Media; Independent Minds”) reviewer Cameron Woodhead recently described the book as “weirdly amateur,” with ideas that are “mad beyond the dreams of Tamburlaine.” I was tempted to read the book myself in preparation for this post, until I learned that it contains a substantial selection of its author’s poetry, although doggerel might be the more appropriate term. As Woodhead frames the matter: “if you overlook the Genghis Khan-like sentiments, Gina’s verses are the kind of naïve art — articulate, with some command of metre — that might arouse the admiration of neighbours in the local paper”. He also provides a nice sampling, written in honor of Joh Bjelke-Petersen, a former Premier of Queensland:

 

You travelled far and earned great fame, but always you stayed

loyal

To family and friends who supported you with time and love and

toil.

You spread decency and honour, pride in family and Queen.

And when others wavered from their path, your conscience

remained clean.

We can admire the Sir Joh legacy just by looking around your state.

Parkinson’s has laid you low, but you will always be

The very best Queenslander, especially for me.

 

Bjelke-Petersen was himself a highly controversial figure. As one of the commentators on Woodhead’s review (Christopher Nagle) memorably puts it: “Bjelkes may have been a corrupt tropical fascist bastardo, but he left his state solvent… Bless his miserable rotten heart.”

* As of May, 2012.

 

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  • David Schwartz

    Fascinating. This has all the makings for a mining boom town that will “vanish” when a bust hits, in this case a slowing Chinese economy. I would wonder if there would be another market ready to take its place.

    A minor correction as well: instead of “blue-color migration” it should be “blue-collar migration”

    Keep up the good work this is one of my favorite blogs.

    • http://www.pereltsvaig.com Asya Pereltsvaig

      Thanks for the comment and for catching the typo. I’ll fix it.

      Happy New Year!

  • Late responder

    ” I would wonder if there would be another market ready to take its place.”

    No. China is the major recipient of Australian iron ore (ca. 70%). If Chinese demand were to be reduced considerably companies like Fortescue Metals Group would cease to be. Others such as BHP and Rio would survive but their operations would be wound down considerably, with devastating consequences for the Western Australian economy. Will be interesting to observe what happens when Sino Iron finally starts its operations.

    I don’t see towns vanishing. Due to the ephemeral nature of mines their is a reluctance to build large scale infrastructure. A lot of mining camps and villages are demountable types that are easily deconstructed when the lifetime of the mine expires. That is why existing infrastructure has now become such a hot commodity. I wouldn’t want to be holding a mortgage for a property bought for $1,000,000 predicated on $2,000+/week rent when things take a downward trend. Coastal towns close to gas hubs are probably the safest investment for infrastructure and growth.

    Gina is much loved by Australians (yes sarcasm). The apple doesn’t fall far from the tree. Her father, Lang, said many things that would be verboten now.