Port of Newcastle chair Roy Green says Hunter can't rely on being protected from history's headwinds

 

Coal has been an important ingredient of the region's economic success. Yet the increased recognition of climate change and the shift to cleaner energy sources presents us with a challenge.

Ours may be the highest quality coal in the market, but this will not protect us from the day it is no longer needed.

Coal will remain a major export for the Hunter for some time to come, but this must be seen alongside the significant growth and impact of renewable technologies. Even those unconvinced by the climate science cannot ignore that a global transition is underway.

The debate is only about the speed at which this transition is proceeding, and what we should do in response. Ignoring the challenge is to ignore the opportunities, of which there are many. The main opportunity lies in the further diversification of the Hunter's economy. This does not happen overnight. It takes years to create the necessary momentum and decades to fully take effect.

We know the road ahead will be bumpy. The longer we take to begin the process, the rougher the ride. The good news is that we've been here before. Two decades ago Newcastle embarked on a hugely challenging transition of its industrial base with the closure of the BHP steelworks.

The debate is only about the speed at which this transition is proceeding.

Yet since then we have seen strong jobs growth in health, education and professional services, as well as more specialised manufacturing, agribusiness, construction and retail.

Newcastle is justifiably proud of its extraordinary transformation. But it didn't happen automatically through the "invisible hand" of the market. Prior to the closure, business leaders, unions and the community worked together on a transition plan.

There was a shared commitment not only to identify new employment pathways for steelworkers but also to map out future areas of competitive advantage for the region.

However, we cannot allow this success to breed complacency. Changing circumstances require us once again to prepare for another transition, this one possibly even more fundamental and far-reaching than the last. Even from a narrow risk management point of view, the best path forward is to prepare for the worst-case scenario. And once again we will need a coordinated approach across the region. We cannot prepare in isolation.

Done well, the Hunter could quickly become the exemplar for the entire nation, as before with the transition out of steelmaking. It will also call upon leadership and vision in local communities and business, including by the resources sector itself and related industries.

Roy Green is Port of Newcastle chair and University of Newcastle conjoint professor.

Read the full article published in the Newcastle Herald 25/05/19