Special zone bid for Pilbara

One of the State's most prominent business leaders has called for tax incentives and a free trade zone in the Pilbara to attract more Chinese investment and regional workers and cut the use of costly fly-in, fly-out operations.

Frank Tudor, who runs State-owned regional utility Horizon Power, made the comments in his separate private role as national chairman of the Australia China Business Council.

It comes as the mining industry yesterday attacked a parliamentary report urging limits on the use of FIFO, and recent support by the Federal coalition for magnate Gina Rinehart's steadfast dream of inducements to develop northern Australia.

In remarks timed to coincide with the ACBC's Chinese New Year function, Mr Tudor argued that tax incentives and other measures, including streamlined approvals should be used to drive the next stage of development in the iron ore-rich north.

"Many places have used this in different forms," Mr Tudor said.

"The Chinese have called theirs special development zones.

"Their purpose was to make it easier for companies to come in, and set up their operations, avail themselves of cheap labour and manufacturing capacity that we have now come to appreciate that China has in droves."

While reiterating the need for Australian conditions to be upheld, the ACBC chief said if the WA Government's vision to build sustainable cities in Karratha and Port Hedland of more than 50,000 people was to be realised, the region's high costs would need to be addressed.

This, he said, could partly be achieved by restricting the use of costly FIFO operations to build a bigger local working population.

Chinese investment would dovetail with this by bringing new industrial know-how and job-creation opportunities which would present an opportunity to reduce xenophobia surrounding ventures from the Middle Kingdom.

"The State Government has already done a lot to think about the concept of Pilbara cities, to move away from FIFO and make the cities up there more sustainable, and through all of that reduce the cost of labour and the cost of inputs, which is all part of the challenge of being competitive," he said.

"But I think you can take that concept to the next level . . . and it is a great opportunity if you could open it up, set it up as a special development zone and make it easier for companies to come in and contribute not only economic infrastructure, but also some of the social infrastructure."

However, the mining industry yesterday attacked a Federal parliamentary committee report which urged curbs on FIFO, possibly via changes to fringe benefit tax arrangements for workers.

Independent MP Tony Windsor, who chaired the committee, said FIFO threatened to "hollow out" regions. But Chamber of Minerals and Energy boss Reg Howard-Smith said FIFO provided workers with choice, and was an essential part of $175 billion of resource projects under consideration or being constructed.

The West Australian

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