Excitement is rippling through the mining industry this morning after news broke that Julia Gillard, is now Australia’s first female Prime Minister after Kevin Rudd stepped down from the leadership role.
Mr Rudd had become increasingly unpopular in opinion polls over the proposed Resources Super Profits Tax and the decision to shelve a carbon reduction scheme.
The news of a new PM brings hope to mining execs and investors that Ms Gillard will soften the government’s stance on the proposed mining tax and allow fresh consultation with the industry.
Managing director of Queensland Mining Corp Ltd (ASX:QMN), Howard Renshaw, who recently returned from talks with Chinese investors in Beijing, says the news is positive for the mining industry and provides the opportunity to revise the mining tax and look at the government’s responsibility to the communities that rely on the mining industry.
Mr Renshaw says investors in China relayed their concern to him regarding the tax and the impact it would have on return on their investment in Australian projects.
The proposed resources tax has been a heated topic of discussion in recent weeks with mining firms like giants BHP, Rio Tinto and Fortescue Metals Group warning that billions of dollars in new projects could be hurt or abandoned if the tax went ahead.
RBC senior economist Su-Lin Ong says the odds are that the immediate focus for Ms Gillard will be on the mining tax with a watered down version expected in coming weeks.
She says there is a sense of urgency to get it sorted out and remove uncertainty surrounding the proposed RSPT.
