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BlueScope backs supplier preference

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AAP

2013-02-18

BlueScope Steel has backed proposed laws to force major projects to give local suppliers a fair chance to pick up work.

The issue is particularly pertinent for the steelmaker, which says the illegal dumping of flat-steel products from Asian countries is costing it as much as $100 million a year.

Customs has launched four investigations in steel product dumping since last May, achieving two wins involving penalty tariffs, with two inquiries ongoing.

"We've been very keen to ensure that domestic manufacturers get to play on a level playing field with imported manufacturers," BlueScope chief executive Paul O'Malley told reporters on Monday.

There are claims that some large projects are also abusing tariff concession rules by "packaging" steel products made in Australia with imported products.

That allows them to falsely claim the concessions, which are designed to reduce duties if there is no local industry to protect.

"In some instances where the opportunity is given, Australians won't be able to match an international offer, that's the nature of a competitive market," Mr O'Malley said.

The US was backing its manufacturing industry by ensuring gas being produced from the boom in shale fields was to be used to provide cheap energy, something Australia should be doing but was not, he said.

The government's three-part industry and innovation proposal involves legislating to make sure major projects give local suppliers a fair go, setting up innovation precincts and helping small and medium-sized businesses to grow.

The government says local industry had been concerned that major project developers tended to default to importing materials and equipment rather than exploring what was available in Australia.

While the plan has received widespread support.

However, he plan to cut $1 billion from research and development tax incentives to big business so as to pay for the measures to boost smaller companies has raised concerns it could be counterproductive.

Greg Roberts