Column: China’s commodity import trend driven by prices, not economy
China's imports of major commodities are often viewed through the prism of the performance of, and outlook for, the world's second-biggest economy.
The founder and chairman of Fortescue Metals Group (ASX:FMG) Andrew “Twiggy” Forrest has framed the company’s efforts to overturn the Australian government’s controversial Minerals Resources Rent Tax (MRRT) as part of a Manichean struggle against evil.
Speaking to ABC Radio Forrest said an appeal recently lodged by the company with the Australian High Court for the tax to be overturned is about battling evil, rehashing Edmund Burke’s quote that all takes for evil to win was is for good people to do nothing.
According to Forrest Fortescue has “decided not to do nothing,” claiming that the MRRT is not only evil but “fundamentally unconstitutional” as it interferes with the rights of Australia’s states.
Forrest lodged an application with the Australian High Court to have the MRRT reviewed in June of this year. The court decided earlier this month that it will accept the application and review the case with a full bench as early as March of 2013.
The MRRT took effect on July 1 and imposes a 30% tax on the nation’s producers of iron ore and coal – Australia’s two chief mineral exports to the Chinese market.
The MRRT has triggered tremendous controversy amongst both supporters and opponents of an increased tax burden for Australian miners. Critics have pointed to its severe inefficacy, with the tax netting zero revenue from the three biggest miners operating in Australia – Rio Tinto (ASX:RIO), BHP Billiton (ASX:BHP) and Xstrata (LON:XTA), during its first three months of implementation.
Image courtesy of Mines and Money via Youtube.
