History
Development of the mining industry in Western Australia has been characterised by its dependence upon cheap energy, international mineral prices and foreign direct investment. It was gold mining that turned Western Australia into a viable settlement. Gold finds in the 1890s followed on from the Gold rush in Victoria and brought unprecedented amounts of people and money to WA.
Gold mining declined after 1904, and Western Australia went through a painful period of structural adjustment over the course of the following three decades during which time two world wars, an international depression and a major drought complicated the state's economic development. Mining began to take off again in the 1930s, however at the time the state governments' focus was in agricultural expansion and manufactoring initiatives. The primary sector would experience strong growth until the early 1970s, after which it leveled off. More then a million hectares of marginal argicultural land was abandoned, and the government turned to mining as the state's main economic priority.
The period after 1945 has been characterised by the development of the State’s mining sector into a world-scale industry and Western Australia’s increasing access to the rest of the world. Communication and transport advances brought Western Australia much closer to the rest of the world, providing opportunities for local producers to access markets in other countries much more easily. On the other hand, overseas producers could access the Western Australian market relatively more readily. The outcome has been a highly specialised and trade-dependent Western Australian economy (with mining and mineral processing the dominant industries), using income derived to import many other goods and services.
The State’s second major resource boom was stimulated when, in 1960, the Commonwealth Government lifted the iron ore export embargo that had been in place since 1938. Demand was fuelled by the buoyant Japanese economy and Japanese, American and British investment flowed into the State. While Asia had previously been a market for Western Australian products (notably sandalwood and wool), the export of iron ore to Japan marked a fundamental shift in Western Australia’s trade dynamic and paved the way for the development of Asia as the State’s most important trading region.
Prior to the resurgence of the resource sector, economic conditions had been relatively subdued, with constant-price household income per capita roughly the same in 1960-61 as in 1948-49. However, the mining boom caused income per capita to more than double by 1973-74. Importantly, while iron ore was (and remains) a significant component of the mining industry, one important aspect of the resources boom in the 1960s that set it apart from the gold rush, was the diversity of commodities being mined. There were major discoveries of nickel, petroleum, bauxite and alumina, which all developed into significant industries in the 1960s and 1970s. There was also a major revival in the mining of gold in the 1980s, stimulated by price increases associated with the end of the gold standard in 1971, high inflation throughout the 1970s, and new processing technology.
Read more about this topic: Mining In Western Australia
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