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Is WA being left out of the business loop?

BUSINESS leaders have identified the need for strategic development and investment in value-adding and key future industries to arrest concerns that WA is becoming little more than a branch office.

Asked “Is WA becoming a branch economy?” several members of the Business News – Business Panel revealed they believed WA must act to identify ways that will allow the State to make the most of its rich resources.

Michael Smith, executive chairman of The Marketing Centre, said WA was not yet a branch economy but needed a development plan for industry.

“To control the capital and the fate of our resources we need to continue to command the expertise to put the projects and the deals together, thus the foreign capital serves us, rather than WA offering up our assets to be exploited on the terms of others,” Mr Smith said

“In this sense, capital is the fuel and management the engine.”

However, the Business Panel was clearly divided on the issue of WA’s status as a branch economy – an issue which has grabbed increasing attention, particularly during the drawn-out saga of Shell’s takeover bid for Woodside.

The division extended to the level of concern about this issue, with some panelists offering anecdotal evidence of problems stemming from dealing with interstate decision makers, while others believed WA has to play to its strengths and not worry about where a company’s head office is located.

Lion’s Eye Institute director Professor Ian Constable was firmly in the “yes” camp, stating that WA and, to a lesser extent, Australia had always been branch economies.

“Economic activity and benefits, however, do not rest solely on ownership, board location or even management control,” Professor Constable said.

“… we have a good education system, a wonderful environment and resourceful people and we must utilise these assets to continue to build new niche companies in value-adding on exports and new startups in the emerging knowledge-based industries.”

BankWest managing director Terry Budge said the issue was not how many head offices were located in Perth.

“The real issue is our ability to attract business operations and new investment to contribute to the expansion of the West Australian economy, particularly for new growth industries such as information, downstream mineral processing and education,” Mr Budge said.

“Our aim must be to build an economy that encourages and creates activities that result in high value adding jobs.”

p See pages 4-5

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