Businesses seek certainty, predictability amid uncertain geopolitical times
Businesses across Australia are expressing concerns over the rising fuel costs amid the conflict in the Middle East, and are turning to the government for a national strategy to address the emerging crisis.
Groups representing employers across Australia are looking at the rising fuel costs' impact on businesses, particularly on their operating costs, as the conflict continues.
Andrew McKellar, chief executive officer of the Australian Chamber of Commerce and Industry (ACCI), said in a radio interview last week that the pressures from the conflict in the Middle East will have a "big flow" on Australia.
"We are concerned. I mean, we're not panicking," McKellar said in the interview.
"We can ride this out for a period, but if we face a prolonged conflict in the Middle East that goes beyond another three or four weeks, then globally the economy, the pressures in the global economy will be significant and will have a big flow on here in Australia."
McKellar highlighted two issues stemming from the conflict, with the first being about fuel security, and the second being the inflation risk.
"There's the fuel security question, which in Australia we've never done well enough in terms of planning ahead for this day," he said.
"And of course the other side of it then is the inflation risk and how it adds back into consumer prices and then ultimately into the supply chain and costs for businesses again."
The Australian Industry Group (Ai Group) also said businesses are looking for "as much predictability as is possible" amid uncertain times.
"A fragmented approach would inhibit our ability to manufacture and deliver the food, medicine and other essential goods and services that the economy demands," the group said in a statement.
Government measures on fuel crisis
To address the emerging crisis, the federal government is establishing a new Fuel Supply Taskforce that will be led by former Climate Change Authority chief executive Anthea Harris.
Harris, as the Fuel Supply Taskforce Coordinator, is expected to ensure Australia is "overprepared and quick to respond when facing fuel and other supply chain challenges" arising from the conflict in the Middle East.
She is also expected to:
- Drive coordinated action between the Commonwealth and the states and territories on fuel security and supply chain resilience.
- Provide consistent, coordinated updates to the Commonwealth and states and territories on our fuel supply outlook as well as our domestic fuel distribution.
- Support state and territory governments to get fuels to their regions where they are in demand, and act as a single convening point for fuel supply and forward planning
The Ai Group has welcomed Harris' appointment, saying she will help drive coordination between the Commonwealth and the states and territories.
"Both households and industry need a predictable and certain environment as we work through uncertain geopolitical times," the group said in a statement.
"We need to manage this growing fuel supply crisis in a co-ordinated way, and states should not be tempted to develop a local response with different rules in each jurisdiction – our federation needs to be able to respond effectively."
The group said in a separate statement that businesses "would not look kindly" on states that will go their own way and establish different rules and standards in response to the emerging crisis.
"If states were to go it alone or a national approach fragments, it would again send a message to industry and households that our federation is incapable of responding cohesively in times of difficulty," it added.
The ACCI also welcomed the appointment of Harris, calling it a step forward in securing the country's energy needs.
"What business needs right now is certainty about energy supplies and any moves that ensure equal distribution to business is to be supported," said McKellar in a statement.
"It is critical to keep the business sector moving for the sake of the economy and we echo the government's comments that panic buying of fuel helps no one and must be discouraged."
