Rinehart: cut costs to survive, Australian tycoon

Mining tycoon Gina Rinehart has warned Australia needs to rein in business costs to remain competitive and avoid heading for a European-style crisis. The iron ore magnate, chairman of Hancock Prospecting and the world's richest woman, said people would not buy Australian produce "because we're nice people". "They're going to buy our produce if we keep our costs down," she said at the launch of her book, "Northern Australia and Then Some", in Sydney Thursday evening. "One of the things that I'm really concerned about is the cost competitiveness of our industry because our industry doesn't sell on the local market, it sells on the world market." Australian mining projects have faced headwinds from depressed conditions in Europe and the United States, softening growth in China and increased competition from other producers as well as falling commodity prices. The price of iron ore, a crucial ingredient in steelmaking, has fallen dramatically in recent months as the Chinese economy slows, while the price of coal, another major Australian export, has also dropped sharply. Rinehart said she was also concerned about the investment climate for Australian corporates, in comments carried by Fairfax Media, of which she is a major shareholder. "We don't want to see Australia continue on a course with too many heads buried in the sand, critical investors discouraged by bad policies, even hated, too few understanding the problems while Australia moves towards being another Greece, Spain or Portugal," she said. "We need to focus on earning, not spending and we need to have a good environment for investment." Rinehart has previously blamed the government's mining and carbon taxes, red tape and high wages for making Australia "too expensive and too uncompetitive", sparking an attack by Treasurer Wayne Swan over her "self-interested" campaigns.