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Christmas Island - Economy

The main economic activities on Christmas Island are the mining of low grade phosphate, limited tourism, the provision of government services and more recently the operation of the Immigration Detention Centre. The government sector includes administration, health, education, policing, customs, quarantine and defence. The Australian Government supports economic development and enhanced business opportunities in the Indian Ocean Territories through the Community Development Grants Programme. The Australian Government also provides direct assistance to the Christmas Island Tourism Association (CITA).

The Australian government in 2001 agreed to support the creation of a commercial spaceport on the island, however this has not yet been constructed, and appears that it will not proceed. The Howard government built a temporary immigration detention center on the island in 2001 and planned to replace it with a larger, modern facility at North West Point until Howard's defeat in the 2007 elections.

George Clunies Ross and John Murray were granted the right to extract phosphate on Christmas Island in 1891, when the British Government offered them a joint 99 year lease in return for a small royalty. Small shipments began to be exported in 1895 and by 1897 they had formed the Christmas Island Phosphate Company.

Clunies Ross returned to the Cocos (Keeling) Islands and Murray became Chairman of the company. As there was no Indigenous population, a workforce had to be imported from Europe, Singapore, China and Malaysia. The first major shipment of phosphate was exported in 1900. In 1948 the mine was taken over by the Australian and New Zealand Governments, working in partnership with the British Phosphate Commissioners.

In the late 1970s the Australian and New Zealand Governments renegotiated their agreement for the provision of phosphate to the two countries. As part of the process, the British Phosphate Commissioners relinquished the management of the mine to the newly formed Phosphate Mining Company of Christmas Island in 1981. As deposits of preferred quality phosphate neared exhaustion the mining operation faced economic constraints and probable closure. The effects of drought and low phosphate prices led to a government decision to close the mine in December 1987.

In 1990 the mine was purchased by union workers workforce of the previous mining company. Christmas Island Phosphates, now known as PRL, commenced operations the following year after convincing the Australian Government to allow the mine to be reopened. Many of those involved back then are still present in the company today as employees and shareholders.

Phosphate Resources Limited (PRL) trading as Christmas Island Phosphates is a leading producer of phosphate rock in the South East Asian region. The Company's key asset is a 100%-owned phosphate rock mine on Christmas Island, where it has mined and exported phosphate since 1990, and exports approximately 700,000 tonnes of phosphate product each year to Australia, New Zealand, Malaysia, and Indonesia.

The economic foundations of the Island have been built on phosphate mining and that situation remains the same today with PRL being the largest commercial employer in the region. The Company maintains a strong sense of corporate responsibility both in its community commitments and environmental responsibilities.

Phosphate rock is not rare; however it is a non-renewable resource. It is produced in over forty countries in the world, with China, the United States and Morocco the largest producing nations accounting for approximately 68% of global production. Active mining also occurs in Russia, Tunisia, Jordan, Brazil, Israel, South Africa, Syria, Togo and Senegal, with minor production elsewhere.

Currently about 90% of world phosphate rock production is used by the fertiliser industry to manufacture phosphate fertilisers, with the remainder being used to manufacture animal feeds, detergent and chemicals. In recent years the increased need for world food production has assured the long-term growth of world phosphate rock demand.

Christmas Island Rock Phosphate (CIRP) was formed by slow phosphatisation of the parent sedimentary and volcanic rocks over millions of years. The Island is made up of volcanic rocks interbedded with coral limestone, and has been subjected to several phases of uplifting, forming a central plateau at an elevation of 200-350 metres above sea level.

Christmas Island Rock Phosphate's combination of fluorohydroxyapatite, calcium iron and aluminium phosphates make it a highly sought-after phosphate product, which provides benefits in a range of fertiliser manufacturing processes. Its relatively high total phosphorus oxide (P2O5) level improves the analysis of many straight and compound fertilisers, and its iron and aluminium content improves the granule strength of a range of acidulated fertilisers. In addition, its reactive characteristics provide advantages for compacted fertilisers that do not undergo chemical processes.

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Page last modified: 26-07-2017 19:17:10 ZULU