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Answer: Driving up global Q7 prices so that more eAustralian producers can sell at a profit!

The effect of the current damage booster event is just one of the many topics which were under discussion at the weapons industry round table.

A week ago I invited 21 eAustralian citizens who were currently listing one of the top few offers for WRM and Q1-Q7 weapons. 9 responded.

Among them were WRM producers, Q7 producers, Q1-Q6 producers, and locally based import traders.

Several issues were raised related to open market conditions:

-The lack of supply of Q7 weapons at an internationally competitive rate, causing many eAustralians to shop overseas, causing eAustralia to lose out on revenue.

-The lack of a Weapons Bonus Region in eAustralia.

-The high wages that need to be offered in order to attract employees.

-The large number of rubber plantations needed to be manager worked in order to supply each Q7 factory employee with WRM.

-The high cost of Q7 factory upgrades.

These issues contribute to requiring a large initial investment in order to trade a high volume of Q7 weapons profitably in eAustralia, and a long period of time before that investment is fully paid back.

The solutions proposed by participants were these:

-A decrease in the Import Tax to improve supply

-A decrease in the VAT to make business more profitable for local producers.

-Lower wages to enable producers to be able to afford employees.

-Fixing a price.

-Renting a region with a weapons bonus.

-Working in communes.

-Utilising overseas farms and factories in 100% bonus regions.

-Loans to enable producers to upgrade factories or build more mines.

-Mentorship schemes.


My responses, based on input from the discussions:

Import Tax

Recently the Senate voted approve a reduction in the Weapons Import Tax from 15% to 10%. The tally was 12 votes to 4; a majority of 75%.

This change came at my recommendation, in order to fill the gap we are experiencing in supply. If domestic supply improves, or local producers already selling at competitive rates are undercut, I will recommend an increase in the tax. If supply is still not meeting demand after the tax has been in place for some time, a further reduction may be necessary. Personally I believe that 10% should be low enough as I already have a guarantee of increased supply from one importer. In time more may follow.

VAT

Presently I have insufficient data to recommend a decrease in the VAT. Only one WRM producer gave me complete figures on their present production rates. In order to recomend a decrease I would need to following from current Q7 producers:

-How much they are presently selling on the eAustralian market per day/week. And I mean actually selling, not just listing.

-How much they would be willing and able to sell if the VAT were decreased from 3% to 2%.

Based on these figures I would be able to make a judgement as to whether the treasury would earn more or less tax as a result of the proposed change.

Also as the market is currently experiencing a spike due to the damage booster event, I would be basing any figures on pre or post event prices.

Other senators have indicated they may make their own proposals for a VAT reduction, which they are more than welcome to do, however I will not support it until these quite basic conditions are met.

Lower Wages

Unfortunately we are unable to set a maximum wage, and if we could our own citizens may seek better wages overseas.

Price Fixing

This also relies on industry compliance. While setting a price level at which supply and demand balance out ensures consistency of supply and revenue, and is in general sensible business practice, it won't solve the larger problem of an overall shortfall of competitively priced supply.

Renting a resource region

The current geopolitical climate makes renting a neighbouring weapons region for a 20% bonus near impossible at present. Renting a region elsewhere for a 10% bonus has been discussed both in congress and the cabinet briefly, but whether the economics would make sense remain to be seen. It is something we could investigate if producers felt a 10% bonus would make a real difference, and the expected boost wasn't outweighed by the rental cost of any available region.

Communes, overseas production, and other similar mechanisms.

MUs which are fighting in line with official orders and supplying their own troops at their own expense are a special case I am willing to overlook in the national interest.

Otherwise, while I am aware that these arrangements can ensure profitability for some individuals and organisations, my chief concern as MoF is with the eAustralian open market and eAustralian tax revenue. As such I am not in the business of promoting the use of competing markets, aside from in exporting goods surplus to domestic demand, and I do not condone business which operates on the black market, however legal that black market may be. While I am MoF I will not be promoting these as solutions, as I do not believe they are in the best interests of all eAustralians. This is of course a personal opinion and other citizens or elected representatives are free to disagree.

Loans

I have been in discussion with Ilene Dover and others about the possibility of setting up an RBA funded loan scheme. At this time the likely scheme would be loans for owners of of Q7 factories to build WRM capacity, although other options are under consideration. Any proposals would need to be presented to congress for approval. It is likely that these details would be worked out during the next presidential term, so would also be contingent on the successor supporting such a scheme.

Joey Development Scheme

A rejuvinated JDS could have some out of date tasks replaced with economic tasks. These would have the dual benefit of guiding new players in starting out in business, and building eAustralia's economic base. The building of an aluminium plant would be a reasonably simple task to complete, and would provide the player with 10% of the cost back as a reward, and ongoing income via WRM sales. eAustralia would benefit with increased WRM supply, pushing down prices. These are only ideas at present. The reintroduction and funding of the JDS is something which still needs to be discussed more broadly. I plan on releasing a discussion paper in the next couple of days.

Mentorship

This is something I hope that industry can take on for itself. Ideally some of the more established and successful producers could write articles, and provide one on one advice to those who are just starting out or who are trying to get to that next level of production.

Finally...

If you feel that I've missed something or wish to disagree with my presentation of the matter, feel free to post below and I will be sure to listen. I will endeavour to answer all constructive queries.

Gudzwabofer
eAustralian MoF