Foreign investment fears misplaced, forum told

Joel Fitzgibbon at the Global Food Forum
The Australian | 15 April 2015

Foreign investment fears misplaced, forum told

THE nation’s peak farming group has criticised the Abbott government’s reduced threshold for foreign farm purchases and delays in the release of the agriculture white paper.

Speaking at a politics panel at The Australian’s Global Food Forum today, National Farmers’ Federation president Brent Finlay flagged problems with the reduction in the foreign investment review threshold for farmland from $252 million to $15m.

“We support foreign investment in this country. We are concerned about the $15m threshold that it could become a choke on foreign investment in this country,” he told the forum, moderated by The Australian’s Paul Kelly.

Federal Labor agriculture spokesman Joel Fitzgibbon said by 2050 Australia would need $600 billion of investment to capitalise on agricultural export opportunities.

Political leaders needed to sell the benefits of offshore capital instead of pandering to xenophobia.

“As a country we should be dealing with the community concern about foreign investment and explaining why foreign investment is OK and is important rather than coming up with policy about changing thresholds,’’ Mr Fitzgibbon said.

“That only sends the wrong signals to our investors in a very competitive environment and certainly the wrong signals to Australians and the community more generally who we need to take with us.

“It is designed to send a signal … that there is a problem and the government is doing something about it, when the reality is there is no problem and it will only send more and more applications unnecessarily to the FIRB, it will clog the system and it will do nothing to develop community confidence.”

Fellow panellist and Liberal MP for Hume in NSW, Angus Taylor, said he agreed that government needed to bring the community along on the issue and foreign capital was vital.

“We need huge amounts of investment. Not every dollar of investment is always good — that’s why we have the ACCC and the FIRB. If the objective of the investment is to monopolise, that’s not what we like,’’ he said.

Mr Taylor, an economist and former consultant who hails from a farming background, said there was little apprehension of foreign investment in genuinely rural areas and much of the fear actually comes from outside the areas in the towns and cities.

While the panel discussion featured substantial criticism of government on foreign investment, there was broad praise and support for the government’s performance in clinching free-trade deals with South Korea, Japan and China under the leadership of Trade Minister Andrew Robb.

Mr Finlay also used the panel discussion to call for more investment in rail infrastructure — including the Brisbane to Melbourne inland freight line — to help farmers get product to market.

But Mr Fitzgibbon warned the sector would need to forget about government investment in the current fiscal circumstances.

“Anyone who thinks it will be about government spending in this environment is kidding themselves,’’ he said. “It will be the private sector doing that.”

Mr Taylor said there would be government investment in the sector, but projects such as inland rail would have to be majority private funded.

He said the industry did not have a great track record in bringing forward “investable” projects, but in the past six months that had begun to change with Graincorp bringing some well thought out projects to market.

Mr Finlay also raised the delay in the agriculture white paper as a concern, saying the industry thought “we would have seen it well and truly by now” and wanted to see it released before the budget.

“We are certainly waiting for it. We hope that is not far away,’’ he said.

Mr Fitzgibbon said the delays — as the document was shuffled between ministerial offices — increased the chance that it would be a document of compromise rather than a genuine vision for the sector.

Mr Taylor defended the delays in the paper, saying there were not a lot of people in the industry “hanging their hats” on its release to make investment decisions.

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