BCA urges foreign investment rethink

01 Dec, 2015 04:20 AM
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Business Council of Australia chief executive Jennifer Westacott. Photo by Daniel Munoz
The government should remove specific FIRB thresholds for agricultural land
Business Council of Australia chief executive Jennifer Westacott. Photo by Daniel Munoz

THE Business Council of Australia has urged the government to repeal tough foreign investment rules and pour more money into co-ordinated branding or say goodbye to the $1 trillion needed to develop Australia's agricultural and food processing sector by 2050.

At least they are two of 18 recommendations the powerful business lobby has issued in its latest paper seeking to increase the productivity of Australian industry.

"The government should remove specific Foreign Investment Review Board thresholds for agricultural land and agribusinesses, and restore thresholds to the same level as other sectors of the economy," BCA chief executive Jennifer Westacott said.

"We need a trillion dollars to develop this sector and we are not going to get that by chopping and changing the rules. We really have to be genuinely open for business and have a stable policy environment," she said.

Federal Agricultural Minister Barnaby Joyce hit back suggesting that Australia's agricultural sector had become increasingly attractive to foreign investors.

"They are still lined up out the street wanting to buy," Mr Joyce said.

"Our shareholder is the Australian on the street and they have said over and over again, especially with farmland, they want proper reviews because they see this as indelibly what is Australia.

New laws introduced last week have changed the thresholds at which foreign investors need foreign investment approval to buy agricultural businesses and land.

Coca-Cola Amatil Group managing director Alison Watkins, who was chief executive of GrainCorp when the FIRB disallowed a an American investor from buying it, said the new laws could hinder growth in the sector which already represents around $68 billion dollars per year, or 4 per cent of Australia's gross domestic product.

"It's very disappointing and I am sure we will probably have to live with it for a while," Ms Watkins said.

"You can't have it both ways - if we want to do business with countries than it's only natural they will want to invest in us."

Aside from the sensitive foreign investment recommendation, the BCA has also called for improved branding and consumer understanding. It wants government to increase funding to organisations such as Austrade co-ordinate the efficient branding but at this point the BCA has not identified a specific strategy.

"We are calling for co-ordination from government to get behinds brands that we can develop," Ms Westacott said.

She mentioned the True Aussie brand for export quality red meat which is backed by billionaire Andrew Forrest and media man Harold Mitchell as a key brand to back and evidence tha industry could achieve some level of co-ordination.

Murray Goulburn's managing director Gary Helou said branding was a "carefully structured science" and that ultimately the effort on branding should be with individual companies.

The BCA's committee on what it calls the agrifood sector included representatives from Allens, ANZ, Bain & Company, BCG, Coles, Incitec Pivot, JBS, JP Morgan, King & Wood Mallesons, Lion, SMBC, Murray Goulburn, Telstra and Woolworths.

Other recommendations included improving consumer understanding of genetically modified foods and providing access to skilled labour through visas.

NAB's head of agribusiness, Kahn Horne, who oversees the largest market share of agricultural lending in Australia, said the current economics were highly conducive for further investment in agriculture and associated food processing and that such papers by the BCA "could only be a good thing especially when opening up new markets".

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READER COMMENTS

angry australian
1/12/2015 9:56:18 AM

What a line up of couldabeen champions at the BCA! Not a farmer among them, but plenty willing to exploit the rural sector for everything they can squeeze it for. Supermarkets,bankers,lawyers,stoc kbrokers,foreign multinational food manufacturers,only MG has any claim to being directly tied to the farmer. All the people who have willingly pushed up the cost of production in Australia, many who then voted with their feet and set up offshore. Help us get profitable BCA and we won't need foreign investment, but will that really please Martin Pl & Collins St?
wtf
1/12/2015 1:31:54 PM

Recently reading one parliamentarians maiden speech he said "We have ignored the development of our national infrastructure, yet allowed Australian superannuation savings to develop foreign owned offshore infrastructure." is the answer not there for this investment u seek? how does letting them buy farms translate to investment? it just disadvantages aspiring Australians. Is it a level playing field when these so called investors are gov'ts who can print their own money or go to other countries and pretend to be legitimate companies. What role do currency advantages give them?
Andrew Hitchcock
1/12/2015 1:35:11 PM

Julius Caesar took back from the money changers the power to coin money and then minted coins for the benefit of all. With this new, plentiful supply of money, he established many massive construction projects and built great public works. By making money plentiful, Caesar won the love of the common people. But the money changers hated him for it and this is why Caesar was assassinated. Immediately after his assassination came the demise of plentiful money in Rome, taxes increased, as did corruption.
Andrew Hitchcock
1/12/2015 1:35:56 PM

Eventually the Roman money supply was reduced by 90 per cent, which resulted in the common people losing their lands and homes.
Jock Munro
1/12/2015 7:20:57 PM

The big business toffs can kick and scream as much as they like but the wider Australian public has let it be known that enough is enough and this senseless sale of our assets must stop.

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