Why Kidman ruling makes sense

25 Nov, 2015 01:00 AM
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Federal Agriculture and Water Resources Minister Barnaby Joyce.
We need to think much more carefully about how much of our country we sell off
Federal Agriculture and Water Resources Minister Barnaby Joyce.

OPINION: IF the various properties that constitute the Kidman cattle empire were consolidated into one place they would form the land mass equivalent of the 38th largest state in the United States – roughly the size of Kentucky or Tennessee and larger than the states of Indiana, South Carolina, Maine and West Virginia.

If you were to do the same exercise with countries in Europe the consolidated Kidman properties (101,411 sq km) would be larger in size than Hungary, Austria, Portugal or the Czech Republic.

You could fit almost two and a half Switzerlands into the one Kidman empire.

To put it another way, if the properties comprising S. Kidman and Co were a country, that country would rank 106th out of the world’s 195 nations, just nudging out South Korea (99,909sq km).

Australia has arguably the most liberal foreign ownership laws in the world.

Unlike many countries in the world, including our trading competitors, we welcome foreign investment, particularly in the agriculture sector.

However, that does not mean Australia should have an open slather policy, that there is not a national interest component to foreign investment.

The Australian people need to have oversight of our most precious asset which is the land they stand on.

Last week, the Treasurer Scott Morrison announced that the acquisition of S. Kidman and Co by foreign investors would be contrary to the national interest.

He cited both national defence and the size of the portfolio in his reasons for not authorising the sale under the Foreign Acquisitions and Takeovers Act.

It is a decision I support.

The Treasurer’s decision is a sign to the Australian people that foreign acquisition is not just a tick and flick exercise that will permit any sale to go through.

If all of Australia was up for grabs we would slowly lose our sense of nationhood.

The Kidman estate comprises 1.3 per cent of Australia’s land mass but more significantly 2.5pc of Australia’s agricultural land.

What other country in the world would simply wave through the sale of one 40th of its agricultural land without a query?

The Labor Party’s inconsistency on this issue is mind-boggling.

First they tried to thwart the China Free Trade Agreement, backing a xenophobic campaign by the CFMEU, but now have changed their mind again, arguing that any Australian property or asset should be waived through no matter the long-term consequences for us as a nation.

According to the US Department of Agriculture’s most recent survey of Foreign Holdings of US Agricultural Land released in 2013, the total amount of foreign owned agricultural land is just 104,068 sq km – only slightly larger than the Kidman estate that is being offered for sale.

Texas has the largest amount of foreign held land in the US (11,714 sq km) but just 1.9pc of all privately held land in that state.

Other states have higher proportions of foreign-owned agricultural land including Alabama, Maine, and Nevada, but overall the total foreign ownership of US agricultural land is just 2 per cent.

Compare this to Australia where 12.4pc of Australia’s agricultural land has some level of foreign ownership and that figure is likely to have grown since the last ABS survey in 2014.

To put this in perspective this is the equivalent of 2.3 times the size of the State of Victoria.

In recent years foreign ownership has accelerated with foreign entities realising the huge financial benefits in investing in Australian agricultural production.

In the rush to win real estate commissions and quick foreign income sometimes we need to pause and consider the national interest.

Critics of the Kidman decision say that this is xenophobia and that Australia has depended on foreign investment for developing our agriculture sector since the time of the 1788 first fleet.

But this is nonsense.

The decision recognises we are living in a totally different world in the 21st Century in terms of agriculture and food supplies – good quality agricultural and water assets in safe geographical locations are increasingly scarce resources.

Foreign investors and many foreign governments can see this – it’s well overdue that Australians did also.

We need to think much more carefully about how much of our country we sell off for short-term dollars and what we might be losing over the longer term.

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READER COMMENTS

Jock Munro
28/11/2015 4:24:52 AM

Try leasing land in other countries David Blacket. If we are going to lease something for 100 years we may as well sell it- and how do you get something back after 100 years?
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