Tanya Plibersek (Sydney, Australian Labor Party, Deputy Leader of the Opposition) Share this | Hansard source

The Minister for Trade and Investment has delivered a very important statement today about the importance of trade and investment. Of course, there is a great deal on which Labor agrees with the minister when it comes to trade and investment. Labor has supported trade liberalisation for decades. We know that it boosts growth, creates jobs, forges more competitive industries and gives consumers greater choice and lower prices. Labor governments have opened up our economy and our society to the world by bringing down postwar tariff barriers; by floating the Australian dollar; by deregulating our banking sector; by pursuing multilateral trade liberalisation; by initiating the Asia-Pacific Economic Cooperation forum, APEC; by working to bring together G20 leaders to respond to the global financial crisis and by working with that same group on issues like base erosion and profit-shifting and inclusive growth to underpin sustainable economic growth in all of our major economies; and by identifying and embracing the opportunities for Australia in our region by placing the Australia in the Asian Century white paper at the centre of our national debate and opposing protectionist responses to the global financial crisis at home and abroad.

We have done all of that because we support trade and investment. One of the things that is curious about the recent discussion we have had is the mixed messages that the government have sent out in this area. Competitive global trade has contributed to significant, real price reductions for Australian families. We are happy when Australian families need to spend less on their cost of living. Our policies, including trade liberalisation and the opening up of Australia's capital and investment markets, under the Hawke, Keating, Rudd and Gillard governments, have contributed to over two decades of continuous economic growth. So there is much on which we agree with the minister. We know that investment is the lifeblood of any economy. A growing economy needs to attract and generate investment in new businesses and in the expansion of existing businesses. It needs investment in new factories, new buildings, new equipment and new technologies. It needs investment in new products and new production processes, innovation in the kinds of goods and services we produce and innovation in how we produce them. A growing economy needs both private and public investment, because we know that investment today creates the jobs of the future—private investment in entrepreneurial new ideas and business ventures, and public investment in the critical infrastructure that underpins productivity, healthy workers, educated workers, strong and modern transport and communications networks, and high-quality education and health care for our people. That is why we support policies which promote and encourage investment in our people and in our economy, investment in sound macroeconomic management to ensure a stable and growing economy and to encourage business and investor confidence; policies designed to ensure our economy is characterised by competitive, efficient and well-functioning markets, the central role of financial markets in ensuring capital and savings are efficiently channelled into new investment opportunities, and the importance of Australia being an open economy so that we can tap into and take advantage of trade and investment opportunities in the global economy.

We agree with the minister's observations that trade and investment are two sides of the same coin and with his reminder that Australia has historically relied on foreign capital to meet our domestic investment needs and to build growth into our economy. The fact is that Australia's pool of domestic savings is not large enough to adequately fund all of the investment that we need to build and expand our economy. It is one of the very important reasons that Labor developed Australia's superannuation system. It was to increase the pool of domestic savings available for domestic investment and, incidentally, for investment overseas. Superannuation savings helped bring Australia through the Asian financial crisis and through the global financial crisis, because we were less reliant on sources of overseas capital. If Labor's low-income superannuation contribution and our proposed increase in the superannuation rate to 12 per cent had not been abandoned by this government, Australia's national pool of savings in superannuation would be $500 billion higher by 2037 than it will be under the current settings. So we need to supplement our local savings with foreign investment to create the jobs of the future.

We must always ensure that we remain an attractive destination for foreign investment and that we do not impose unnecessary barriers on that inward investment. Foreign investment has always been essential to Australia's economic development, and it is essential to our future prosperity. The National Farmers' Federation has stated, for example, that for Australian agriculture to meet rising demand, investment of between $1.2 trillion and $1.5 trillion is needed over the next 35 years.

This government has imposed new barriers to foreign investment in Australian agriculture and agribusiness. A complex regime of differential and discriminatory thresholds for Foreign Investment Review Board screening of proposed investments has been adopted, with no explanation and no foreign policy or economic policy rationale. The investment screening threshold for investors from China, Korea and Japan has been reduced to $15 million. For investors from Singapore and Thailand that threshold is $50 million. For investors from the United States, New Zealand and Chile the threshold is $1,094 million. These new barriers even apply where existing investors seek to make improvements to their property. So the new rules are not just a deterrent to potential new investors but also a disincentive for existing investors to improve their operations.

The government is also proposing to reduce the screening threshold for investments in agribusiness to $55 million—and agribusiness has been so broadly defined that it would include around half of Australia's food manufacturing industry. Again, discriminatory rules will apply, with investors treated differently depending on their country of origin. Investors from China, Korea and Japan will be subject to the new $55 million screening threshold, while investors from the US, New Zealand and Chile will again be subject to a much higher threshold.

In this year's budget the government also announced $735 million in new application fees for foreign investors. That makes Australia one of the very few countries in the world which effectively imposes a tax on inward investment. This government is making Australia a less attractive investment destination. Their changes to foreign investment will make it harder for the agriculture and agribusiness sector to raise capital and will put downward pressure on the value of farm assets. So it is no surprise that these new barriers to and this new red tape on foreign investment have been criticised by    the Business Council of Australia, the National Farmers' Federation, the Australian Food and Grocery Council, the Queensland Farmers Federation and the Western Australian Chamber of Commerce and Industry.

But it is not just about agriculture and agribusiness. This government has a very mixed record on investment. They rejected ADM's bid for GrainCorp. They have cut funding to leading drivers of tech investment like the CSIRO and NICTA. According to a mining 'best places to invest' index, Australia has slipped from first in the world to second for the first time in about seven years. Australia has also gone from fourth to 10th in the Renewable Energy Country Attractiveness Index and from No. 4 to No. 37 in the Global Green Economy Index.

Labor supports trade and investment and consequently supports the China-Australia Free Trade Agreement, because it will drive growth, create jobs and improve living standards. We have been the party of trade liberalisation for decades. We have been the party of Asian engagement for decades. Economic engagement with China has been critical for our growth and will be critical for our future. Unquestionably China has become the dominant economy in our region. That means that there are enormous opportunities for Australia from boosting trade with China. We understand the potential benefits of the China free trade agreement and we have worked hard to bring this agreement into being. So it should be clear to the Australian public where Labor stands on this. We support the best possible free trade agreement with China but we want safeguards for Australian jobs. We want a high-quality free trade agreement that creates high-skill, fair-wage jobs for Australians. For the benefit of those opposite, I repeat what Labor wants to see in the enabling legislation: firstly, mandatory labour market testing for projects over $150 million, ensuring that Australian workers actually get the first opportunity before overseas workers are brought in on these projects; secondly, an assurance that Australian workplace skills and safety standards will be maintained; and, thirdly, an assurance that Australian wages will not be undercut.

The minister himself has quite rightly said, 'It is not difficult.' It is true: it is not difficult. We want to ensure that the enabling legislation is finetuned so that these elements are delivered on. But the government will do anything rather than sit down at the table and discuss our sensible proposals. We saw last week that they have embarked on a rebranding exercise. We have seen a doubling of the market research budget. 'What is it that people want from their free trade agreements?' you can hear them asking in the groups sitting down around the market research table. They have an extraordinary advertising budget—which I believe, sadly, the minister has been berated for not spending quickly enough before the Canning by-election. And last week we saw the result of this market research and rebranding exercise. The China-Australia Free Trade Agreement has been rebranded an 'export agreement'. It is really interesting, because I think this agreement covers both exports and imports and I do not think Australians are silly enough to fall for a simple name change when it comes to their concerns to ensure that the number of high-quality Australian jobs increases under this agreement. This government would rather have a fight than have a conversation about getting the details right. Once again I say: let us give up on the rhetoric and on the sorts of stunts that we saw last week and let us get these safeguards in place for Australian jobs. Let us talk about upholding Australian safety standards, upholding Australian pay and conditions and supporting Australian jobs. That is what is important. Let us get on with it.

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