Graham Perrett (Moreton, Australian Labor Party, Shadow Assistant Minister for Education) Share this | Hansard source

[by video link] I speak today on the Export Finance and Insurance Corporation Amendment (Equity Investments and Other Measures) Bill 2021 and do so from Sunnybank on Yuggera and Turrbal lands. I particularly thank the member for Brand for her very comprehensive presentation of the Labor support for this bill.

We support this bill because it will give Australia's export credit agency, Export Finance Australia, or EFA, a new equity investment power and the ability to provide standalone overseas infrastructure guarantees. Importantly, it will allow EFA to make investments in a broader range of infrastructure projects and at an earlier stage of development. Providing EFA with the ability to make equity investments, the bill brings EFA into alignment with its international and domestic peers, including the United States, China, Japan, South Korea and Canada. These boosted financing powers will be used to support important infrastructure investment in the Indo-Pacific and export link projects here in Australia.

In evidence to the Senate committee inquiring into this bill, DFAT and EFA assured committee members that there will be constraints on equity investments, in particular that they would be considered only for significant transactions that support Australia's national interests—something which has particularly come into focus during these COVID times, when we work out what our sovereign capacity is. Other constraints on the equity power by way of a direction from the Minister for Trade, Tourism and Investment and an updated statement of expectations to EFA will include that equity investments will be limited to the National Interest Account—that is, the Australian government, not EFA, will make the final decision on equity investments; equity investments will be limited to a minority interest, unless there is a compelling reason otherwise; equity investments should be $20 million or higher, unless there is a compelling reason otherwise; EFA will bring forward proposals only where other financing options are unavailable or inadequate; EFA will ensure that equity investments have appropriate exit arrangements and target commercial rates of return; and EFA will encourage participation from the private sector and like-minded governments and multilateral bodies.

These constraints will be important to ensure that EFA is not crowding out private finance but instead is filling a gap in the market. I say this because, obviously, the price of capital is at an historic low, with the lowest prices in terms of borrowing money since the first Sumerian hung out their lending shingle. Nevertheless, the mainstay of EFA's support to Australian exporters and for overseas infrastructure development in the region will continue to be debt solution, like loans, guarantees, and bonds.

EFA plays an important role in supporting Australian businesses. In 2019-20 it provided $1.1 billion to support 136 Australian businesses. In turn, this enabled $2.45 billion of export contracts, supporting around 10,000 jobs in Australia. I know how important it is to support Australian export businesses, having previously been deputy chair of the Trade Sub-Committee in the 45th Parliament. I know that exporting Australian businesses hire 23 per cent more staff. I know that exporting Australian businesses pay 11 per cent higher wages than nonexporters. This is very significant when the nation has effectively had a pay freeze for about eight years under the coalition government, and some sectors are actually going backwards. So Labor well understands that we are a trading nation. The more opportunities our businesses have to export goods and services to the world, the stronger Australian industry will be, and obviously that means more jobs for our people.

The Senate Standing Committee on Foreign Affairs, Defence and Trade completed an inquiry into this bill and recommended that it be passed. However, their report highlighted some key issues raised by stakeholders. Some were concerned that financing infrastructure in the Indo-Pacific region would not take into account the priorities of the recipient country. I know that, fundamentally, the Morrison-Joyce government does not believe in stakeholder consultation—certainly not thorough stakeholder consultation. They have an arrogance that would make the Queen of Sheba blush. The Prime Minister has his nose so high in the air, he can see his own derriere on occasion. Further to this dearth of consultation, I note that a joint submission to the committee by Jubilee Australia Research Centre, the Australian Conservation Foundation and ActionAid Australia argued:

Infrastructure investments in the Indo-Pacific region should be led by the priorities of the relevant country, not by the national interest of Australia or the commercial interests of Australian businesses. Australia’s Pacific neighbours have clear priorities for infrastructure investment, and supporting these initiatives should be prioritised.

The committee noted that DFAT has commissioned Mr Stephen Sedgwick AO to conduct an independent review into the infrastructure investment operations of EFA. This review was announced following the 2019 amendments to the EFIC Act to enhance EFA's ability to finance infrastructure projects. One of the terms of reference of that review is to consider the operation of EFA's overseas infrastructure financing functions and the extent to which it has supported the government's aims and the infrastructure needs of our Pacific neighbours. This is basically about whether Australia is being a good neighbour. And that's crucial for our safety.

Our Indo-Pacific neighbours are right now charting their recovery course from COVID-19 through economic constraints and development changes. Some have been buffered by isolation, while many have been buffeted by the crash in tourism. Australia should strive to be a partner of choice for our crucial and important Indo-Pacific neighbours. We should listen to their concerns, understand their recovery efforts and support them with actual resources, not hollow words and a $12 billion cut to aid.

We as a nation are not doing enough in our patch. The coalition speaks well but acts poorly. Frances Adamson, a former top diplomat who is very well respected, noted in her farewell address that our development program needs to match the tough competition for influence that's taking place right now in our region. This is a national security issue, but what have the Morrison government—or the coalition government, to be fair—actually done? They've cut $12 billion of development assistance. That means we've sliced off about $12 billion pieces of influence in our region. There is no such thing as retrospective goodwill in diplomacy. It's always what's happening now. The milk sours very quickly in the tropical sun, and, when you mix that with sour grapes, well, obviously nobody wants to drink that foul brew.

This lack of vision by the Morrison government is leaving opportunity to wither right before our eyes, particularly while there are other state actors active in our region. This is in sharp contrast to how Labor has always thought about foreign policy, right back to Gough Whitlam. Labor has always emphasised the need to face up to the realities of the world and the world that we live in. In his first overseas visit as Labor leader, the member for Grayndler travelled to Jakarta, our close neighbour. That was a clear recognition that Australia and Indonesia, along with other ASEAN partners, share a deep interest in regional stability, sovereignty and prosperity. Think of all those markets right to our north. Labor understands that these relationships take work—showing up matters, as does not snubbing our neighbours or having a meal while they're talking.

Most recently we've seen the Morrison government's short-sighted treatment of Afghan civilians who worked alongside Australian soldiers and our diplomats—the people who wore Australian uniforms to keep Australians safe and put themselves in harm's way, or those community activists, or women, or people concerned about security, who put their hands up and stood up and were then told, 20 years after they stepped forward, that we're stepping out. I'm grateful for those that have been brought to safety, obviously, but the Morrison-Joyce government should have acted sooner. It's too little, too late. In February last year, former President Trump was putting in place the first plans for the US withdrawal. He was sitting down, negotiating with the Taliban in February last year. That's when we should have been starting to make preparations. The government should have acted sooner than they did. Labor has been calling for the fast-tracking of this process to bring these Afghan civilians to safety for many, many months, even when we pulled our diplomatic staff out of Kabul.

The Morrison government has been incredibly short-sighted. It is in our national interest and it is in the interests of our troops and veterans to make sure we bring these brave friends, these brave allies, to safety. Neglecting the people that risked their lives for us will irreparably damage our ability to recruit local staff in future conflicts or in peacekeeping operations in the Indo-Pacific and all around the world. The message will be out there that when the going gets tough, Australia will desert you. That is not the Australian way of diplomacy. The efforts of Australia to retrieve these people are poor in comparison to the efforts of other countries. It's first and foremost about being a good friend, a good neighbour and a good ally, come the tough moment.

Our national security is also inextricably linked to our economic security. The Assistant Treasurer, in his second reading speech on this bill, noted the importance of Australia's export sector. He said:

… Export Finance Australia supported 136 Australian businesses with $1.1 billion in support, enabling $2.45 billion of export contracts which supported just under 10,000 jobs in Australia.

I absolutely agree with supporting the export sector. I'm almost as enthusiastic as the member for Brand when it comes to trade—but not quite!

Sadly, my focus is always on our fourth-largest export industry, which was recently our third-largest export industry—that is, education. Overseas students and universities have not been supported by the Morrison-Joyce government; in fact, it has totally neglected this sector. The Prime Minister was so intent on not supporting universities that he changed the rules three times so that universities could not receive JobKeeper. We've lost 17,000 to 19,000 jobs and all that expertise. The minister spoke of job opportunities for export businesses. That's true, but, conversely, without support and with no international students, we've seen over 17,000 jobs lost and hundreds of courses cut.

Just this week, the Australian newspaper—that great ally of the Labor Party!—reported that the teaching of Asian languages in universities is in freefall. Deakin University professor Ly Tran said:

This underpins a crisis in national capacity building, affecting our future trade and engagement within the Indo-Pacific.

How can we speak to our neighbours if we don't share a language with them?

Professor Ly Tran says there are strategic languages identified by the Australian government—Chinese Mandarin, Japanese, Indonesian and Hindi—because they're crucial to Australia's economic, social and political prosperity. But universities have already closed some of these key language programs. Swinburne University of Technology has closed its Chinese and Japanese programs. The University of Western Sydney has closed its Indonesian programs. The La Trobe and Murdoch universities both announced last year that they would axe their Indonesian programs, but, thankfully, they've had some temporary reprieves. Australian students will be the drivers of Australian trade and exports in the future, particularly the children of the diaspora from these countries.

Professor Ly Tran says:

A critical element in lifting Indo-Pacific knowledge for young Australians is opportunities to engage with and learn about Indo-Pacific cultures and languages at home.

It's short-sighted for the coalition government to neglect universities. It's short-sighted to let key language courses close because of a lack of support during a pandemic. Yet they have given billions and billions of dollars—almost the same amount we have spent in the defence budget—to profitable companies. For international students who come to Australia to learn, guess what? They become our best ambassadors. It's like they're working for DFAT for free on behalf of our nation when they return to their nation. International education brings more to Australia than the $20 billion that the Mitchell institute estimates will be lost if international students do not return for another year.

Prime Minister Morrison should be doing more to support our fourth-largest export industry, instead of waging some sort of crazy cultural war on universities because of something that happened to him when he was studying geography—I don't know! Maybe that's a topic for another speech or perhaps a royal commission under an Albanese government—just kidding! I commend this bill to the House.

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