Paul Fletcher (Bradfield, Liberal Party) Share this | Link to this | Hansard source

Last week I held a community meeting in my electorate and one of the issues that was raised by a number of people present was concern about the purchase by Chinese interests of agricultural land, particularly for mining purposes. We had a good discussion at that meeting and a range of views were expressed, including a number of people highlighting the importance to Australia of foreign investment. This issue has been getting a lot of scrutiny recently. I want to make three key points in the brief time available: first, to welcome some of the additional scrutiny; second, to make a key point about the two issues involved, on the one hand foreign ownership and on the other hand the impact of mining on agricultural land; third, to highlight the importance of foreign investment.

Let me start by saying that I welcome the fact that there are a range of processes underway to give greater policy scrutiny to these questions, including the fact that the coalition has established a working group to deal with this issue. I want to make the point that there are two conceptually separate issues that can sometimes get bundled together as the one issue. The first issue is the general question of foreign ownership of Australian assets, including agricultural land amongst a range of other assets based or located in Australia. That is one issue. The second issue, which is a conceptually distinct issue, is the impact of mining on agricultural land. A range of concerns have been expressed about this issue by residents of affected communities and this is an issue which is, as are many others, always susceptible to further investigation. I think it is important that we do not automatically conflate the two issues and assume that the central question, in thinking about the impact of mining on agricultural land, is the ownership of the mining company. It seems to me that the central question is the trade-off between the competing uses of land. As I have indicated, I certainly welcome the fact there is scrutiny of both sets of issues. Once that process has been worked through, no doubt there will be some recommendations to consider.

My final point is to highlight the importance of foreign investment in the Australian economy and to note, therefore, that it is a factor we should pay very careful regard to as we think about the question of foreign ownership of any kind of asset, including Australian agricultural assets. Australia is a net importer of capital. In the March quarter of 2011, net inflow was $780 billion. Outflows of capital were $1.24 trillion; inflows were $2.02 trillion—in other words, a lot more money came in than went out. It is, I think, quite self-evident, when you look at the Australian economy and the prosperity we enjoy, that a significant contributor to that prosperity has been foreign investment.

It is also worth making the point that that foreign investment comes from a wide range of countries. In 2009, the stock of total foreign investment was $3,200 billion. Of that, 27 per cent was from the US, 26 per cent was from the UK and the third biggest source was Japan at 5.4 per cent. Total inflows of foreign investment in the year 2009 were $160 billion and, of that, $94 billion came from the US and $34 billion came from the UK. So the Australian economy has always depended very heavily on the inflow of foreign capital. The prosperity of Australia and its people is heavily dependent, I would argue, upon continuing to have a set of policies and a set of frameworks which are attractive to foreign capital. We are competing with many other countries around the world for investment and that is a factor that we need bear mind as we weigh up all the considerations in this set of issues I have raised—a set of issues which is attracting continuing public scrutiny and on which there is, properly, policy scrutiny. We must bear in mind, I would argue, the importance of foreign investment to Australia's prosperity.