The NFF supports foreign investment and recognises how crucial it is in improving the efficiency and competitiveness of Australian agriculture for a more robust and prosperous industry.
Foreign investment is a topic of debate never far from the surface in agriculture, particularly in recent years as global market opportunities and demand for premium food and fibre products has surged. It can be a delicate argument.
But foreign investment, if supported by thorough and fair legislation, should be seized as fuel to further stoke the Australian agriculture fire.
Foreign investment provides industry with direct investment and immediate capital to support a vibrant agricultural supply chain. To date, the impact of foreign funds has been overwhelmingly positive for Australian farmers and for our rural and regional communities.
It has delivered large amounts of capital at times when finance from banks has been difficult to source and allowed the industry to compete in what is a highly distorted global marketplace for agricultural commodities.
The finalisation of a number of key Free Trade Agreements (FTAs) has further heightened overseas interest in the Australian agriculture sector – never before has the world so well understood of our ability to produce food and fibre of unrivalled safety and quality.
The Foreign Investment Review Board (FIRB) is responsible for assessing if proposals for foreign investment into specific assets is in the best interest of the Australian agriculture sector. The NFF welcomed recent amendments to the Foreign Acquisitions and Takeovers Act 1975 which placed requirements on the FIRB to more stringently evaluate incoming investments.
These amendments included the decreases of the screening threshold for proposed investments for agricultural land from $250 million to $15 million for agricultural land and $55 million for agribusiness and the NFF is pleased this will help ensure thorough consideration is given to foreign ownership in the sector.
Additionally, the FIRB has been provided with resources to assess foreign investment through the implementation of a capped cost-recovery model when foreign investments are screened. However, the NFF most certainly does not advocate the unbridled and wholesale sell off of our farmland.
Revelations the Agricultural Land Register would not be made fully public, but aggregated data would be made intermittently, available came as a major disappointment to industry. Whilst it is understood there are commercial sensitivities that need to be respected, it is also important as much information as possible is available to provide baseline data for debate and well-informed decision making.
What the industry needs
- Ensure foreign investors adhere to Australian law, especially tax and competition law, and enforce compliance with existing and new industry production and/or transaction levies.
- Harmonise the legislated timeframes for assessing foreign investment with other regulatory timeframes, including ACCC mergers and acquisitions impact assessment
- Attract future foreign investment by creating clarity in the FIRB approval process for foreign investors and by maintaining an active FIRB presence overseas
- Redefine agribusiness to only include businesses that have at least 50 percent of their total gross earning (currently 25 per cent).