Max O.
Foreign investment has played the dominant role in the capitalist development of Australia since the First Fleet arrived in Sydney in 1788.
Presently the United States and Britain account for over half of all foreign investment coming into Australia. The other half comes from European, Asian countries such as Japan and Singapore, followed by China and India bringing up the rear of the investors pack.
Recently there has been considerable rancor by the likes of Barnaby Joyce (Queensland National Party senator) and Bill Heffernan (NSW Liberal Party senator) that Australia’s ability to feed itself could be threatened by government owned firms, in particular Chinese, buying out our agricultural land and agribusinesses. Mark Arbib, Australian Assistant Treasurer, is more sanguine about the matter. He argues: “that if you cut foreign investment into agriculture… You'll cut jobs, you'll cut production, and you'll threaten food security in Australia.”
Foreign ownership figures
The recent Australian Bureau of Agricultural and Resource Economics and Sciences report stated that 44 million hectares of agricultural land are now wholly or partly owned by foreign entities. That is a 60% increase from the 28 million hectares since the 1980s. However, the Australian Bureau of Statistics undertook a survey in 2011, called the Agriculture Land and Water Ownership (ALWOS). The results of the survey showed that as of 31 December 2010: 99% of the 133, 600 agricultural businesses in Australia were entirely Australian owned; 89% of the 353 million hectares of agricultural land were entirely Australian owned; and 91% of water entitlements for agricultural purposes were entirely Australian owned.
However, John Cobb, Federal Opposition's shadow Agriculture and Food Security Minister points out: “It doesn’t show what the value of land as compared to what it was once. It doesn’t show whether what areas of production are involved. It doesn’t even say where the land is.” He counters the argument of the 99% of agri-businesses are wholly owned by Australians with: “That totally ignores the fact the bigger ones aren’t. That is the number of businesses. You have a hundred businesses, and three of them are half the total business and they’re owned by foreigners, that’s like saying only three out of a hundred are owned, even though it’s half of all the business. The big sugar companies are all owned by Singaporeans. The milk processors are owned almost totally by the Japanese. It’s ignoring the size and the turnover of the businesses involved.”
With China stepping up its purchases of prime agricultural land, an increasing number of reactionaries aligned with Western Imperialism, in particular the National Farmers Federation and Liberal/ National parties, are essentially worried that if too much of the farm is being sold to China and this could well compromise Australia’s relationship with its major ally, the United States. Consequently the Liberal/National coalition is pushing for foreign investors seeking ownership of Australian farm land be subject to a review by the Foreign Investment Review Board for purchases of $15 million or above, a substantial reduction from the current $244 million threshold. In their recently released Discussion Paper on Foreign Investment in Australia, they also proposed a compulsory review for all overseas investments in the agribusiness sector above $53 million – or more than a 15% stake of agribusinesses valued above $244 million.
Feeling jittery about the issue, a Labor Party working group is examining the need for a national register of foreign owned land and agribusinesses. Although not all rural sectors are worried; The Pastoralists and Graziers Association is happy with the current system, and present thresholds could remain, or possibly be halved to just over $100 million.
The
Liberal/National coalition are not ardent nationalists about foreign ownership and quickly state that in the words of Bill Heffernan: “Obviously, the world in recent times has relied on foreign investment. Historically, foreign investment in agriculture’s been a good thing for Australia, because they come in, spend their money, build infrastructure, go home with their tail between their legs because the difficulty of farming, as any family farmer will tell you, is the vagary of the weather and the market.” As long as it’s not China, the United States economic rival!
Profit maximization
What both major parliamentary parties ignore is the economic issue of super-profits being extracted out of peripheral countries like Australia by multinational corporations. This exploitation by monopoly capitalism has decimated local agricultural industries, whereby imperialist grip on our economy has increased. Much of the huge profits garnered from Australian agriculture are siphoned off to the imperialist heartland (United States, Europe and Japan) via multinational corporations. This dominance keeps a wary eye on potential competitors and attempts to restrict their influence. Hence the hue and cry about Chinese state enterprises investing in Australian agriculture!
As much as we are told that Australia needs foreign investment, the fact of the matter is that we could quite easily survive without it! For example Australian superannuation funds are stated to be worth $1.3 trillion. Combine this with what Australians have saved away in our banking system; there is plenty of capital that could be invested in both local agricultural and manufacturing sectors. Unfortunately it is quite often placed in the hands of foreign financial corporations and invested elsewhere overseas for profit maximisation. They in fact use other peoples’ money and receive most of the financial benefit!
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