Discussion needed on foreign state-owned farm ownership, but perhaps avoid the “hyperbowl”

So the MP With Australia’s Best Interests at Heart, none other than independent Tony Windsor, has thrown his authentic Akubra into the ring and said his two cents about the issue of Chinese state-owned firms buying up Australia’s farms.

“We shouldn’t debate about stopping foreign investment – no one is going to do that – but should foreign governments have freehold ownership over our land?

It’s something we should debate and look at the distinction between state-owned buyers and others.

And a cursory google search finds all sorts of alarming press about the Chinese government investing in and buying huge swathes of our farmland, including the notable ABC special report provocatively entitled, “Selling the Farm to China”.

Foreign interests including state-owned companies from China and the Middle East are increasingly looking to Australia to secure their food production by purchasing key agricultural assets.

The sale of agricultural land is exempt under Foreign Investment Review Board regulations and the FIRB’s attention is usually triggered only by the sale of companies whose assets exceed a $231 million threshold.

And many are right to be concerned about state-run Chinese firms cashing in on Australia’s farms, but is Liberal senator Bill Heffernan (concerned, in the report above) not playing perhaps a bit of politics here?

It would be wise to keep this in a little perspective. Even when investing as little as $1, state-owned enterprises (SOE) have to have approval from the Foreign Investment Review Board (FIRB). Why’s that important? Because most of the investments from China come from SOEs, so that $231 million threshold doesn’t apply, and nor does the exemption for agricultural land.

And this:

ABS released some land ownership data based on a survey of 11,000 agricultural businesses recently and the study found 89pc of the surveyed agricultural land was entirely Australian owned, while 92pc was majority Australian owned.

So not that much land is full or part foreign owned, and most of that has been approved by the FIRB because at least in China’s case, those investments are from the Chinese state so you can’t really go around attacking China on this one.

For sure, we don’t really know exactly how much farmland Chinese SOEs own, and that’s something that should definitely be rectified, but you can be rest assured it’s not that much, most likely nowhere near proportional to the panic generated over it.

If people still want to get worked up, be at some sections of our media, notably one that doesn’t mind the odd bit of exaggeration when it comes to their rural reporting.

Most of us were suckered in to that one for a while.

Let’s hope we’ve learned and don’t get suckered into this one, too.

    • Sean of Deer Park
    • March 13th, 2012

    Hard to say if this is good or bad at this point (available evidence). I’d agree with what you’ve put here, BB. This is an issue that really needs a fine tooth comb run through it to determine the final analysis.

    I have been told, in Queensland for example; farms are being purchased in company names with Australian ownership. Although, on closer inspection the “Australian Company” turns out to be owned by the Chinese government. As you point out, at the moment the figures would indicate a lower percentage of overall land. But without proper checks in place, at what point do we decide it has gone too far.

    A good example might be to look at the Qld sugar cane industry. CSR is no more. Farms have been sold off to foreign investment. It is good the land is still being managed in this way, as it creates local jobs, etc. However, I am told the final product will be restricted for markets offshore (ie. China), because they are the people who own it. That is probably fine for us here today. What about our future?

    Australia’s population today doesn’t reflect the reality of our future. So it seems to me there probably should be some kind of regulation on foreign investment in our farmlands in terms of overseas ownership. It may be simply a matter of guaranteeing a certain percentage of produce to the Australian market at realistic prices (a national right to take back the farm if the Nation is being exploited). Foreign ownership is a privilege, not a right, per se. I don’t know or have the answer but that is the point, isn’t it?

    One thing is certain. You are right to say we need to have the debate and make some decisions to secure the future of all produce and farms in this Country for our own, long term.

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