Free trade talks deadlocked over foreign investment restrictions
The Australian | 18 April 2013
Free trade talks deadlocked over foreign investment restrictions
by: Andrew White
TALKS over free trade agreement with China are deadlocked over that country’s insistence on Australia lifting foreign investment restrictions on state owned enterprises from zero to $1 billion, Trade Minister Craig Emerson told the global food forum
Dr Emerson said Chinese political leaders had made the lifting of foreign investment restrictions on state-owned enterprises a non-negotiable condition of any free trade talks.
"We are not in a position to do that,’’ Dr Emerson told the food forum.
Speakers at the forum, including Victorian premier Denis Napthine and Visy executive chairman Anthony Pratt, have told the forum that Australia must conclude a free trade agreement in order to seize the opportunities for Australia’s agriculture and food manufacturing industries presented by the growing demands for food in Asia.
New Zealand has already opened up substantial markets in China through a free trade agreement but after eight years of negotiation Australia is yet to conclude a similar arrangement.
Dr Emerson said he had proposed a mini-package that would allow some improved access without reaching a full agreement. The issue had been raised by China’s political leaders on the recent trade mission to china led by Prime Minister Julia Gillard.
Changes to tax and regulation of the food and agriculture industries has emerged as key issue, with Mr Pratt setting out a six-point plan that included allowing accelerated depreciation of assets for farm industries, the abolition of payroll tax and assistance for research and innovation.
Shadow Minster for Finance Andrew Robb told the conference that the Liberal Party was looking at the issue of accelerated depreciation for farmers.
Mr Pratt and Mr Robb also endorsed a call from the floor of the conference to lift the profile of food and agriculture industries in government by placing portfolio responsibility with the Deputy Prime Minister in the federal government and Deputy Premier at state government level.
But Dr Emerson said the call for an overhaul of anti-dumping regulation to put the onus of proof on the alleged perpetrator should be approached carefully. If Australia wanted to be a major food exporter it had to accept that there would also be food imports.
Major General Michael Jeffrey, the Former Governor General, said Australia also needed to "fix our own back yard’’ by addressing soil degradation and water management as part of its response to the looming food "crisis’’ in the world.
Major General Jeffrey said soil, water and vegetation needed to be declared national assets, science refocused towards the food challenge and farmers be fairly compensated for their output and management of the land.
Kraft Foods Asia Pacific president Rebecca Dee-Bradbury said Australia’s planning for expanded food and agriculture needed to work backwards from what the consumer wanted, rather than from the farm gate outwards.
