Extract taken from Chris Bowens book Hearts and Minds: A blueprint for Modern Labor, published July

2013. Section titled: Foreign Investment Creates Jobs and Growth (Pages 68-70) Any discussion about policies for jobs and economic growth wouldn't be complete without an analysis of the importance of foreign investment to the Australian economy. Few issues stir as emotional a response from the Australian people as foreign investment. As Sir Humphrey would say, it is a courageous politician who strongly supports foreign investment in the Australian economy. Tensions particularly rise to the surface when iconic Australian brands such as Arnotts or Dunlop are sold to foreign investors. There is concern that control of the Australian economy and investment are being handed over to foreigners. It is an understandable, but misplaced, concern. A 2008 poll found that 90 per cent of Australians feel that the federal government should make some major Australian companies are kept in Australian hands. More recently, strong community concerns have arisen about foreign investment in Australian agriculture, with concerns that 'selling off the farm' will endanger our food security. Arguably; this concern has been even more heightened by strong growth in foreign investment from China and worries that investment by Chinese state-owned enterprises will be conducted in the best interests of the Chinese government and not-the Australian people. Traditionally, both major political parties have defended and advocated a liberal approach to foreign investment. Despite the obvious temptations of a more populist approach, both parties in government and opposition have recognised that a country with a relatively small population, and thus a small capital base, which has abundant natural resources that are expensive to extract is thirsty for foreign investment. In the early years of our development, it was investment from the United Kingdom that was the key to our growth. Investment from the United States took over in about 2003, and, more latterly, investment from China has become important. You would expect that the Liberal Party, the alleged party of free enterprise, would instinctively be attracted to a very light-touch approach to foreign investment. It was only twenty years ago that John Hewson, in his free market manifesto 'Fightback', proposed the abolition of the Foreign Investment Review Board and the establishment of a completely free-handed approach to foreign investment. Times have changed since the Hewson era. Tony Abbott has said that foreign investment from Chinese state-owned enterprises would 'rarely be in Australia's interest'. Really? On what was that assertion based? The Liberal Party has appealed to popular concern about foreign investment in agricultural land by very significantly reducing the threshold for investments from foreigners that would come under scrutiny from the Foreign Investment Review Board. The Coalition policy wouldn't change the criteria by which a proposed foreign investment would be assessed but would simply mean that many more investments would need to go through the rigmarole of a bureaucratic process before being approved, creating costs to the tax payer and sending a message of disincentive to foreign investors. Something tells me

that Barnaby Joyce and Bill Heffernan more to do with the writing of this policy than did Joe Hockey. It is hardly a policy which fits in neatly with the free-market rhetoric of the Liberal Party. It is right that there is vetting of major foreign-investment proposals to ensure that they are in our national interest. But our inclination should be towards fewer bureaucratic hurdles to the vast bulk of foreign investment, not more. Political parties have a choice: they can lead the debate on foreign investment, or they can follow it. Tony Abbott's Liberal Party has decided to follow it, and Labor must lead it. It is true that foreign companies will not always act in Australia's national interest. Neither will Australian-owned companies. Companies will act in the interests of their shareholders, regardless of whether those shareholders happen to be Australians or foreigners. The food-security debate in Australia is a real one: we do need to have policies that ensure our agricultural sector continues to produce more than enough food for domestic consumption. But foreign investment is a key part of that food-security story. If there is not sufficient domestic capital in the economy to ensure the required investment in agriculture and food production, then it will be foreign investment which ensures food security. All round, foreign investment is a good thing for Australia. There is an obligation for responsible Australian political parties to lead this debate. More transparency around and more data on the level of foreign investment are fine. More bureaucratic roadblocks to investment are not. Australian governments of both persuasions have invested heavily in the advertising of their contentious policies over the last few years. It would be inarguably in the national interest for a Labor government to embark on a significant public advertising campaign to defend foreign investment and promote its benefits, to talk about why foreign investment is necessary for Australia's continued economic growth. Promoting foreign investment to promote growth would be a very Labor thing to do. (Source: Pages 68-70, Hearts & Minds: A blueprint for Modern Labor, Chris Bowen, 2013)