Andrew Robb (Goldstein, Liberal Party, Minister for Trade and Investment) Share this | Link to this | Hansard source

I am pleased to present and table the inaugural annual Investment Statement to the parliament. This delivers on a commitment the coalition made at the 2013 federal election. It also follows my appointment as Australia's first federal minister for both trade and investment. This highlights the priority the Abbott government has placed on attracting inbound capital to support our nation's continued economic growth.

Since the arrival of the First Fleet, Australia, with its relatively small population, developing economy and thin capital market, has always been reliant on foreign investment. This remains the case today notwithstanding our emergence as the world's 12th largest economy; an economy which has delivered an extraordinary 23 years of uninterrupted economic growth. Foreign investment has been a key element of this success story—driving successive waves of growth this country has enjoyed in gold, wool, agribusiness and mining.

We are of course a resource-rich country. But, in order to exploit this, foreign capital has been required to finance the shortfalls in our own savings and investment to support project construction and ultimately production. Continued waves of investment remain critical as we seek to diversify our economy and to reduce our reliance on any one sector, regardless of how strong.

Foreign investment supports the expansion of our businesses and industries and the creation of jobs and has helped build the enviable standards of living we enjoy today as a nation. It also supports Australia's involvement in global value chains, drives innovation and productivity and helps us remain competitive in increasingly competitive global markets. Put simply, without foreign investment, our productive capacity, employment levels and income would all be significantly lower.

New foreign capital is required to support this government's ambitious infrastructure program and to further develop those areas of our economy that are clear strengths; the things as a country we do as well as any and better than most. These include agriculture and agribusiness; tourism and hospitality; international education; health, ageing and medical research; obviously resources and energy; and all the services, logistics and high-end manufacturing which cluster around these sectors of great strength. These areas already contribute much to our economy but they have great further potential, particularly given the demand from an exploding middle class across the Asia Pacific—with numbers expected to surge from 600 million to around three billion within 20 years. It is almost incomprehensible, the phenomena that is going on in the region around us.

As a consequence, this will be the century of food, water and energy security, and Australia is extremely well positioned to take advantage. Northern Australia can play a major role, but again foreign capital is required to help drive its development. This explains why so much of my attention is dedicated to doing everything I can to promote Australia as an attractive investment destination and to encourage its inward flow.

The world is in fact awash with capital in search of a home, but the economic and geopolitical uncertainty that worries people around the globe has seriously impacted on business confidence in new investment. Risk-taking is much diminished. An investment environment of certainty and stability is more important than ever. This is why the government is determined to do everything reasonably possible to ensure Australia is viewed by the world as a stable, certain, attractive investment destination; as a country that is indeed 'open for business'.

Australia and foreign investment

In 2013 Australia attracted an additional $115 billion of new foreign investment 'direct investment'—that is, investment into business in which a foreign investor had some element of control, by owning 10 per cent or more of the ordinary shares or voting power. The other main part of foreign investment is investment of a portfolio nature, such as diversified investments into equities or long-term bonds by international investors here—and I will come back to this other part of investment in a moment.

Globally, Australia was the ninth largest destination for global foreign direct investment net inflows in 2013—accounting for almost 3.5 per cent of global flows. The largest amounts of new foreign direct investment into Australia in 2013 came from:

Investors from China made new direct investments of $5 billion into Australia in 2013 (up from $3.5 billion in 2012).

The total amount (or stock) of 'direct investment' in Australia reached A$630 billion in 2013—40 per cent higher than in 2008. Traditionally—and still today—the bulk of our stock of direct investment is held by investors from developed countries like the United States, the United Kingdom and Japan. In 2013, the United States was the largest total investor here, holding $149 billion—or nearly a quarter of the stock of all direct investment in Australia. The United Kingdom was second at $87 billion, with nearly 14 per cent of total direct investment. Japan was third at $63 billion, with 10 per cent of the total direct investment. But, increasingly, foreign investment is now coming from emerging markets in Asia. Australia is a leading destination for Chinese investment, for example. China is now our sixth-largest source of inward foreign direct investment, holding three per cent of the total stock, with A$21 billion. China's surge is set to continue.

In addition to all this foreign direct investment, there is an additional $1.4 trillion of 'portfolio investment' in Australia—highlighting the attractiveness of Australia to international fund managers—plus other forms of investment (such as loans, bank deposits and trade credits), for a grand total of foreign investment in Australia in 2013 of $2.5 trillion.

Foreign investment and jobs

For Australia, direct foreign investment means more jobs. One in five businesses in Australia with more than 200 employees are at least 50 per cent foreign owned. And foreign investors often deliver high-quality jobs. US majority owned affiliates in Australia, for example, pay wages well in excess of the average wage. According to a database of announced foreign direct investment transactions published by The Financial Times, in the five years to July, there were 1,635 investment projects in Australia. These attracted US$100 billion in capital expenditure and generated over 140,000 jobs.

The economic reform agenda—supporting investment

As mentioned earlier, this government is committed to attracting more foreign investment. This explains our aggressive domestic reform agenda, which is aimed at improving Australia's 'ease of doing business'. We are working to restore Australia's reputational 'gold standard', which sadly slipped under our predecessors. We are removing the damaging taxes—the carbon tax and the mining tax have been repealed. I know that these measures alone have dramatically improved our standing among serious international investors.

We are committed to a serious attack on red and green tape to the value of $1 billion each year. Already, through our first repeal day in March, we cut more than 10,000 pieces of regulation and legislation and more than 50,000 pages were deleted from the statute book. This will save over $700 million in compliance costs across the economy every year. More will be on its way in the next repeal day in October.

We are also streamlining approval processes for major projects through the 'one-stop shop' initiative. This will reduce duplication between states, territories and the Commonwealth and save time, which is money for businesses and investors. The time for a large $30 billion LNG project approval, for instance, has drifted out by up to two years since 2007, and at a cost of $30 million to $40 million a month that puts a huge millstone around the neck of our competitiveness for a resource which is going to be in huge demand in the years ahead. The environment minister has already, in a most responsible way, approved in the order of 300 projects, including 94 in resources, worth $800 billion in economic value—some of which had stalled for six years under our predecessors.

We are also committed to restoring the rule of law in the construction industry to stamp out rogue union behaviour, which undermines investment and productivity. The last time that we introduced a building and construction commission we saw a $7 billion increase in productivity. We are investing a record $50 billion in infrastructure, which will help leverage $125 billion worth of projects, including road and rail. And we are driving an innovative asset recycling program with incentives for the states and territories to privatise assets and infrastructure. Again, this has captured the imagination of international investors, including, for example, the major pension funds of Canada and the big investment houses in New York.

In the free trade agreements we have recently concluded with Korea and Japan, we have also dramatically increased the private investment screening threshold to $1.078 billion, the same level that applies to the United States and New Zealand. This is the non-discriminatory approach we are looking to take in future trade agreements which reduces the regulatory burden for investors.

We are also committed to major reviews of competition policy and the taxation policy through a comprehensive tax white paper process. Already, the government's pro-investment approach is having a material impact. The Chair of China Merchants Group, Liming Yu, wrote to me advising of the company's $1.75 billion investment with Hastings in the Port of Newcastle. He wrote:

One of the key factors that gave us confidence in making such a significant investment in Australia is the proactive approach your ministry has taken in attracting foreign investments and your commitment of providing an open, fair and level playing field for all the investors to invest in Australia.

He went on:

I strongly believe that with such an open, transparent and pragmatic approach to investment and business under your ministry, there will be more larger investments occur in Australia.

Likewise, the chairman of China's powerful National Development and Reform Commission (NDRC) told the Treasurer and me during a visit in June that Australia's investment environment had improved a great deal over the last 12 months. He also praised the coalition for its decisions to repeal both the carbon tax and the mining tax.

As mentioned, we have also sent a strong signal in regard to our support for the development of northern Australia, with a white paper being advanced. I have made no secret of my belief that there are massive significant untapped opportunities waiting for us in northern Australia. But, if we are to win the capital that will unlock the North, we must have a regulatory framework that is attractive to and reliable for business. Next year I will host a major forum in the North for some of the world's biggest investors to showcase the opportunity and investment-ready projects. Infrastructure requirements will be a major focus.

Investment has also been identified as one of the four key pillars of our recently outlined Economic Diplomacy program.

We are taking a true 'Team Australia' approach working hand in hand with state and territory governments to attract investment.

In February of this year, I chaired the inaugural meeting of Commonwealth and state and territory trade and investment ministers and in September I chaired the second meeting in Cairns.

Together we identified national investment priorities which align with the strengths I mentioned earlier.

These include:

In addition, I am appointing five senior investment specialists to work with Austrade to identify inward investment opportunities and to help realise them across these five areas. Four of those specialists have already started work.

In tourism, we have major prospects ahead.

With the rise of the Asian middle class, tourism will be a major driver of growth.

By 2020, almost 200 million Chinese tourists are expected to travel internationally, a doubling of current numbers in just the next five years.

Australia is well placed to capitalise on this rising demand.

But we need significant investment in tourism infrastructure if we are to realise our potential in that market. That huge potential lies particularly at the high-value, high-margin end. We are a high-cost country and in order to get a return that warrants the investment, we need to pitch so much of what we do, including in tourism, at the high-value end.

We require something like 20,000 new and upgraded rooms.

Funds are already starting to flow.

There are reports of $20 billion in prospective investment in high-quality Australian tourism infrastructure, which includes five-star integrated resorts near Cairns, in Brisbane and also on the Gold Coast.

Hong Kong-listed Far East Consortium International was recently announced as the successful bidder for the Elizabeth Quay Lot 9 & 10 project in Western Australia.

Construction is valued at more than $350 million—and something like 1,000 jobs will be created.

In agribusiness, Australia is exceptionally well placed to help meet Asia's massive, emerging demand for safe, premium food and fibre—again, at the premium end of the market.

ANZ estimates we stand to capture up to $1.7 trillion in 2011 dollars in new agricultural exports out to 2050.

But we will need investment, including foreign investment, to make this happen. And it is happening.

Just last week, I witnessed a signing ceremony held for the establishment of the Beijing Australia Agricultural Resource Cooperative Development Fund.

The fund is planning to invest around $3 billion in capital in various Australian agricultural projects, including in dairy, particularly infant formula, and in beef, lamb, seafood and other products. This has followed some eight meetings I have had with the companies involved over nine months.

In another example, Italian chocolatier Ferrero recently made an A$70 million investment to set up a hazelnut plantation of one million trees on 2,000 hectares in the Riverina region in NSW. This spread of investment type is exceptional and presents enormous opportunities. Invariably all of this new investment brings different perspectives and invariably a lot of IP, which again we share in. It makes our work force more skilful and makes our ventures more innovative, and it keeps us at the forefront of trade and investment.

In resources and energy, we know Australia's prospects remain bright, particularly in areas like LNG.

There are major new projects that offer 25- to 50-year lifespans, in oil, gas and mining.

The recent approval of Adani Mining's Carmichael coal mine and rail infrastructure project in Queensland offers something like 2,500 construction-phase jobs. It will open up the Galilee Basin, which has been spoken about for 40 years. It is the first new province for coal development in 40 years.

And 4,000 ongoing operations positions will be part of that project.

The project has a resource value of $300 billion over 60 years.

By the way, that project will provide electricity for 100 million Indians for 90 years, so we are providing a humanitarian outcome as well as a commercial outcome for Australia.

Equally, we are keen to draw investment into our advanced manufacturing and services sectors.

So we can continue to develop great Australian products that have global significance—like penicillin, the bionic ear, wi-fi, the cervical cancer vaccine Gardasil, and so on.

The proposed $20 billion health endowment fund for future medical research and development is prompting major international investment interest.

Boeing's investment in a new R&D facility in Port Melbourne, Victoria, is a great example of how Australian R&D capability is attracting the attention of major multinationals.

And in infrastructure, we simply do not have enough capital to fund all the projects that we need to truly link Australia to the world, to tap into global best practice and maximise our economic growth.

According to the Business Council of Australia, we have an infrastructure need of more than $760 billion. That sort of funding simply cannot be obtained locally.

The A$1.5 billion Legacy Way Project in Brisbane is a great example of foreign investors partnering with a local firm to reduce costs and introduce innovation in the development of Australian infrastructure.

Austrade is at the forefront of our efforts to attract new investment.

For the fiscal year 2013-14, Austrade supported a total of 72 investment projects with an estimated total value of $2.7 billion.

These projects are expected to create over 4,440 jobs once fully operational and lead to further export potential.

In the nine months to 30 June 2014 the government, through the Foreign Investment Review Board, approved around 770 proposals valued at around $110 billion in (non-residential real estate) foreign investment projects.

In my role I travel frequently and use all visits abroad as opportunities to promote Australia to major investors.

Since coming to office, I have conducted 40 major investment roundtables in 16 countries, including most recently in India.

For example, one roundtable in the United States had five investment funds representing well over $1 trillion in funds under management. I had two hours to sell Australia to investors who had never had any contact with Australian governments in the past.

Likewise, in Canada, I had a roundtable with major pension funds representing nearly $500 billion.

And I have received strong interest in Australia from around the globe, particularly out of financial centres in Asia.

During Australia Week in China earlier this year MOUs worth around $900 million were signed.

And as a direct result of a tourism infrastructure roundtable which I chaired during Australia Week in China, the Wanda Group recently announced a $900 million investment in tourism-related infrastructure on the Gold Coast.

Recently I hosted an Australian Investment Forum on the sidelines of the G20 trade ministers meeting in Sydney, which brought together 100 of the most senior representatives of current and future foreign investment in Australia. Many of the members had attended the B20 meetings in the previous two days.

During this, Chinese property giant Greenland confirmed that on account of the improving investment environment in Australia it was planning up to $4 billion of additional investment in tourism, infrastructure and agriculture in addition to $1.5 billion of existing investment.

Conclusion

In concluding, the Abbott government unequivocally welcomes foreign investment.

Attracting foreign investment is vital if we are to maintain sustainable economic growth and to create sustainable additional jobs.

But there is great competition globally in obtaining the capital. We need to develop the Australian economy of the 21st century.

But we have advantages we are determined to leverage.

We have strong economic fundamentals.

We have some great sectors of strength that offer enormous opportunity, and greatly complement the emerging economies around us.

We have a highly skilled, knowledge-based work force. And we have a pro-investment government, with policies designed to restore our gold standard.

I look forward to updating the parliament next year on our efforts and achievements over the coming 12 months.

I ask leave of the House to move a motion to enable the member for Rankin to speak for 22 minutes.

Leave granted.

I move:

That so much of the standing and sessional orders be suspended as would prevent the member for Rankin speaking in reply to the minister's statement for a period not exceeding 22 minutes.

Question agreed to.

Jim Chalmers (Rankin, Australian Labor Party, Shadow Parliamentary Secretary to the Leader of the Opposition) Share this | Link to this | Hansard source

Labor supports foreign investment. We see foreign investment as one way to create the jobs and to create the opportunities that might not otherwise be created or be made available in our economy. Our engagement with the world has made Australia a more competitive, a more productive and a more prosperous nation. As others have said, including the Minister for Trade and Investment today, we are a capital-hungry country and there is a lot of capital looking for a home around the world. We do not have in Australia sufficient capital to maintain the sort of employment opportunities and living standards that Australians have a right to expect and that Australians deserve.

The benefits of an open market have flowed to everyday Australians through lower consumer prices and increased employment opportunities. Labor knows that we will not improve living standards and opportunities for working people by pulling down the shutters on the world, so we do support foreign investment. Subject to the right arrangements and subject to the right protections, we do want a more open Australian economy. We are the ones who believe very deeply that it is possible to combine economic expansion and Asian integration and opportunities for a greater number of Australians here at home. This is effectively the Keating model that so many of us on this side of the House see as an article of faith. Some of us joined the Labor Party to advance the cause of, for example, Asian integration and a more open economy and to do so in a way that gives our people more opportunities to prosper.

Labor does have a really proud record when it comes to investment. Contrary to a lot of the commentary that you hear from the government's cheerleaders, there was an investment boom under the Labor government despite a global financial crisis. In the minister's own statement, he refers to a really stunning statistic—and I do congratulate him for informing the House of this statistic, because it is important. Between 2008 and 2013—so for the period of the former Labor government—there was an investment boom. Foreign direct investment was up 40 per cent over that period, which is an extraordinary amount of growth and something that we are very proud of on this side of the House. I think the whole nation should be proud of the way that Australia has attracted that level of foreign investment. Unfortunately, for the government and for the minister, it undermines the rest of his argument that Labor was in some way an impediment to this kind of investment. There was an investment boom under Labor. His own speech refers to 40 per cent growth in foreign direct investment under Rudd and Gillard. It is extraordinary that he would then go on to make his partisan points about Labor, having already quoted the key statistic.

I am proud in my own personal sense to have been involved in some of these foreign investment decisions in a former role working with the member for Lilley, the member for McMahon and the member for Maribyrnong—the Treasurer and various Assistant Treasurers over that period. I was proud that we took such a pro-investment stance when it came to many of the applications that came before us as a government. So I do thank the minister for mentioning that crucial stat about the growth in foreign direct investment under the former Labor government.

Of course I do not have time to go through it in detail here, but the Asian century white paper was also geared towards how we would become a more attractive destination for investment here in Australia, in the most dynamic region in the global economy, which is, of course, Asia. How do we attract investment from these countries that are becoming not just big exporters of capital but also big consumers so that we have this virtuous cycle of investment and trade in our region.

It was also good of the minister to mention 23 years of consecutive economic growth in Australia. That is almost a quarter-century of economic growth and continuous expansion in the Australian economy—every Australian should be proud of that fact—with half of it under us and half of it under our opponents across the table here. It is worth mentioning that whenever we think of that quarter-century of continuous economic expansion in our economy, we should pay tribute again to the reforms put in place by the Keating and Hawke governments and also by the efforts that all Australians put in, including the government, in saving Australia from the global recession. Without the Keating reforms, without the stimulus and all the other factors that helped us over that difficult period in the global economy, those 23 years—entering 24 now—would not have been possible. So I think that, with our credentials as attractors of foreign investment and our economic record, we do come to this conversation with some credibility.

We also take a national interest approach to these questions. It is the only way to go. It is no use conducting these debates in an overly partisan way. It is of course our responsibility to highlight the flaws in each other's arguments. But this is after all about Australian prosperity, and we should always take a national interest approach to these sorts of questions. I think it is wonderful to hear from the minister for trade, for example, about the success that he might have in some of these forums. We support him touting Australia's wares around the world; that is the job of a trade and investment minister. As patriots first and partisans second we do want Australia to succeed in the global economy. We do want to have that success. We do want to have that prosperity. We do want to create jobs. So, where we can, we support the government. So we do not disagree with everything the minister said; we disagree with parts of what the minister said.

One of things we do disagree on is that we believe being 'open for business' should be more than just hanging a sign on a lectern. We need to be serious about it. You are not serious about it if you are hopelessly split as a party on decisions like the GrainCorp decision, which was a shocking decision for Australia. There was not a single mention of it in the minister's statement. When I was flicking through the minister's statement, I thought that a page had dropped out because there was nothing in there about GrainCorp, which was the most significant and detrimental decision that the government has taken when it comes to foreign investment, and I want to go through that in detail in a moment.

You are not serious about foreign investment if you have members like the member for Higgins denigrating the Foreign Investment Review Board, in the Treasurer's portfolio. I thought that they were disgraceful multiple interventions from the member for Higgins when she was running down Brian Wilson, who is a top servant of Australia, who runs the Foreign Investment Review Board, in the Treasurer's portfolio—not a peep from the Treasurer to defend his own Foreign Investment Review Board. You are not serious about foreign investment if you attack the confidence that overseas investors might have in that body. You can say what you want about their resourcing, you can even say what you want about their decisions, but for the member for Higgins to get into Brian Wilson about a lack of leadership, I think, sends the wrong message to the rest of the world. It would not surprise me entirely of some members opposite agreed with me. I would hope that the Treasurer would agree with me, given that the FIRB is in his own portfolio.

You are not serious about foreign direct investment if you have two views on agriculture, and we know that those opposite have very different views in terms of the threshold for—

Michael McCormack (Riverina, National Party, Parliamentary Secretary to the Minister for Finance) Share this | Link to this | Hansard source

You've got no views on agriculture—

Jim Chalmers (Rankin, Australian Labor Party, Shadow Parliamentary Secretary to the Leader of the Opposition) Share this | Link to this | Hansard source

I will run through them in a minute if you like. We have outlined our position on agriculture. They have outlined two positions on agriculture.

You are not serious about foreign investment if you play around with the renewable energy target like those opposite are. You are not serious about the billions of dollars that should flow into our renewable energy sector if you have ministers saying one thing, including here, and other ministers saying another. You need to be sending a signal to those who want to invest in renewable energy that we are fair dinkum about renewable energy.

With regard to what we heard from the Minister for Trade and Investment today, as I said before, there were some things we agree with and some things that we disagree with. We think that the most important thing that you need to contemplate when you are talking about being 'open for business' is not just the rhetoric, as important as that can be in some of these international fora, but also the decisions made, and I do want to spend some time on the inconsistency of those opposite when it comes to foreign investment.

The Abbott government failed its first test on foreign investment when it blocked the proposed takeover of GrainCorp by Archer Daniels Midland. Not only did the government block the takeover but it has been completely inconsistent in its reasons for doing so, showing that it is making up investment policy on the run. It is noteworthy that the minister mentioned the First Fleet in his statement but not the Treasury decision on that foreign investment proposal.

In April this year, the Treasurer claimed that he had blocked ADM's proposed takeover of GrainCorp because the American company was of 'not particularly good character'. The Treasurer's extraordinary claim was made public five months after blocking the ADM investment and raises serious questions about the transparency and fairness of the government's approach to foreign investment. This sorry saga of confusion and contradiction on ADM's proposed $3.4 billion investment gives the lie to the government's claim that Australia is open for business. The Treasurer and the Minister for Trade and Investment have made a series of inconsistent statements about ADM's proposed acquisition of GrainCorp. When the Treasurer announced he was blocking the deal last November, he cited national interest grounds and the impact on competition and made no mention whatsoever of the character grounds that he has since talked about. Then, in March this year, the Minister for Trade and Investment told an investor conference the decision to block the takeover was just a signal that the deal's timing was wrong and that 'there may be an opportunity at some stage' for ADM to renew its bid for GrainCorp. A month later, the Treasurer made a new claim when he said that one of the reasons it was knocked back was concern about the company's character. Given this claim was made so long after the decision to knock it back, we do wonder whether ADM was given the opportunity to respond.

If the Abbott government wants to show some leadership and find some consistency on foreign investment, it could start by providing a coherent explanation for that particular shambles. As the BCA's chief executive, Jennifer Westacott, said at the time of the ADM decision, certainty about Australia's foreign investment policy and transparency in communicating the reasons for decisions are important for global confidence in Australia. Inconsistent and incoherent behaviour by the government on major investment proposals will erode Australia's reputation as an investment destination, which will be bad news for jobs and growth.

In addition to the Treasurer's retrograde decision against ADM, we also have the tail wagging the dog inside the coalition party room, with the imposition of new and arbitrary limits on investments in agricultural land. The minister talks big when he is on the phone to financial journalists, but he cannot stare down the Nats in his own joint party room.

In a speech to the Economic and Social Outlook Conference in Melbourne in July, Labor's shadow minister for trade and investment, Senator Penny Wong, outlined Labor's ambitious approach to lifting the thresholds on foreign investment. Australia has always built its economy with investment funded by a mixture of domestic and overseas capital. We agree, as I said before, with the minister that our economy is capital hungry and it does rely on foreign investment to create jobs and business opportunities and to boost growth. As part of a comprehensive agreement delivering real market access gains and dealing responsibly with the labour movement, Labor is inclined to support China enjoying the same investment thresholds as the United States. That means a threshold of just over a billion dollars for Foreign Investment Review Board screening of proposed investments in non-sensitive sectors. Lower thresholds should continue to apply for investments in sensitive sectors or by state owned enterprises where issues of national interest can arise. The proposed treatment of state owned enterprises must be outlined by the minister before any agreement is signed.

Labor does not agree with the Abbott government's policy of imposing more restrictive rules on foreign investment in agriculture. As Penny Wong has said:

If we are serious about significantly expanding our food exports to Asia, we must front up to the reality and necessity of foreign investment in our agricultural sector.

It is inconceivable that we will be able to scale up production to fully tap into the growing consumer markets of Asia without foreign investment.

Placing hurdles in the way of foreign investment in our primary production industries will only jeopardise their growth.

That is why Chinese investment in agriculture should be treated in the same way as investment in other non-sensitive sectors.

Looking further ahead, once Australia has a $1 billion-plus threshold for FIRB screening for investors from the United States, Korea, China and New Zealand, it is hard to see why we should discriminate against other major trading partners.

Minister Robb has also cited the increased threshold for these countries in his statement, but Labor believes that Australia should consider unilaterally extending the FIRB screening rules offered to these FTA partners to all countries. Just like domestic investments, foreign investment proposals would still need approval from competition and corporate regulators to maintain competitive markets and protect shareholder interests, and for proposals worth more than $1 billion, the government would retain its powers to scrutinise investments on national interest grounds. But for a country that thrives on investment, it makes no sense to impose unnecessary red tape or barriers to investors looking to build businesses and create jobs legitimately in Australia.

Labor has a proud record when it comes to foreign investment. We in Labor understand that foreign investment means growth and jobs when it comes to broader measures to open up our economy. Over the years, Labor trade ministers from John Dawkins and Peter Cook to Simon Crean and my own predecessor Craig Emerson have played important roles in dismantling protectionist barriers. Labor wants to see more opening up of our economy on a wider range of fronts, with deeper integration into our region and into the world, because this will deliver growth for Australia and will improve living standards for working people. If Australian policy makers handle this shift intelligently they will deliver great economic benefits for future Australian generations.

The Gillard government's Asian century white paper set the goal of ensuring that Australia's economy becomes more integrated with Asia, with goods and services, capital, ideas and people flowing more readily between Australia and the economies of our region. If this can be achieved there will be tremendous opportunities for Australian businesses and investors in countries like China and India. But it will not just happen by itself. It will require getting a raft of policies right, not just in trade but also in industry and innovation, education and science, investment and infrastructure. Unfortunately, in so many of these areas billions of dollars have been cut from investment right across the board. To be serious about boosting Australia's trade performance, it is necessary to be serious about boosting productivity and competitiveness. Declaring that Australia is open for business requires more than signage on a lectern. We need continuing economic reform.

Labor wants an innovative, competitive, dynamic and outward-looking Australian economy. We want to think more broadly about the kind of country that other companies around the world would want to invest in. The minister outlined some of those factors that companies around the world take into account. We think that that shopping list of policy measures was characteristically narrow and exclusive and an excuse to pursue some pet ideologies. To give a speech about investment and not to mention superannuation, to be the minister for investment and not talk up super in our economy, is bizarre in the extreme. Anyone who knows anything about this sort of stuff knows that that combination of foreign and domestic investment—that capital—comes not only from overseas but also from our own super funds and other sources. I think if we are going to have a minister for investment he should understand and should value and should treasure the role of superannuation in our economy, including the role of superannuation in helping Australia get through the global financial crisis.

The other thing we want to hear from the government is that a lot of companies around the world want to invest in a country where the people are smart and well trained and where there has been substantial, proper investment in the human capital of a nation. To be attracted to Australia, people want to know that they are investing in a country full of dynamic, adaptive and resilient people. That goes to some of the unfortunate, disappointing and devastating reforms to the higher education system proposed by the Minister for Education which will price some people out of the market. Those opposite do not have a great understanding of people who are vulnerable in our community. Some people will finish high school and they will think about higher education, but they will decide against it on the basis that they do not want to owe Chris Pyne $100,000, they do not want to take all their life to pay back that money and they do not want to choose between a higher education—a degree—and buying a house or starting a family. The massive majority of the Australian people are with Labor on that issue.

Mr Tudge interjecting—

No, they did not. When we talk about team Australia, its membership should be broad. What I mean is that when we are talking about foreign investment we need to make people understand that foreign investment is a big opportunity for Australia and that its benefits need to be more broadly felt. We need more people to be able to grasp the benefits of prosperity in our country. That means we need to do a better job—all sides of politics, anyone involved in the public conversation—of explaining to the Australian people the benefits of foreign investment and the benefits of opening up our economy so that those who adopt a reflexively defensive position do not dominate the debate. I think probably we could agree, and I am sure the minister would agree, that it needs constant effort on both sides of politics and all parts of the country to consistently sell the benefits of that effort if you do believe in foreign investment and in opening up the economy.

The minister mentioned before the global value chains that are dominating the trade structure of the global economy right now, particularly in our own region. When we talk about foreign investment and trade we want to make sure that we are training our people for the best parts of those global value chains. We want to be at the good end; we want to be at the high-wage, high-skill end of those global value chains. I think that is a worthy aspiration for a First World, first-rate country like ours. We cannot compete with other countries on wages. We cannot win a race to the bottom. So it is important that we are training our people up for the best parts of those global value chains.

In finishing up my response to the Minister for Trade and Investment, I will say that we do agree with the government on the tremendous opportunities available to Australia out of foreign investment and trade. We welcome the opportunity to engage on these issues, and we thank the minister for the opportunity to respond.