Amanda Stoker (Queensland, Liberal Party, Assistant Minister to the Attorney-General) Share this | Hansard source

I might take a few moments to respond to some of the matters raised in the contribution just made by Senator Cox, who I welcome to the chamber, having seen her sworn in today. EFA's equity powers will be focused on overseas infrastructure development and export linked Australian businesses and sectors of economic significance. That includes, for instance, critical minerals. EFA assesses requests for its financing support on a case-by-case basis consistent with its mandate to support Australian export related businesses and overseas infrastructure development that delivers benefits for Australia. As a key export industry for Australia, EFA offers support to the fossil fuel sector, including small and medium-sized enterprises that are involved in supply chains.

EFA investments are carefully screened. There are robust due diligence processes in place that assess any financial, social, environmental or other risks. There's a range of policies, rules and guidance that impact upon EFA's ability to finance fossil fuels. They are in various places, including in the statement of expectations that is issued by the Minister for Trade, Tourism and Investment, the OECD rules and the Equator Principles.

The minister's statement of expectations for EFA sets out criteria that all resource related projects, including fossil fuels, must meet to qualify for financing, and those are: (1) there is a demonstrated market gap in the availability of finance; (2) the transaction doesn't come at the expense of SME transactions; (3) the project has significant Australian content, including through SME supply chain participation and/or benefit; and (4) that the project is commercially viable.

The government also requires EFA to align its environmental policies with several internationally recognised environmental and social standards, including the International Finance Corporation's performance standards, which set out a process for assessing project related greenhouse gas emissions; and the Equator Principles, a risk management framework adopted by financial institutions for determining, assessing and managing environmental and social risk in projects. And these policies and practices will also apply to the EFA's use of its equity power.

In closing, it's also worth noting that EFA is increasing its investments in the renewable energy sector. For example, EFA recently provided a $41 million loan to facilitate the development of three onshore wind farms in Vietnam. I think all of those matters go really to the essence of the concern that is expressed in this amendment and demonstrate substantially why it's not required.