ALP says ADM-GrainCorp decision was wrong

Written By Unknown on Rabu, 04 Desember 2013 | 12.21

THE federal opposition has stepped up its attack on the government's rejection of a foreign takeover of grain handling company GrainCorp, saying the national interest test was not applied properly.

Treasurer Joe Hockey blocked the deal due to political pressure and his decision would cost jobs and economic growth, Shadow Treasurer Chris Bowen says.

Mr Bowen said he would have approved the takeover if Labor was still in government.

"I do not see the national interest test was properly invoked in this instance," Mr Bowen told the National Press Club, adding he would have approved the deal based on the available information.

Mr Hockey last week blocked the $3.4 billion takeover of GrainCorp by American agribusiness Archer Daniels Midland (ADM) after deciding it was contrary to the national interest.

Farm groups and the government's junior partner the National Party had campaigned heavily against the deal, which would have given ADM control of 85 per cent of Australia's east coast grain ports.

Australia's Foreign Investment Review Board examines all major foreign investment proposals and must decide if they are contrary to a loosely-defined "national interest" test. However, the treasurer of the day must make the final decision.

In his decision, Mr Hockey said approval of the ADM-GrainCorp deal could have undermined public confidence in the foreign investment regime and undermined future foreign investments.

Bowen said he had publicly supported foreign investment to signal Labor's support for the deal but Mr Hockey caved in to political opposition from the Nationals.

"The best he could come up with was to say we need to knock this back to promote public confidence in foreign investment so we can get more in the future," Mr Bowen said.

"It doesn't pass the common sense test. Clearly this was a decision frankly that was taken for political reasons. I'm not entirely sure it was a decision that Joe Hockey didn't have foisted upon him. It's a decision which he claims to be his own. If it is his own, it is a particularly weak one."

Earlier, opposition agriculture spokesman Joel Fitzgibbon used a debate on a bill to change the way rural research and development is funded to attack the ADM-GrainCorp decision.

Mr Fitzgibbon said Australia needed more investment in agricultural infrastructure, research and development, skills and technology and inevitably much of this would have to come from overseas.

He said Australia was in significant competition for investment with South America, Indonesia and other countries, and investors would now be asking themselves if Australia's regulatory hurdles were too high.


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