The managing director of Australia’s biggest dairy exporter Murray Goulburn, Gary Helou, said it was “inexcusable” that Foreign Investment Review Board (FIRB) approval process could be politicised.
He made the comments after Foreign Investment Review Board (FIRB) chairman Brian Wilson admitted politics influenced the government’s rejection of a major proposed takeover in the sensitive farming sector.
Mr Wilson said on Tuesday that Archer Daniels Midland’s (ADM) proposed $3.4 billion takeover of GrainCorp was blocked partly for political reasons.
But he insisted it was a legitimate decision.
Murray Goulburn lost out to Canada’s Saputo in a $500 million takeover battle for Warrnambool Cheese and Butter this year.
Saputo was quickly granted FIRB approval while Murray Goulburn’s offer languished in front of the Australian Competition Tribunal.
There is widespread speculation that Saputo’s approval was expedited to diminish criticism of the Coalition’s “open for business” catchphrase when it blocked the ADM bid.
“The local player was not allowed to compete,” Mr Helou said.
“The approval application was the fastest in recent history for FIRB and that is hard to take.
“Indeed we are disappointed if we were roadkill for that political decision and it is quite a big cost for the dairy industry to pay.”
A leading American business group says Australia’s foreign investment approval process is “opaque” in the wake of the Wilson revelations.
But Treasurer Joe Hockey made no apologies on Tuesday for the decision, saying it had “no impact at all” on the level of foreign investment.
“In fact, there has been a reasonable increase in the level of foreign investment in Australia, which just goes to show that when I make decisions in the national interest, I make no apologies for it,” Mr Hockey said.
“I make no apologies for my decision in relation to ADM and GrainCorp, none at all, and I think that the Australian people support that.”
The US Council for International Business called for Australia to be “more transparent” about the reasons behind foreign investment adjudications.
The USCIB’s vice-president for public affairs Jonathan Huneke said it was vital Australia had an open and transparent system for reviewing and facilitating foreign investment.
“The decision seems somewhat opaque and the system seems somewhat opaque in Australia,” Mr Huneke said.
“You don’t want companies going down a rabbit hole when it comes to making an investment decision or takeover attempt.”
Source: The Australian Dairy Farmer
