Hockey stands by ADM call

Controversy reignited this week when Foreign Investment Review Board (FIRB) chairman Brian Wilson conceded the government’s rejection of the ADM takeover bid was politically motivated.

Mr Wilson also conceded it was also a legitimate decision, but Opposition leader Bill Shorten said it was “scandalous that we have politics determining the foreign investment decisions of the government”.

“It just seems to me that the Abbott government is very good at fighting for their own jobs but not so good at fighting for anyone else's jobs,” he said.

“It's not just the GrainCorp decision based on politics, it’s the demise of naval ship building, it’s the death of the car industry, it is the sacking or retrenchment of thousands of public sector workers.”

Responding to reports on the FIRB chairman’s comments, Mr Hockey said “I make no apologies for my decision in relation to ADM and GrainCorp – none at all - and I think the Australian people support that”.

Mr Hockey said the FIRB chairman was also right to say the ADM decision had not impacted on foreign investment levels in Australia.

“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 and there can be also proven benefit, if you like, in the fact that we have a robust foreign investment system but one that always protects the national interest,” he said.

“There may be other decisions that I have made that Australians might not like but the law is very clear.

“I have to make a decision where that investment would be contrary to the national interest and that is certainly where I step in and I am not afraid to do so.”

Speaking to The Australian Financial Review in his first interview since the ADM takeover was rejected last November, Mr Wilson said the ADM ruling was a one-off decision that didn’t hurt the FIRB's credibility.

He said there was heavy public pressure on the government to protect Australia's largest publicly listed agribusiness from falling to foreign control.

“It was a one-off outcome of a particular set of timing and circumstances which I don't believe has been seen as creating any long-term concern or precedent,” he said.

“Most people understand occasionally politics – and I don't mean party or partisan, I mean in the concept of the Australian government's relationship with the Australian people – from time to time politics intrudes into all areas of our lives.”

Mr Wilson also confirmed reports that the FIRB was split in its decision to block the takeover, which Mr Hockey conceded when announcing his determination.

Leading up to the Treasurer’s decision, rural Liberal and National Party members were lobbied heavily by national farm groups to block the GrainCorp sale amid fears ADM’s management would constrict supply chain competition, especially at ports.

Nationals Leader Warren Truss also spoke out strongly in favour of retaining local control and ownership of a major Australian supply chain asset, especially given most east coast grain ports have bee sold off to major foreign grain companies, since the national wheat export market was deregulated in 2008.

NSW Liberal Senator Bill Heffernan had also expressed fears debate over the GrainCorp sale was being clouded by hedge fund lobbyists - set to make millions in commission from the sale going ahead - rather than giving more serious consideration to potential supply chain impacts on farmers.

“So far the debate has been about political positioning, workshop words and lunches, avoiding direct questions and papering over the national interest,” he said at the time.

“But everyone’s avoiding a discussion about what’s in this by way of a better deal for growers and tax revenue for the government.”

However, Shadow Treasurer Chris Bowen and Shadow Agriculture Minister Joel Fitzgibbon both seized on this week’s media reports that the Treasurer’s decision to block the GrainCorp takeover was a political one.

“The Treasurer’s rejection of the ADM bid for GrainCorp was the first test of the Abbott government’s ‘open for business’ promise,” they said in a joint statement.

“In direct conflict from its pre-election pledge, last November’s decision to block the $3.4 billion bid continues to have reverberations throughout the grains industry and the agriculture sector more generally.

“Treasurer Joe Hockey never properly explained the decision but we now appear to have confirmation it was one based on political expediency alone.

“The decision sent all the wrong signals to the international investment community at a time when Australian agriculture desperately needs investment to take advantage of the Asia-led mining boom.”