FIRB chairman Brian Wilson repeats call to keep politics out of Chinese foreign real estate investment decisions

The chairman of the Foreign Investment Review Board (FIRB) says xenophobic attitudes towards Chinese enterprises buying Australian assets will hurt Australia economically.

Speaking at Australian Institute of Company Directors (AICD) function in Perth this week, Brian Wilson beat a familiar drum urging that  foreign investment decisions should be made on a purely standalone commercial basis.

Wilson is a former investment banker, having been appointed to chair the FIRB in April this year.

His comments follow the issue of foreign ownership becoming a political hot potato over the sale of Cubbie Station, a massive irrigation farm, covering around 1,000 square kilometres of south-western Queensland.

The mooted $300 million sale of Cubbie Station to a syndicate headed by the Chinese textile company Shandong Ruyi has been approved by Federal Treasurer Wayne Swan, following an assessment by the FIRB, which vets sales exceeding a threshold of $244 million.

The property near the Queensland-NSW border was placed into voluntary administration in 2009, with reported debts of more than $320 million.

Among those opposed to the sale is Nationals Senator Barnaby Joyce and independent Senator for South Australia Nick Xenophon.

However, local Nationals MP Bruce Scott, who holds the seat of Maranoa, where Cubbie Station is located, says the FIRB should decide with politics keeping out of the issue.

Federal opposition leader Tony Abbott in a speech in Beijing in August called for tougher rules governing foreign investment, adding that Chinese investment in Australia was more complex due the prevalence of state-owned businesses.

At the AICD function Wilson said Chinese investment into Australia would eventually become as accepted. He pointed to similar concerns when Japanese interests bought up a large number of Queensland tourism assets in the 1990s.

"I've got to say to you, if the Japanese wanted to buy a tourism property in Queensland now, I suspect everybody would get down on their hands and knees and say, 'Thank you'," he said in a speech reported by The Australian and the Australian Financial Review.

“With the nationalistic, xenophobic views of the world, the economic benefit foreign investment brings to our country is lost.

“Over time and with familiarity it will become less of an issue,” he added.

Wilson also highlighted that Chinese investment made up just 2.6% of foreign investment into Australia last year, though it is growing.

“The simple fact is success in trade leads to success in investment, and the current boom we have in investment from Asia says something about Australia’s place in the world.”

Wilson expects that a register of foreign-owned farmland being called for by Nationals and rural Liberal MPs will be created.

The vast majority of around 10,000 offshore real estate investments in Australia are approved every year.

Larry Schlesinger

Larry Schlesinger

Larry Schlesinger was a property writer at Property Observer

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