David Littleproud, leader of the Nationals, has called on the Australian Labor government to critically reassess the nation’s free trade agreement with the United States. This demand follows a significant surge in farmland acquisitions by affluent American investors, including the recent purchase of arable land valued at $500 million by the Mormon Church within a mere six months.
Littleproud argues that the existing provisions have effectively opened the floodgates for wealthy foreign buyers, enabling them to outbid local farming families and jeopardizing the Australian dream of land ownership. He emphasized the need for Treasurer Jim Chalmers to closely examine the agreement, noting concerns about “widening loopholes” that may further exacerbate the situation.
Concerns Over Agricultural Land Ownership
“The current framework allows large organizations, including religious institutions and corporations with substantial financial backing, to outcompete Australian farmers,” stated Littleproud. He believes that the original intent of the agreement did not foresee such extensive foreign ownership of agricultural land in Australia.
A specific concern lies in a provision of the agreement that allows US-owned entities to acquire farming ventures in Australia without the oversight of the Foreign Investment Review Board (FIRB) or the Federal Treasurer, provided the investments do not exceed a threshold of $1.46 billion. This exemption extends to New Zealand and Chile, while other foreign investors are limited to a cumulative cap of $15 million.
When questioned about the possibility of reviewing these provisions, Treasurer Chalmers did not provide a direct response.
Calls for Inquiry and Review
The pressing nature of this issue is underscored by Colin Bettles, chief executive of Grain Producers Australia. He supports Littleproud’s call for a review of the trade agreement, emphasizing the need to ensure food security and protect national interests. Bettles raised critical questions regarding the relevance of rules established 25 years ago and their effectiveness in today’s economic landscape.
“If a company from any other nation was acquiring farmland at this pace, it would be front-page news,” Bettles remarked. He stressed the necessity of updating the FIRB national interest test to safeguard Australian sovereignty and ensure that local farmers are not placed at a competitive disadvantage.
Bettles also suggested that either the House of Representatives Standing Committee on Primary Industries or the Senate Standing Committees on Rural and Regional Affairs and Transport could conduct an inquiry into these matters. Such an inquiry could investigate how foreign tax incentives might provide competitive advantages to overseas entities, impacting local land values and farmers.
Shadow Treasurer Ted O’Brien has been contacted for his perspective on whether he supports calls for a review of the free trade agreement. However, he has not yet responded to inquiries regarding potential Coalition policy if Labor does not act.
As discussions unfold, the implications of foreign ownership in Australian agriculture continue to be a significant point of contention, raising questions about the future of domestic farming and food production in the country.
