ABC, The World Today
ELEANOR HALL: The Trade Minister Steve Ciobo has signalled the Federal Government is preparing to update its foreign investment guidelines to appease disgruntled Chinese investors. The rule changes are expected to apply to critical infrastructure to ensure that all investors have clear guidelines on the assets up for sale in Australia. Mr Ciobo is in Hong Kong attempting to reassure Chinese investors that Australia is open for business. He spoke to the ABC's Peter Ryan.
STEVEN CIOBO: The message I'm conveying today in Hong Kong is to reinforce the importance of foreign investment into Australia. It's an important part, an important precursor, to having a healthy economy and it's part of the reasons why we've enjoyed 25 years of continuous economic growth, which makes us the envy of the developed world.
PETER RYAN: But after the Treasurer's rejection of the Ausgrid sale to Chinese investors, are you getting the message that Chinese investors feel discriminated against?
STEVEN CIOBO: I'm not getting that message. I want to make sure that people have a sense of proportion about investment into Australia. On average around 1000 applications a year are received from business investment into Australia and on average we've seen less than 1 rejection per annum. Now that's consistent with an open for competition outward looking economy, one that embraces the benefits of foreign investment, one that recognises that investment must be consistent with Australia's national interest, and making sure that we continue to apply that framework, in a non-discriminatory way, is an important message to reinforce in the global capital market.
PETER RYAN: Is this a matter of providing more clarity to Chinese investors or other investors in the future that certain assets like power grids or major utilities like telcos might be off limits.
STEVEN CIOBO: WellI want to make sure that when it comes to investments into Australia that people understand the Australian economy is looking for capital at all times. I want to make sure that there's a clear understanding by those that are attending this conference that Australia does continue to have an open approach with respect to investment, one that helps our economy grow, but also reinforce that we, of course, at all times, retain the right to make sure that investment that is inconsistent with Australia's national interest is vetoed.
PETER RYAN: So that would be providing a greater clarity in the guidelines and making it clear that perhaps some major infrastructure assets like power grids or telcos would not be the sort of things they could bid for.
STEVEN CIOBO: Well it's not about putting forward a prescriptive list about assets that they can and cannot bid for. It's about adopting an approach that drives investment that's good for Australia, and I want to make sure that approach and our framework is understood well by international investors. Know that even though there's been some headlines of late with respect to the Ausgrid decision, we very much remain open to business knowing that that's good for our economy.
PETER RYAN: Open for business, but with a few caveats.
STEVEN CIOBO: We always retain the caveat. That is that all investment must be consistent with Australia's national interest and I think that's a common-sense approach. It's an approach, I believe, that Australians support, and it's an approach that the Coalition will continue to adopt.
PETER RYAN: Cheung Kong Infrastructure and the Chinese state-owned company State Grid were known to be a bit angry after Mr Morrison's decision. Have you been able to meet with them?
STEVEN CIOBO: I'll be meeting with CKI a little later on today to speak to them very directly about not only their proposed investments in Australia, but also those existing suite of investments that they currently hold.
PETER RYAN: Have you experienced any personal feedback or anger from Chinese investors during your brief time in Hong Kong?
STEVEN CIOBO: No. I want to make sure that we're proactive about our engagement with global capital markets, but I reinforce. The reason why foreign capital is important is that they're partners with domestic Australian capital, and together those are vital precursors to strong economic growth and strong economic growth creates better opportunities for Australia with respect to employment. It help to drive national prosperity.
PETER RYAN: Is there any timeline at all when we might see an updated foreign investment guidelines?
STEVEN CIOBO: The Treasurer's currently working through a number of proposals with respect to, in particular, critical infrastructure. Of course under the Coalition you've seen updates to the foreign investment framework and a number of initiatives that the Coalition undertook since coming to office. Initiatives that we believe make sure that our system continues to be non-discriminatory, continues to be transparent, and continues to assert the primacy of protecting our national interest. Now that can work very well and provided it's communicated well to investors, it means that they can have certainty about investment proposals in Australia and at the same time Australians can have certainty that investment into Australia is going to be good for our country.
ELEANOR HALL: That's the Trade Minister Steven Ciobo speaking from Hong Kong to the ABC's Peter Ryan.