Centralizing Australia's Approach to Foreign Investment? (2001)

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The proposal 

"A high level report to the Prime Minister has called for a new strategy to attract foreign investment, including a single agency to promote Australia Inc overseas and a review of international taxation policies. Citing concerns for Australia's taxation policies, environmental and competition laws, the report also calls for industry specific promotion of sectors with strong potential .... the report has strongly criticized the system of investment attraction and promotion. These efforts have been hampered by the lack of a national strategy to pursue overseas direct investment, the involvement of a multiplicity of Commonwealth, State and Territory agencies, whose offices until now have been largely uncoordinated, some duplication of effort and the failure to establish an Australian investment brand in offshore markets" (Lewis S., 'Australia Inc: the new blueprint", Financial Review, 14/8/01 - referring to the Blackburn report, Winning Investment: Strategy, People and Partnerships

The Blackburn report contains many platitudes - but its criticism of the multiplicity of investment promotion mechanisms is valid (Walker T., 'Arrogance about our appeal unfounded', Financial Review, 14/8/01)

Sounds good: What's wrong with that?

[Caution:  the following CPDS comments are based on press reports about  the above proposal which may not accurately convey its intent] 

There is undoubtedly considerable value in assessing Australia's tax and regulatory environment from the point of view of strongly encouraging foreign investment - and in inhibiting the ineffectual efforts which assorted government agencies make to promote investment. 

However Queensland's experience shows that a centralized agency to coordinate government  responses to major investments could be VERY damaging. Reasons for this are set out below:

The proposal as put forward may risk a firm step along Australia's path to really becoming  'the banana republic' (see Note 24).

Developing an Alternative

Australia might consider adopting the traditional (West) German practice of giving precedence to owner / managers of firms in seeking advice concerning public support for Australian business and industry - rather than obtaining such advice from the local branch-managers of multinational firms.