PM vs. EU: Albanese competes against Ursula von der Leyen for big green energy investors in NYC
The world’s biggest banks and investors will join the Prime Minister in New York to discuss his climate revolution, as he competes with the EU for green investment.
Anthony Albanese will use his $22.7bn Future Made in Australia funding vehicle, the promise of faster approvals and generous incentives as bait to lure hundreds of billions of dollars in global investment that would accelerate Labor’s net zero transition and help the government nudge closer to its target of 82 per cent renewables by 2030.
Amid rising global competition to attract capital from the remnants of Joe Biden’s torpedoed clean energy-linked Inflation Reduction Act, the Prime Minister on Wednesday (AEST) will spruik Labor’s big-spending measures and ambitious emission reduction targets as reasons why US investors should go all in on Australia.
Speaking at a New York investor event hosted by Macquarie Bank CEO Shemara Wikramanayake, Mr Albanese will also say 80 per cent of Australia’s mining deposits are under-explored and the country has the “space that makes it possible to co-locate extraction, refining, processing and manufacturing”.
But Mr Albanese is facing a particularly tough contest from European Commission President Ursula von der Leyen, who has implored investors to tell her “what you need” to bulk up the EU’s renewables rollout ahead of competitors like Australia.
High-profile attendees at Mr Albanese’s Future Made in Australia investor event include Bank of America chief executive Brian Moynihan, Goldman Sachs president John Waldron, Worley chief executive Chris Ashton, BlackRock senior managing director Joud Abdel Majeid, Carlyle Group managing director Richard Hoskins, Ares Credit Group co-head Michael Smith, Blue Owl global head of institutional capital James Clarke, Merrill Lynch chief executive Bernie Mensah and Morgan Stanley investment management chief Benjamin Huneke.
Australia’s ambassador to the US, Kevin Rudd, Consul-General to New York, Heather Ridout, Climate Change and Energy Minister Chris Bowen and Australian business chiefs including AustralianSuper CEO Paul Schroder and Fortescue billionaire Andrew Forrest will attend, along with senior representatives from companies including SpaceX, Alcoa, Austal, Boeing, Citi and Accenture.
From Australia being the sunniest continent in the world to boasting a skilled, productive workforce and sharing the same economic and security interests as the US, Mr Albanese will say that “we have the capability – and we have the capital”.
“Our system of universal compulsory superannuation means Australian funds continue to grow and invest,” Mr Albanese will say.
“Over the next decade, total investment in the US from Australian pension funds is expected to more than double. That will mean more than $1 trillion invested here in the decade to 2035.
“These same funds are investing in the drivers of growth in the Australian economy: infrastructure, energy, start-ups and private capital. Investing in Australia is about what we have – and where we are.”
As European countries aggressively pursue US investment into their clean energy projects, Mr Albanese will invoke Labor’s marquee funds and incentive programs to woo investors, including the $15bn National Reconstruction Fund providing loans, guarantees and equity to help commercial projects, the Future Made in Australia vehicle, production tax credits and supporting development of green iron, aluminium and steel to lower carbon fuels.
“All of this is reinforced by our commitment to reducing emissions,” he will say. “Our targets for 2030 and 2035 have us on track for net zero by 2050. This provides certainty for business to build for the long term. Put simply, our government’s plan for a Future Made in Australia is a ready-made opportunity for investment from America.”
Mr Albanese, who will also announce that the government will hold a Future Made in Australia global investor forum in November, plans to tell top US chief executives and investors that he wants to “add a new dimension” to Australia’s partnership with the US, which is already the nation’s largest foreign investor.
The global investor forum will be co-hosted by Mr Bowen and Industry Minister Tim Ayres.
“American capital and Australian manufacturing are a natural fit. And if we move now, we can make them an unbeatable combination. We can put our investment partnership at the centre of a defining global opportunity,” Mr Albanese says.
“The world’s shift to clean energy represents the biggest change since the industrial revolution. We are looking at ever increasing global demand for clean energy and the technology that generates and stores it.
“And if you started with a blank piece of paper and wrote down every asset and resource you would need to thrive in that economic environment, at the end of it you would hold in your hand a list of Australia’s strengths.”
Australia is facing hot competition across the globe, with Ms von der Leyen on Tuesday urging CEOs and investors in New York to “tell us what you need, what guarantees, what risk sharing tools or what is the regulatory conducive environment that you need”.
“In return, of course, we ask you to put your capital, your technologies, your innovation, to work in the regions where it will have the greatest impact, so that together we deliver on net zero, strengthen energy security, and that together we drive prosperity,” Ms von der Leyen told a UN Climate Week event on Tuesday.
She said “these days, stability and predictability are very important values … Investments in renewables grew by 63 per cent this year alone”.
“We have to invest heavily in our grids, in the interconnectors, so that the benefits of clean, affordable energy can reach every corner of our union and the energy is flowing to where it is needed the most,” she said.
With cashed-up Australian super funds investing offshore, the Albanese government is desperate to pull multiple levers that would bring more money into the country, drive economic growth and help Labor achieve its 2030 target of reducing emissions by 43 per cent on 2005 levels, while increasing renewables in the grid to 82 per cent. Mr Albanese and Mr Bowen last week released Australia’s new 2035 target, committing to cut emissions by 62-70 per cent.
In the wake of last month’s economic reform roundtable, which was criticised for failing to deliver more enduring tax and productivity measures, Mr Albanese will say his government would clear away “unnecessary barriers to major projects” and accelerate approvals.
“We’re not waiting for the world to come to us. We’re going above and beyond. Our Future Made in Australia agenda invests in the full life-cycle of projects: upfront capital, innovation and research – and production incentives, with targeted and tailored action – from fast-tracking approvals to direct incentives.”
Mr Albanese will say to investors that Australia is home to “the most valuable of resources: trust”.
“You know who we are – and what doing business with us means. You can trust in our laws and governance. You can invest with confidence in our institutions. You can build a secure supply chain, in our stable democracy. You can grow and thrive in an economy that values your investment and rewards your enterprise and aspiration.
“You can employ Australian workers, with confidence in their skills and smarts and productivity. You can draw on Australian research and innovation and know that it’s world class. You can take on the new challenges and opportunities of emerging markets – from a stable and familiar foundation.
“In a time of global economic uncertainty – you can be certain about Australia.”
Mr Albanese will describe Australia’s economy as being “geared for international investment, and for decades has been shaped by it”.
“We welcome it, we value it. We know the vital role it plays in our national growth and success.”
“For decades, the United States of America has been the proving ground for Australian entrepreneurs, innovators and creatives. In tech, in finance, in medical research and the arts, Australians have taken the view that if you can make it here, you can make it anywhere. Our cultures complement each other – both our similarities and our points of difference.”
Mr Albanese will name-check prominent US brands that are expanding footprints in Australia. These include “Google, Microsoft and Amazon in digital infrastructure, cloud computing and quantum, Pfizer, Baxter Healthcare and Cardinal Health in medical manufacturing, Chevron, Exxon, Lockheed Martin and Anduril, along with your biggest investment and private equity funds”.
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