David Goodfellow: ‘Don’t block foreign investment in agriculture’

With the global financial system under threat, it would be folly to block foreign companies from investing in Australian agriculture, says one of the nation’s most experienced fund managers.

Stem the tide: Australia must prevent a flight of capital from investments already held by overseas interests. Picture: Aaron Francis

ONE of the nation’s most experienced funds managers says Australia should not spurn foreign capital investment into the agricultural sector.

David Goodfellow, who headed Chinese investment firm Rifa Salutary and the local arm of the Canada’s Ontario Teachers’ Pension Plan, said it was folly to block foreign companies from investing in Australian agriculture just as the global financial system was under threat and the nation’s farm sector faced the end of the latest cycle of overseas capital.

His comments come as the Federal Government this week announced all foreign investments – regardless of sector or monetary value – will need Foreign Investment Review Board approval during the coronavirus pandemic, in a bid to stop overseas companies taking over struggling Australian assets.

“We want to stop predators who are acting against the national interest,” Treasurer Josh Frydenberg said.

Mr Frydenberg said the temporary change was “not an investment freeze”, and Australia was still open for business.

Foreign investment in agriculture has long been a touchy subject for the Coalition, particularly following several high profile purchases of farmland and agribusinesses from Chinese investors in recent years.

But Mr Goodfellow said Australia should pull out all the stops to stop a flight of capital from investments already held by overseas investors.

“We need to continue to attract foreign capital into our country because we are falling a little bit behind the rest of the world in terms of the pace which we’re improving our efficiencies and productivities,” he said.

Mr Goodfellow said foreign capital generally came in cycles of 30 years, such as from the British in the 1920s or the Japanese in the 1980s.

The current wave of capital had come from China since 2014 and, more recently, the US and Canada.

“We can’t afford to upset the Chinese and Canadians now and tell them to go away and we don’t want them, because they will withdraw all their capital out of our industry,” Mr Goodfellow said.

“It will create a crisis we can’t imagine.”

Mr Frydenberg refuted suggestion the changes were targeted at China.

“This is not about one particular country, but about ensuring that the national interest is enhanced,” he said.