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Potential of Treaty deserves a hearing

By Senator the Hon Rod Kemp,
Assistant Treasurer, Victoria,
Liberal Party of Australia
9 February 1998

Debate on foreign investment is vital, but must be more balanced says Rod Kemp

There were alarmist views about the proposed Multilateral Agreement on Investment (MAI) on The Age opinion page last Thursday, including the suggestion that an MAI poses a threat to Australia's democracy.

Pauline Hanson and the leader of the Democrats, Senator Meg Lees, have also claimed MAI negotiations are being conducted in secret and that the Government's ability to attach conditions to foreign investment is in jeopardy. It is important that misinformation about the MAI is corrected.

The Government's position on the MAI, or any other treaty, is clear. We will not sign the MAI unless it is demonstrably in Australia's national interest. Our national interest encompasses the interests of the community as a whole - not just the interests of large firms.

Negotiations for this treaty began under the former Labor Government in 1995 and are continuing. The Howard Government has not committed itself to signing the treaty. Our commitment to continuing the negotiations is based on the potential benefits the treaty could bring to Australia.

The aim of the MAI is to provide a strong and comprehensive framework for international investment. The MAI would provide investors with greater certainty as to the 'rules of the game' when investing in foreign countries.

Investment helps to stimulate the economy, bringing benefits from the creation of jobs, from higher income and from new technology.

A major benefit in the treaty is that it would help Australian companies gain greater access to foreign markets. Also, existing and future Australian investments would be more secure because of the legal protection offered by the MAI.

Joining the MAI would not endanger Australia's existing laws and policies. While the proposed MAI generally requires foreign investors to be treated no less favorably than domestic investors, it will be possible for countries to make exceptions where they want to impose more stringent requirements on foreign investors than on domestic investors.

Australia will create whatever exceptions are required to protect our laws and policies, including immigration, foreign investment (including the media and real estate) and Government grants and subsidies.

Likewise, Australia will be able to protect its environmental and labor standards, Australian content in programming, the sale of public assets, fishing rights and the affairs of our indigenous people.

There have been many claims that these negotiations have progressed in secret. There is nothing secretive about the negotiations or the MAI. Australia's participation in the negotiations was announced at the outset.

Unlike the previous Labor Government, the coalition Government has put in place a rigorous treaty-making process which will ensure that binding action is not taken on the treaty until it has been subjected to proper parliamentary and public scrutiny.

The Government has also actively consulted, and continues to consult, the states, industry organisations and other interested non- government organisations about the details and implications of the MAI.

It is also hypocritical of the Democrats, who often support Australia signing treaties supporting their own narrow interests at the expense of the broader community, to claim that Australia is 'signing away its sovereignty' with the MAI.

The Democrats wanted the Government to sign the greenhouse emissions treaty proposed by the European Union which, at that stage, would have required Australian industry to carry an unfair burden and would have cost tens of thousands of Australians their jobs.

An appropriately negotiated MAI will create jobs and promote national prosperity.

This Government welcomes interest in, and debate on, the MAI. But it is in the interests of all Australians that the debate be balanced and informed.

Rod Kemp is the Assistant Treasurer
Email: opinion@theage.fairfax.com.au