THE federal government has refused to toughen regulation of foreign investment in agriculture, warning that a "xenophobic campaign" would rob farmers of opportunities presented by the increasing demand from Asian countries for secure food supplies.
Just 1 per cent of agricultural businesses by number, 11.3 per cent of farmland and 9 per cent of water entitlements have some foreign ownership, a report released yesterday says, according to The Australian Financial Review.
Assistant Treasurer Mark Arbib said foreign investment had significant benefits and that there were already rigorous controls.
However, the Coalition said the report relied on faulty data and the National Farmers' Federation called for the threshold at which the Foreign Investment Review Board must examine foreign investment in agriculture to be slashed to about $23 million from $231 million.
The Australian Bureau of Agricultural and Resource Economics and Sciences' report acknowledges growing public concerns but cautions against bowing to them.
"Concessions to concerns about sovereignty, distrust or fear of foreigners are likely to come at an economic cost to countries that restrict the inflow of foreign capital," it said.
Trade Minister Craig Emerson echoed this, warning Australia could pay a high price for "Hansonite" opposition to foreign investment in agriculture.
"Pessimists and political opportunists see the desire for food security of major emerging countries as a threat. In truth, it is an unsurpassed opportunity for Australian farmers," Dr Emerson said.
The ABARES report said data was patchy and suggested that the Australian Bureau of Statistics collect data more regularly. Senator Arbib said the government would fund expanded data collection every two years.
The government commissioned the report in late 2010 amid growing community concern about investment by foreign entities – including sovereign funds and mining companies – in agricultural businesses and farmland.
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