Rudd, Swan Must Act To Avoid Investment Crisis By Cutting Red Tape

Rudd, Swan Must Act to Avoid Investment Crisis by Cutting Red Tape

"Australia is missing out on foreign investment because of our arcane, restrictive regulations. Prime Minister Rudd and Treasurer Wayne Swan must act to avoid a potential investment crisis", Julie Novak, a Research Fellow at the Institute of Public Affairs, said today.

Ms Novak's comments follow new research released today in a major paper Australia as a destination for foreign capital.

"The latest data from the United Nations shows there is likely to be a significant downward trend in foreign investment. The IPA's research found unless Australia reduces the red-tape that faces foreign investment, Australia will simply miss out", Ms Novak said.

"The current financial crisis is only exacerbating Australia's investment crisis", Ms Novak said.

"Australia should be the first destination for investment capital. But we have become less, not more, attractive for foreign investors".

Earlier this year Treasurer Wayne Swan outlined six principles against which certain investment would be assessed. "Instead of loosening Australia's investment regulation, Wayne Swan has strengthened it", Ms Novak said.

Australia as a destination for foreign capital assesses the current state of play in global investment, the costs of current regulation administered by the Federal Treasury, and recommends reforms to Australia's foreign investment regulatory framework.

"If Australia wants to attract foreign investment it needs to review existing investment thresholds, unburden politically sensitive sector investment, and remove additional regulations on sovereign wealth funds and state owned enterprises"

Australia as a destination for foreign capital was released as part of the lead up to the forthcoming symposium Australia's Open Investment Future on Thursday, 4th December 2008.

For further information and comment:

A copy of Australia as a destination for foreign capital is available at www.ipa.org.au

Media contact:
Julie Novak
0437 646 045

SOURCE: Institute of Public Affairs