The Federal Government’s doubling of FIRB fees from today to a maximum of $1 million will erode Australia’s ability to attract the capital needed across all sectors of the economy.
To ensure Australia’s mining, downstream processing and manufacturing industry is to grow the Government needs to address the high cost of doing business in Australia.
Capital is an essential component of boosting both labour productivity and wages. Australia is facing an investment shortfall with our capital stock growth rates at record low levels.
The capital shortage is yet more acute in mining which has been the largest source of economic growth in Australia over the last decade.
To maintain the current production of existing mines Australia needs at least $20 billion in capital every year.
For Australia to expand mining and benefit from growing demand for the spectrum of minerals essential for the transition to renewables – copper, zinc, nickel, gold and the raft of critical minerals needed for our sustainable future – substantial additional foreign investment will be required.
The government’s proposed doubling of foreign investment fees works directly against this objective.
Australia’s productivity challenge is only increased by higher hurdles for foreign investors.
The doubling of the FIRB fees adds to the list of costs such as taxes and fees for land access making Australia an even more expensive place to do business.
