One of Australia's most prominent business leaders in Asia, ANZ (ASX: ANZ) CEO Mike Smith, believes Australia shouldn't be concerned about overseas investment. The Australian reports that Mr Smith's speech to the 51st Japan-Australia Joint Business Conference in Tokyo will emphasise the possibilities and opportunities foreign investment will bring to Australia in the future.
Recently, many politicians have become concerned about foreign entities buying up huge stakes in Australian companies, assets and property. One foreign takeover that has raised more than just eyebrows is Archer Daniels Midland's $3 billion offer for GrainCorp (ASX: GNC).
The GrainCorp deal requires the approval of Treasurer Joe Hockey but MP Barnaby Joyce and Deputy Prime Minister Warren Truss have pressed him to reject the takeover. Mr Smith, however, believes, "our relationship shows that there's no reason for foreign investment to challenge our national identity… the equation is to deal sensibly with the control questions and to be innovative with funding structures we develop."
There are a number of other deals that need to be approved by the treasurer, including State Grid of China's approval for the multibillion-dollar stake in SP AusNet and Jemena from Temasek.
Prime Minister Tony Abbott recently declared Australia 'open for business' and understands the importance of foreign investment in our country's future, particularly from Asia. "Our new Prime Minister, Tony Abbott, has already shown a strong commitment to deepening relationships with Asia, which is very welcome."
Mr Abbott recently took a group of Australia's most prominent business leaders, including Commonwealth Bank boss Ian Narev and Telstra Chairwomen Catherine Livingstone, to Indonesia to reinforce his commitment for trade throughout the region. Mr Smith believes the Prime Minister has made "positive progress" with Indonesia and has prioritised completing free trade agreements with China, Japan and South Korea.
China is at the forefront of many trade and business ventures into Asia but Mr Smith believes "old friendships need to be nurtured with the same care as new ones" and highlighted Japan as an example of what foreign investment can be. "In Australia, we have to recognise the lesson of our relationship with Japan is that deep and lasting connections with the opportunities of the Asian Century will come through trade and through accessing Asia's pools of capital.
Foolish takeaway
ANZ will be pushing for more trade and business to take place throughout Asia as it tries to establish itself as a super-regional bank. Tapping into the region's growing middle-class population and businesses is likely to prove lucrative for industries such as energy, fisheries, finance and tourism here in Australia.
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Motley Fool contributor Owen Raszkiewicz does not have a financial interest in any of the mentioned companies.
