Casting Australia’s business reputation overboard

The passage through the senate of legislation aimed at stopping the super trawler FV Abel Tasman throws another dark shadow on Australia’s reputation as a good place to do business.

The Dutch-owned, Australian-badged super trawler arrived in Australia in August to fish in an area called the Small Pelagic Fishery. The federal government recently caved to pressure from green groups to ban it for two years on the grounds that it would harm other sea life and lead to overexploitation of fish and deplete local fish stocks.

The FV Abel Tasman has been in effect declared an environmental hazard despite contrary advice from the government’s expert body – the Australian Fisheries Management Authority (AFMA).

Opponents of the super trawler have seized on a conflict of interest unveiled by the Commonwealth Ombudsman to justify overriding the AFMA’s decision. The ombudsman discovered that a representative of the company operating the super trawler attended and spoke at an AFMAadvisory committee meeting that recommended an increase in catch limits.

Allowing this conflict to occur was a stupid mistake, however it does not impinge on the science underpinning the AFMA’s catch limits or their recommendation to allow the super trawler to fish.

And the AFMA knows the science. It takes advice from ‘Australia’s and the world’s best scientists to set sustainable catch limits’ –limits that are ‘far more stringent than internationally accepted standards’. The AFMA says ‘the science shows that localised depletion is unlikely’.

Why is the government willing to listen to environmental experts on climate change but not on sustainable fishing? Isn’t ignoring ‘the science’ and wanting to wait and do further study exactly what climate change ‘deniers’ get pilloried for all the time?

Unfortunately, this decision is simply part of a larger pattern in Australian politics. Last year the Gillard government hastily imposed a temporary ban on live cattle exports to Indonesia, ignoring the economic and reputational impact on Australia’s agricultural export industry and increasing Australia’s sovereign risk profile. 

The Gillard government also backed away from its own recommendations about skilled migrant workers for large mining projects. Not to mention the backflips over the mineral resources rent tax and the carbon tax or the ongoing uncertainty over energy policy, especially coal seam gas.

Regardless of whether you approve of these policies (and some in business may even agree with them on principle), the last-minute poll-driven changes during implementation have made tough reforms tougher still. As business investment depends heavily on certainty, this policy on the run is increasing the risks of investing in Australia.

Nor is the Coalition blameless in this regard. In addition to its pledges to repeal legislation like the carbon tax, Nationals’ opposition to the sale of Cubbie Station (against the advice of the Foreign Investment Review Board), and a negative perception of comments on Chinese ownership by opposition leader Tony Abbott are contributing to the climate of uncertainty.

These issues are gaining prominence beyond our shores. The Dutch government reportedly raised the FV Abel Tasman issue at a recent meeting of European Union countries. Indonesia threatened to refer the live cattle export ban to the World Trade Organization.