The Federal Government’s National Interest Analysis [2014] ATNIA 7 for the Japan-Australia Economic Partnership Agreement [2014] ATNIF 14 (JAEPA) promises many benefits for Australia’s economy flowing from JAEPA, especially enhanced access for Australian goods and services to the Japanese market. Liberalisation of screening thresholds for Japanese private investment in Australia is another element of the agreement.

And just as JAEPA has been assessed in national interest terms, so Australia’s Foreign Investment Policy and the Foreign Acquisitions and Takeovers Act 1975 (Cth) require the Treasurer to determine whether certain foreign investment proposals are “contrary to the national interest” before approving them.

Updated The Laws of Australia Subtitle 24.2 “Foreign Investment” observes that in the foreign investment area, “national interest” is a flexible concept, susceptible to changing “political considerations”. Some principles seem fixed though, for example, Australian governments have imposed on foreign investment proposals conditions aimed at maintaining Australia’s national security interests and ensuring Australian air services continue internationally, domestically, and regionally.

Even with apparently uncontroversial national interest principles, however, meanings are not certain, with underlying purposes and sectional interests informing their content. Perceptions of the national interest are also politically subjective. In December 2013, Treasurer Joe Hockey decided to remove previously imposed restrictions on Chinese State-owned enterprise Yanzhou Coal Mining Co Ltd owning Australian coal assets. This decision may seem inconsistent with Australia’s national interest in that it effectively allows a foreign power to own Australian resources. But the Government indicated the decision was warranted in part by a need – in the face of slowing demand, falling coal prices, and mine closures – to support the coal industry.

Similarly, recent changes to Pt 3 of the Qantas Sale Act 1992 (Cth) raising the limit on foreign ownership in Qantas – from 25% for private investors and 35% for foreign airlines to 49% – highlight divergent views on how to secure the viability of Australia’s “national carrier”. Against the background of Qantas’s difficulties in a highly competitive market – a $252 million half-year loss (now $2.8 billion) and foreshadowed 5,000 job cuts – the Government argued for lifting restrictions on foreign investment in the airline as a means to strengthening its competitive capacity.

This de-regulatory, market-forces driven approach encapsulates a particular conception of the national interest. An alternative view sees the national interest best served by having greater government regulation of and involvement in Qantas – even its re-nationalisation. Public ownership and control is here understood as an expression of national sovereignty and as guaranteeing Qantas’s service of important social functions, including providing employment locally, supporting Australia’s engineering skills base, and helping Australians in emergencies.

JAEPA’s raising of screening thresholds on Japanese investment in Australia, from $248 million to $1,078 million for investment in non-sensitive sectors before Foreign Investment Review Board consideration is incurred, is clearly anticipated by the Government to give a job-creating, capital-accumulating, resources-utilising boost to Australia’s economy. But the Government also sees JAEPA as helping enhance Australia’s “strategic partnership” with Japan. And in tandem with JAEPA, Australia and Japan concluded an agreement on defence equipment, science, and technology cooperation – underlining the military dimension to the strengthened relationship.

This enhanced relationship will also complement the United States strategic “rebalance” to the East/South East Asia-Pacific region. Further to this, Japan is pursuing a more militarily assertive foreign engagement policy and Australia’s role in hosting US armed forces – including long-range bombers – is increasing. From China’s perspective, all these developments may seem aimed at its strategic containment and as endangering its national interests. That’s the problem with national interests – everybody has them.

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