Fdi
1. PATTERN OF FDI FLOWS
Australia was ranked as the eleventh most attractive destination in the world for foreign direct investment (FDI) in A.T. Kearney's 2007 FDI Confidence Index.Australia’s economic performance, political stability and proximity to Asia makes it the best destination for FDI. USA is the largest source of FDI to Australia.Australia uses its foreign savings to fund its investments rather than depending on the domestic savings. Due to this the country’s foreign debt is growing and has a current account deficit. Until the 1970s, foreign investment flows to Australia were largely regulated through the foreign exchange control mechanism with intervention of the government. In 1975 government introduced formalized foreign investment policy which was focused on the needs and aspirations of Australians. This insisted indolent of Australians either in BoD or as employees. Keeping in mind the factor that more and more Australian assets are having foreign ownerships, the pre-establishment screening process for FDI is still continued by Australian government.
The Foreign Investment Review Board (FIRB) is a non-statutory body established in April 1976 to advise the Government on foreign investment policy.The main functions of the FIRB are:
To examine proposals by foreign interests for investment in Australia and, against the background of the Government's foreign investment policy
to make recommendations to the Government on those proposals
To advise the Government on foreign investment matters generally
To foster an awareness and understanding, both in Australia and abroad, of the Government's foreign investment policy
To provide guidance, where necessary, to foreign investors so that their proposals may be in conformity with the policy
To monitor and ensure compliance with foreign investment policy
Summary of Australia’s investment policy1
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