Mitsubishi CEO calls for 'stable' investment climate in Australia - The Australian Financial Review
Mitsubishi CEO calls for ‘stable’ investment climate in Australia
Mitsubishi, one of Japan’s biggest investors in Australian resources, has called on the Labor government to ensure a stable investment environment, warning the clean energy transition needs to be approached with caution.
Mitsubishi chief executive Katsuya Nakanishi’s comments follow warnings from Tokyo Gas and Inpex which are concerned about the stability of LNG supply under Labor’s new gas policy, and the cost of operations under emission cutting targets.
The Japanese multinational giant has joint venture interests in coal, iron ore and gas across Australia to power Japan’s electricity grid and industrial base.
“There is a strong future for the relationship,” Mr Nakanishi told the Australia Japan Business Co-operation Committee’s annual conference in Melbourne on Monday. About 300 senior Japanese executives travelled to Australia for the conference.
“We have a relationship of trust. I hope the relationship can guarantee a stable investment environment,” he said.
The CEO’s comments echoed remarks made by Japan Economy and Trade Minister Yasutoshi Nishimura stressing the need for Australia to have a “stable investment environment” in talks with three senior Albanese government ministers in Melbourne on Sunday.
Trade Minister Don Farrell assured Mr Nishimura that Australia remained a stable supplier of LNG during the talks that also included Energy Minister Chris Bowen and Resources Minister Madeleine King.
Mr Nishimura told Japanese media after the meeting with the three ministers he was still concerned about the impact of Labor’s emissions policies on LNG and coal supply, news agency Kyodo.
Japan’s trade minister Yasutoshi Nishimura in Melbourne on Sunday Luis Enrique Ascul
“I reiterated to Minister Bowen that Japanese companies are more concerned than ever about the predictability of investment in Australia” due to the law, he was quoted as saying.
He also voiced concerns over Australia prioritising LNG supply for domestic use as it did in August last year and said it may trigger a gas security mechanism that would allow the government to limit LNG exports in the event of a shortfall to ensure enough gas is available locally, Kyodo reported.
At the conference on Monday, Mr Nakanishi said the clean energy transition had to be approached with caution, as he emphasised its operations would require carbon offsets under the federal government’s emission-cutting regime.
“We need to be careful in the way we achieve net-zero,” Mr Nakanishi said.
Labor’s tougher emission reduction policy, known as the safeguard mechanism, gives 215 of the country’s highest polluters an emissions bar, which will be lowered by 4.9 per cent per year. If the emitters go over the limit, they must buy credits from outperformers as an incentive to get under the bar.
“We need to start with small things, we can start working on the energy of renewables,” he said. “We have to make sure we can get carbon credits.”
Japanese media reported Mr Nishimura telling the Labor government that Japan was opposed to China joining the Trans-Pacific Partnership trading bloc because it had engaged in economic coercion against both Japan and Australia.
“The positions of Australia and Japan are in complete agreement. Unjustified restrictive practices such as economic coercion are contrary to the objectives and high standards of the agreement,” he said, rebuffing China’s call to enter accession negotiations, the Mainichi Shimbun reported on Monday.
Elouise Fowler is a journalist for The Australian Financial Review based in the Melbourne office. Connect with Elouise on
elouise.fowler@afr.com.au
Michael Smith is the North Asia correspondent for The Australian Financial Review. He is based in Tokyo. Connect with Michael on
michael.smith@afr.com
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