Former treasurer Peter Costello has warned his successor Wayne Swan to think carefully before blocking the merger of the ASX and Singapore Exchange, as the nation's top CEOs questioned why the deal was being scuttled.
Picture: Sam Mooy
Former treasurer Peter Costello back in the media spotlight, speaking to journalists in Sydney.
Mr Swan has given proponents of the now-unlikely deal until Monday to convince him of its merits, after the Foreign Investment Review Board recommended unanimously that it would be contrary to the national interest.
Mr Costello said the merger, if it went ahead, would follow a strong international trend.
“Around the world there are these (stock exchange) tie-ups going on,” he said in Sydney.
“The London exchange has bought the Italian, it's now bidding for the Canadian.
“The Germans are bidding for the New York Stock Exchange, NASDAQ's got a counter bid.
“And the question is whether Australia is going to be a part of that, or whether Australia will seek to go it alone.”
Mr Costello said he thought the ASX case should be debated by MPs.
“Just because everybody else in the world is doing it, it doesn't mean it's right, but it also means you'd better think about it very carefully,” he said.
Mr Costello's unsolicited advice came as the Business Council of Australia called for Mr Swan to explain why the deal was contrary to the national interest if he followed through and blocked it.
The BCA, which represents the chief executives of the nation's top 100 companies, said the deal had the potential to turn Australia into a regional financial hub.
“At a time when increasing ties with fast-growing emerging Asian countries is supporting our growth potential, the integration of Australia's capital markets into the region will offer significant opportunities,” BCA president Graham Bradley said.
“These include lower costs for businesses, greater choice and more skilled jobs.”
Earlier, Mr Swan rejected suggestions of political interference in the FIRB's assessment of the deal.
The Treasurer said he had followed due process and would make known his reasons in full, including the advice of the FIRB, when he made his final decision.
“I've spent a lot of time reading material, seeking advice, consulting with the business community and the wider community. I've taken it very seriously. And I didn't start that process with a pre-established view,” he said.
“When I take a final decision I will publish all of my reasons in full and part of that will be the advice from the foreign investment review board.”
Mr Swan said there was no political interference in the Foreign Investment Review Board process and defended its integrity.
“Absolutely nothing could be further from the truth. The Foreign Investment Review Board is independent. They do their work, they take their decisions independently. They talk to me as the responsible minister.”
He said Australia's international standing would not be hurt if the merger did not proceed.
Grattan Institute economist Saul Eslake said there were legitimate concerns about transferring regulatory controls over Australian companies to a foreign stock exchange and possibly a foreign government.
“It did seem like it wasn't a particularly good deal for Australia, (but) it might have been a good deal for the ASX and its shareholders,” he told The Australian Online.
With AAP
©theaustralian.com.au
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