Labor bets on private capital, approves $278bn in foreign investment

Labor has approved $87 billion in additional foreign investments, bringing the total for the year to $278 billion as it bets on more private capital to buoy the economy.

Treasurer Jim Chalmers announced that the additional $87 billion was approved in the June quarter, taking the growth rate of approved investments by the Foreign Investment Review Board (FIRB) to an average of 17% per year.

"Half of all approved applications are processed in 30 days or less. This is more than double the 22% we saw in the previous government's last year in office," he told the recent Citi A50 Australian Economic Forum in Sydney.

In the three months to June, Singapore was the largest source of approved commercial investment proposals by value at $9.7 billion.

This was followed by the US at $9.3 billion, Canada at $5.7 billion, the Philippines at $4.4 billion and the UK's $3.9 billion.

The US remains the largest foreign investor in Australia over the last three years, trumping other nations. In FY25, it splashed a whopping $122.3 billion on local commercial deals, while Japan came in second at $15 billion and Canada third with $12.7 billion.

Finance and insurance were the largest target sectors for approved commercial investment proposals, totalling $27.5 billion for the recent quarter. Commercial real estate came next at $24.3 billion.

"We're making the most of those partnerships by encouraging more investment from abroad and making it easier to do business here," Chalmers told the event.

"By streamlining and strengthening our foreign investment framework to make low-risk investment more straightforward and high-risk proposals better scrutinised. It means faster assessments, more certainty and more capital flowing into our markets."

Chalmers went on to laud private capital's role as the "primary driver of prosperity in the economy."

The International Monetary Fund estimates that Australia's economy is growing faster than almost every G7 economy and will continue at this pace for at least five more years.

Chalmers emphasised that this growth is "overwhelmingly driven by private sector activity."

"Private demand has picked up while public demand has eased. In fact, private-demand growth tripled last financial year compared to the year before, while public-demand growth halved," he said.

"In annual terms, private demand is contributing four times as much to growth compared to public demand. Our debt is lower than every G7 country and will peak lower too."