Business - The Age - 25 April, 1998
The Multilateral Agreement on Investment faces indefinite postponement
BY Phillip Hudson
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The MAI, a controversial international treaty that would allow foreign investors great power in Australia, could be postponed indefinitely.
A top level meeting of the 29 member OECD is expected to be unable to agree on the terms of the treaty by next week's deadline.
The Guardian newspaper in London claim the worlds richest countries would stage a "humiliating climbdown" on the MAI which is due to be signed in Paris on Monday.
This would the best the second time the treaty has been postponed.
The Federal Government's representative, the Assistant Treasurer, Senator Rod Kemp, left Australia yesterday to attend the meeting. He said he did not expect the treaty would be ready to sign.
"We will not sign the treaty unless it is demonstrably in Australia's national interest to do so," he said.
A spokeswoman for Senator Kemp said there were several issues that concerned Australia. She also confirmed that the Paris meeting would discuss the future of the treaty.
The MAI has been described as an international constitution that sets out the rights of foreign investors.
Its supporters claim it will help Australian firms to gain access to overseas opportunitities and this will benefit Australian shareholders.
But the binding international rules have alarmed many. The Democrats, the Queensland independent MHR Mrs Pauline Hanson, and the former Chief Justice of the High Court, Sir Anthony Mason have been among the strongest critics.
Each country can lodge a list of exemptions for the treaty, which will allow them to impose more stringent requirements on foreign investors.
Australia's list includes the media, real estate telecommications, aviation, immigration policies, privatisations, foreign aid, government grants, social services, environment protection and labour standards.
A draft copy of a confidential ministerial statement to be released next week, which was obtained by The Guardian, showed that although the politicians will restate their commitment to the MAI, they will say further work is needed before it can be sealed.
The statement refrains from setting a new deadline, stating that it should be concluded "at the earliest possible date". According to The Guardian, OECD sources said the agreement has now effectively been put on hold.
"It has not been scuppered but it's certainly been put on the back burner for political reasons," one source said.
The Age understands that three options will be put to a vote at Monday's meeting.
The first is to postpone the signing of the treaty for 12 months. The second is to postpone it indefinitely and the third is to hand it over to the World Trade Organisation.
The MAI negotiations started in 1995.
Some of the strongest resistance to the treaty has come from France and the United States.
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The Age is a Melbourne newspaper.