The Federal Government has recommitted to introducing legislation to create a new corporate collective investment vehicle as part of its broader strategy to increase the effectiveness of its Asian Region Funds Passport regime.
The Minister for Revenue and Financial Services, Kelly O'Dwyer has told a Sydney forum that the Government remains committed to growing and exporting the Australian funds management industry.
"As Australia transitions from a resources-led economy to a services-led economy, we are uniquely positioned to take full advantage of the positive demographic changes that are happening in our region," she said. "However, at just 3.4 per cent, foreign sourced funds only represent a tiny proportion of Australia's AUD$2.66 trillion dollar funds management industry."
O'Dwyer said this could be compared with other major financial centres in the region such as Singapore and Hong Kong, which had around 70-80 per cent of funds under management sourced from offshore investors.
"An increase in Australia's foreign sourced funds under management to even 10 per cent, would translate to significantly more investment, more Australian jobs and growth in GDP. In fact, modelling prepared by Deloitte Access Economics for the Financial Services Council (FSC) shows that merely doubling the current percentage of funds management exports could lead to an increase in GDP of AUD$326 million and more than 700 jobs by 2029-2030."
She said that to ensure that Australia would be competitive within the passport framework, the Government would introduce legislation this year to create a new corporate collective investment vehicle, or CCIV.
"The CCIV regime will facilitate the export of Australian funds via investment vehicles that are commonly used overseas, and which are widely understood by foreign investors," O'Dwyer said.