by Tony Orman
The Government intends to woo foreign investors in a bid to speed up investment from overseas.
Foreign investors will find it easier to buy New Zealand companies and property after the government “reforms” the Overseas Investment Act.
However there is concern by New Zealanders that foreign investment has never been reined in and that the Overseas Investment Office is largely ineffective said Andi Cockroft, chairman of the Council of Outdoor Recreation Associations.
“New Zealanders access for outdoor recreation is being decreased as a result as new foreign owners bar public access. Plus past opinion polls indicate as the greater majority of New Zealanders are opposed or uneasy over foreign investment particularly of natural resources,” he said.
Just a few days ago, associate Minister of Finance David Seymour said the government had agreed to easing the onus of proof as New Zealand’s criteria were the “worst in the developed world”.
The Overseas Investment Act lays down it is “a privilege for overseas persons to own or control sensitive New Zealand assets” and requires would-be investors to prove their investment was of benefit to New Zealand.
David Seymour claimed New Zealand had been rated by international investors as bottom for “openness to investment.”
But a Stuff article said last year, the United States State Department regarded New Zealand as having an open and transparent economy and that foreign investment was “generally encouraged without discrimination”.
Reversal
In its latest move, the Government in a bid to encourage more investment from overseas, is set to reverse the current the burden on foreign investors to prove their investments would benefit the country,
“At the core of these principles is reversing the presumption that investing in New Zealand is a privilege and that investors must justify their transaction to the government,” said David Seymour.
Meanwhile the Campaign Against Foreign Control of Aotearoa reported that overseas investors owned nearly 30% of all company equity in 2020, citing research from broker JBWere, and 18% of the country’s net wealth in 2021.
However David Seymour said attracting more overseas investment was a vital part of the Government’s economic strategy.
All investments that are currently screened, including applications to buy farmland, would continue to be screened, Cabinet has agreed. The Overseas Investment Office would “fast-track” assessments with the assumption investment could proceed unless risk factors were identified, by “consolidating” its investor test, the ‘benefit’ test and the national-interest test.
Government will have the flexibility to “call-in investments for detailed scrutiny on a case-by-case basis” and impose conditions or block investments where there were risks to New Zealand’s national interest, said David Seymour.
Forestry
However the Council of Outdoor Recreation Associations said individual sectors of the economy were heavily foreign owned now.
“The forestry industry has majority foreign ownership somewhere about 80%,” it said.
The previous Labour government eased restrictions on foreign speculators investing in carbon farming via a streamlined ‘special forestry test’.
As a result, in the period January 2019 to April 2024, the New Zealand Overseas Investment Office (OIO) approved 228 sales of either forests or farmland bought for the purpose of converting to forestry such as carbon farming, while during this time, only nine applications were rejected with seven of these occurring in 2023. In total, these sales equal an area of 259,000 hectares.
In 2019 an investigation by Radio New Zealand (RNZ) found that the four largest private landowners in New Zealand are all foreign-owned forestry companies. The report says that this has occurred despite a clampdown on overseas investment. According to RNZ then since the Labour coalition government was formed in 2017, the Overseas Investment Office (OIO) had approved more than $2.3 billion of forestry related land sales.
Difficulty
The Council of Outdoor Recreation Associations said It was often difficult to pinpoint foreign ownership as mostly they disguised themselves as New Zealand companies. He cited Ernslaw One as an example which was largely Malaysian owned via the Tiong dynasty, Summit Forests NZ Ltd as 100% Japanese owned and Ellis Campbell NZ Ltd as 100% UK owned.
The largest landowner in New Zealand in 2019 was Taumata Plantations Ltd, with ownership Canadian 42%, Australia 28%, UK 15% and US 15%. CORANZ said the use of a Maori name while not illegal, deceptively implied it was a New Zealand company.
Sources say other sectors of the economy had even heavier foreign ownership than forestry, citing the wine industry of which foreign interests owned 85 per cent of New Zealand’s wine production.
“Government owes it to the public to strip these smoke and mirrors disguises away and give the true extent of foreign ownership,” said Andi Cockroft.
Outdoor Access
Of special significance to CORANZ was that access to the public’s outdoor recreation estate such as for fishing, tramping, hunting and other pursuits, suffered as overseas buyers invariably came from a culture different from New Zealand’s egalitarian society.
“Locked gates are the usual consequence of foreign buyers of New Zealand’s rural land whereas the traditional Kiwi farmers almost always gave access permission to bona fide recreationalists,” said CORANZ’s Andi Cockroft.
Reports indicate an increasing amount of the South Island high country with high public recreational values, is being transferred to foreign-owners, with locked gates and public access barred said CORANZ.
It is not just access to the foreign owned land itself, but it is apparent New Zealand and Overseas land owners know that by blocking access through their land they can block access to large tracts of public land beyond. This situation is not helped by DOC who fail to create proper access when high country tenure reviews or similar property changes occur.
It is frustrating to have to walk several hours through scrub or up rough riverbeds knowing there is a farm track or forestry road a few hundred meters away inside a property boundary accessing the same end point.
A sorry case occurred when a set of Synlait farms were sold near the Rakaia River. The new (Chinese) owners found that on the titles of the dairy farms they had purchased there was Rakaia River bed vested under the Conservation Act 1947, paper roads belonging to the Selwyn District Council, and other land held by LINZ.
The OIO’s response was to quietly “regularize” the titles. The result was anglers were blocked from yet another access point to the Rakaia River.
National in the 2023 election campaign campaigned for more foreign ownership of houses.
A poll last year in August just before the election, asked about 1000 eligible voters: “Do you support or oppose foreigners being allowed to buy existing homes in New Zealand that are worth more than $2 million?”
Of those polled, 39% supported National’s plan while 46% opposed it. The rest didn’t know or preferred not to say.
There is simply no doubt that outdoor access for New Zealand recreationalists of every stripe will reduce under foreign ownership. The idea of Kaitiakitanga or guardianship is foreign indeed to the offshore buyer, who sees the land as tied up, locked off, private and for the benefit of a sole owner. Over decades New Zealander’s have contributed to and cared for the land, wetlands, rivers and bays, that offered bounty to her people. The Queen’s Chain preserved that for all, and it is eroded only when foreign ownership dictates that ‘you shall not pass’. This coalition Government in its haste to fast track legislation, and deregulation and the dismantling of protections and organisations, is rapidly turning our country into a land of litigation, where everything is fought in the courts, requiring vastly deep pockets to fund any hearing at all. Organisations such as Fish and Game, and the NZFFA, are not funded by government but are expected to maintain and control the asset with voluntary efforts, membership fees and donations.
It is a vastly one-sided exercise to have single voices raised against the might of massive funded legal teams. If this selling off of the country is not well publicised, one would have to turn to the organs of dissemination and ask why; nearly all media outlets tout their extraordinarily rich owners right-based political views. This is no assertion on my own part, but comes from a former Murdoch employee editor of mainstream media. I urge those who think we are dealing with a fair playing surface to read Eric Beecher’s book – “The Men Who Killed The News” published by Simon and Schuster in Australia.
One thing which really annoys me about politicians is they say one thing when in government and the opposite when in Opposition. In April this year Labour spokesman Damien O’Connor complained the National-led coalition government is opening the door to more foreigners buying land here.
But when he was a senior cabinet minister in Labour government, restrictions on foreign speculators investing in carbon farming were eased via a streamlined ‘special forestry test’.
High quality, productive beef and sheep farms were converted to pines by carbon farming speculators, many overseas investors or corporates off-setting their own gross pollution. Two-faced? Dumb?
Only fool would believe that foreigners “invest” in New Zealand for the benefit of New Zealand and its citizens.
The foreign “investors”, that will buy up more of our businesses, natural resources and other assets, are NOT FOOLS that are spending their money to help New Zealand.
There seems to be a dependency culture here.
Too many people want someone else to solve their problems for them instead of accepting the responsibility to do it themselves.
They say that “the government” should do this or that to protect and provide for them, like their parents did when they were children, and the politicians and bureaucrats pretend that they can do it.
The government is just some people we employ to work for us but do not manage very well.
Instead of doing what we hired them to do, they make more and more rules to control us, take what we have earned from us, borrow more money that we have to pay interest on and eventually try to repay, waste our money on “vanity projects” and make it more difficult for productive working people to become better off.
Of course we want more money and foolishly expect the people called “the government” to get it for us.
How can they do that?
1. They can rob us by creating more taxes, fees, licenses, levies and fines for us to pay.
2. They can borrow more money for taxpaying workers to service and try to repay in the future.
3. They can invite more foreigners to buy and own our lands, natural resources, businesses and other assets until we have none left to sell.
What these people called “the government” cannot do is produce valued goods and services that willing buyers will pay for.
Work is what ordinary people do every day to help produce the desired goods and services that willing buyers value and can afford to buy.
Work is producing and selling real products that other people want to buy with their own money.
The people we call “the government” do not understand this because they do not have to produce and sell valued goods and services to willing buyers that can afford to pay for them.
All they know how to do it SPEND OTHER PEOPLE’S MONEY because the other people keep allowing them to do it.
Now they want to get more of other people’s money by enabling foreigners to buy up our businesses, lands, natural resources and other assets.
This asset sale will have some short term financial benefits and more serious long term bad consequences because the productive use of these assets will benefit the foreign owners much more than the citizens of New Zealand.
The Maori people sold off their assets in the past.
Now their descendants regret it.
OURS WILL TOO!
The only way for people to become more financially secure and prosperous is to do more productive work that provides willing buyers with goods and services they value and can afford to pay for.
The people we call “the government” cannot do that for us and what they do usually makes it more difficult for us to do it for ourselves.
These people called “the government” are not our parents and we are not their children.
They do not protect and provide for us as they pretend.
They just take and spend other people’s money, control us with more and more restrictive regulations and now they want to sell off our stuff to foreigners so that they can spend the proceeds.
Fools and their money are soon parted.
We need to wise up, reduce the authority and power of the people called “the government” and take back the ownership of our own lives, money and national assets before they are all gone.
Stop pretending that the politicians and bureaucrats we employ are our parents. GROW UP and be responsible, independent, productive adults that can create prosperity by providing desired goods and services to willing buyers that can pay for them.
The push for foreign investment by governments is not new. Well done Tony for highlighting its extent. The current push, spearheaded but the ideology of Seymour and the far right is pure and simply setting out to create restriction free profit making; irrespective of the environmental harm or the harm to the values that most New Zealanders cherish.
Consider specifically the anti-Treaty rhetoric. The Treaty Principles sections of Acts covering crown owned land stop the government selling off more than half of any publicly owned asset (including land) – refer to the Mighty River case. If they do away with this Treaty protection then they can sell off the whole 100% to foreign investors. Can we live with that?