Only 2% foreign owned

August 8th, 2014 at 11:00 am by David Farrar

The Herald reports:

Prime Minister John Key made an assurance no more than 2 per cent of New Zealand’s farmland was foreign-owned as controversy continues over the sale of Lochinver Station near Taupo to Chinese company Shanghai Pengxin.

Labour and New Zealand First say they’ll block the sale of the 13,800ha property if they are in a position to do so after next month’s election, in response to strong public concerns over foreign ownership of farmland.

Mr Key and his Government have downplayed the scale of the issue and say they would act if there was evidence of a “run” on New Zealand farms by foreigners.

Yesterday, Mr Key said the Overseas Investment Office (OIO) told him in writing they believed “the amount of rural land that’s owned by foreigners is 1 to 2 per cent”.

An issue the media have not touched on much is that these proposed bans are illegal. We have the CER agreement with Australia, and under that can not ban Australians from owning property in New Zealand.

So Labour and NZ First’s policy would have us in breach of our oldest and most important trading agreement.

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26 Responses to “Only 2% foreign owned”

  1. Odakyu-sen (746 comments) says:

    Is that 2% of the total area of farmland or the best 2% of total farmland? There is “2%” and then there is “2%.”

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  2. Jack5 (5,155 comments) says:

    On National Radio yesterday the Massey professor who, earlier, in business life was associated with management of the Crafar farms under Chinese ownership, agreed with Murray Horton, the Leftist guy who runs the Campaign Against Foreign Control.

    They agreed there were no accurate statistics of foreign ownership of NZ land.

    What does Key base his statement on?

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  3. Redbaiter (9,599 comments) says:

    So in spite of all the hysterical claims of “xenophobia” etc, there’s actually no principle involved, and now it all boils down to “how much”?

    Sounds like a flip flop to me.

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  4. mikenmild (11,719 comments) says:

    Not that I think restricting ownership is a good thing, but Labour specifically referred to CER when talking about the policy, and not in the sense of abrogating it in any way. It’s not our ‘oldest’ trading agreement, BTW.
    The 2% figure could also be read as “Oh my god, foreigners already own 2% of New Zealand”.

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  5. EAD (1,312 comments) says:

    Is the Australian government Communist? No? Then no big deal.

    http://www.telegraph.co.uk/news/worldnews/1541566/Africa-discovers-dark-side-of-Chinese-master.html

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  6. anticorruptionnz (215 comments) says:

    How can they be so accurate ? Many overseas investors are purchasing land through New Zealand companies set up in a way so as to hide the true identity of the owners.

    The registration of the land is in the name of the New Zealand company and therefore does not show up as foreign .

    New Zealand companies are set up they become shareholder in another company, sometimes fanning out to massive numbers of companies. each of these New Zealand companies is capable of owning real estate.

    It is also possible to sell a company complete with its assets so a NZ Company owning property can be sold off without change of title yet fall into foreign hands.

    People died for their countries. their lives have been cheapened by selling off what they died for

    Grace Haden Independent candidate Epsom http://www.Anticorruption.co.nz

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  7. WineOh (630 comments) says:

    Is it just the dairy industry that is of interest to foreign interests? Yes probably… dairy prices have been sky high for a few years now, but recently there has been a big slump in the prices paid & its total speculation as to what will happen in the future. The big reduction in dairy $$ will likely scare off international investors, especially with the Kiwi dollar annoyingly high.

    In terms of calculation of farm area, it may include all apple & kiwifruit orchards, sheep & beef farms (sheep farms generally much less intensive land use compared to dairy), and also non-productive farm land.

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  8. Nookin (3,465 comments) says:

    Cunliffe is of the view that he can simply declare, in advance, that he will revoke any consent given. Adern said on the television this morning that the minister has a complete discretion.

    Here is section 14 Overseas Investment Act 2005.
    14 Approach to criteria for consent
    (1) The relevant Minister or Ministers, in considering whether or not to grant consent to an overseas investment transaction,—
    (a) must have regard to only the criteria and factors that apply to the relevant category of overseas investment under this subpart (subject to this section); and
    (b) may consult with any other person or persons, as the Minister or Ministers think appropriate; and
    (c) must grant consent if satisfied that all of the criteria in section 16 or section 18 (as the case may be) are met; and
    (d) must decline to grant consent if not satisfied that all of the criteria in section 16 or section 18 are met.

    I am not quite sure what part of section 14 (1) (c) gives a Prime Minister in waiting authority to declare an intention to revoke consent in advance when the person concerned has not seen any of the detailed application and is wholly ignorant of the arguments and supporting facts advanced. I am also struggling with Adern’s interpretation of the section to the effect that it confers a complete discretion on the Minister. What is it about “must grant consent” does she not understand?
    If Labour do not like it then they can change the rules. In doing so, it would be interesting to see how they explain what has changed in the period since they, themselves, wrote the rules ( in a more liberal form than presently exists).

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  9. s.russell (1,646 comments) says:

    The Southland Times reports today (not online I think) that a Dutch tulip company is planning to set up in Southland. Will they be buying land? Will this spark the same degree of outrage as the possible Chinese purchase near Taupo?

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  10. Viking2 (11,565 comments) says:

    What a lot of fuss about nothing.
    We didn’t hear a lot of noise when the Maori’s newly given their fishing quota to benefit their “people” promptly sold it of in numerous ways to foreigners.

    Whats the difference.?

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  11. somewhatthoughtful (467 comments) says:

    Oldest and most one sided perhaps. You ever tried starting a company or getting a right to trade in oz? Fucking joke of a process considering CER supposedly exists.

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  12. Jack5 (5,155 comments) says:

    S. russel (at 11.19)

    I think Dutch settlers, note settlers, have been farming tulips in Southland for decades, and there has been trade with the Netherlands.

    I have checked with a Southland friend, and he says there is no mention in the Southland Times report whether the Dutch tulip company is buying land or is a non-growing operation. If they want to buy land, there is no mention of whether they would accept long-term lease land rather than buy land. If there is to be a farm, there is no mention of whether Dutch experts will live and work in Southland to run the operation.

    Even if this does entail purchase of Southland land, it will be of small size, and will differ from the Chinese land purchases of NZ land in a number of ways, including:

    1. Reciprocity: the Netherlands lets NZ farmers buy land in the Netherlands.

    2. The Dutch lead the world in tulip growing, and probably in horticulture at large. They bring technology and know-how while in dairying, NZ has nothing to learn from China. The Chinese bring only capital to secure their imports upstream.

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  13. flipper (4,205 comments) says:

    Nookin…

    Excellent, in all respects.

    What about funding a comprehension class or two for Adern and the MSM children? :-)

    Jack5…

    Read Key’s statement, but to refresh:
    “Mr Key said the Overseas Investment Office (OIO) told him in writing they believed “the amount of rural land that’s owned by foreigners is 1 to 2 per cent”.

    Odakyu-sen …..’
    Key says OIO says “farmland”. If correct, actual % of total would be close to zero. No?

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  14. jackinabox (776 comments) says:

    Dutch immigrants own most of NZs dairy farms and run Fonterra. Ask a Dutchman what he thinks of the Lochinver Station deal and he will tell you, fuch zat, what cun de Chinaze bring to Nuew Zeelant, verdom et mun, de verrakte cloothufters cun de pot op!

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  15. greenjacket (484 comments) says:

    “Labour and New Zealand First say they’ll block the sale of the 13,800ha property”

    On what basis? Why? The only two reasons why are:
    1. The foreign owners are intended to use the land for some evil purpose . If this is the case, then Cunliffe and Winston First shoudl state what that diabolical purpose is.
    2. Cunliffe and Winston First are pandering to racists who just don’t want Chinese people in New Zealand.

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  16. JC (972 comments) says:

    Its difficult to nail this down. Nathan Guy is reported in Stuff that Labour in its 9 years sold 663,000 and to date National 189,000. Thats about 57,000 per year averaged over the two parties.

    If we times that by say 25 years we get 1.4 million ha or about 5% of total NZ area.

    However, land ownerships constantly change and get sold and as likely come back into NZ ownership so the true figure could something less.

    The total area farmed is about 15 million ha so 2% is 304,200ha.

    That figure could represent the actual area of foreign owned farmland once sales back and forth are taken into account.

    Key was careful.. he said about 2% of farmland which excludes the big forestry purchases which really bump up the foreign ownership.

    JC

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  17. gump (1,661 comments) says:

    @DPF

    “So Labour and NZ First’s policy would have us in breach of our oldest and most important trading agreement.”

    ——————————

    That’s a load of rubbish.

    Australian citizens have always been required to apply to the OIO for sensitive land purchases, and the OIO is not bound by the CER Treaty to grant those purchase requests (they’re assessed individually).

    http://www.linz.govt.nz/overseas-investment/applications/faqs

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  18. lastmanstanding (1,300 comments) says:

    When did a pollie any of them worry about breaking the law. So what. they just pass a law making their retrospective law breaking legal.

    Want an example. Look no further than the Mangawhai Council and their waste water plant. Council broke the law incompetent Auditor General did 5 audits and didn’t pick it up Government passed retrospective legislation so Justice Paul Heath couldn’t give the ratepayers the justice they deserved.,

    Always remember Government is the enemy of the people.

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  19. lastmanstanding (1,300 comments) says:

    Grace Haden is alas correct under NZ company law you can set up a web of companies that hides the true ownership and the purchasing company is classified as a NZ company so the assets it owns are NZ assets but the real control over those assets resides offshore.

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  20. Albert_Ross (310 comments) says:

    Depends what you mean by “control”, lastmanstanding. Land use, employment conditions, building permits etc on New Zealand land are subject to New Zealand law whoever the owner and whatever their nationality.

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  21. salt (135 comments) says:

    Depends where the profits go. If that 2% is all dairy capacity, that would earn its owners $300 million every year in revenue. If all the profit is then just heading offshore, then it won’t take long for New Zealand’s end of the deal to look like a pretty poor one.

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  22. itstricky (1,881 comments) says:

    Oh, the continual banging on about this is hillarious. When the shoe is on the other foot, you know National will reach for the FUD card…

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  23. hj (7,066 comments) says:

    Last night Campbell Live ran a poll on whether ownership of New Zealand farmland should be restricted.

    READ MORE: Should foreigners be allowed to buy New Zealand land?

    This year the Overseas Investment Office has approved the sale of Kiwi land to buyers from more than 20 different countries.

    We were overwhelmed with responses – nearly all 18,000 in favour of excluding foreigners from buying farmland.

    Read more: http://www.3news.co.nz/Where-in-the-world-can-Kiwis-buy-land/tabid/817/articleID/355761/Default.aspx#ixzz39mdyS0u9
    …..
    Obviously an unscientific self-selected polling of the uninformed.
    Doesn’t mean a thing.
    ….
    My friend says “I know, I was one of the texters. But if you don’t vote National where on earth is there a credible party to vote for”

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  24. hj (7,066 comments) says:

    Winston?

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  25. masterman (19 comments) says:

    We’ve taken the economic power out of the nation and put it at the international level. And we’ve left all the other powers, the binding powers, inside the nations, which means we’ve put all the other, non-economic powers at a severe disadvantage. 
 
And that’s why we’re finding today that democracy feels as if it’s been turned on its head, as if it has no teeth, as if it has no power, as if it only can react, because we’ve engaged in a form of almost unconscious suicide by allowing these enormously important powers to escape from our hands to the international arena without before, let alone at the same time, getting equivalent binding powers for the common good at the international level.

    The merger mania which goes on and on and on is the sign of the disappearance of competition. As we deregulate, the mergers increase which means there’s less and less competition. At the national level, at the regional level but also at the international level. Fifty-one per cent of the largest economies in the world today are corporations not countries.

    None of this loss of competition which is a form of loss of freedom, to say nothing of a failure of capitalism by its own terms, none of this is inevitable. It’s the conscious creation of us somehow as citizens allowing the treatment of economics as the leader of our society, of our societies. It’s been disastrous for competition, disastrous for capitalism, it’s led us into those terrible roads – monopoly and oligopoly. It’s bad for prosperity, the prosperity which is needed for their model, their model which is dependent on consumption. It’s disastrous for their model of consumption. 00 companies sales represent 28.3 per cent of the world’s GDP, and those companies employ point-75 per cent of the workforce, less than one-per cent of the workforce. 
 


    Any decent conservative capitalist would be horrified to realise that so much production was in the hands of people who provide so few jobs, because it’s that production which provides wages to people which allows them to consume. So it’s their model that’s failing, not the socialist model, not the social democratic model, not even the small ‘l’ liberal model, it’s the economic rationalist model which fails by its own definition. 


    Transnationals take the fewest risks, do the least long-term investment, do the least r and d compared to small real capitalist companies, are the most top heavy in management, much more bureaucratic than government departments, and much more expensive bureaucracy than government bureaucracies.

    The broader picture – some thoughts from John Ralston Saul

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  26. V (749 comments) says:

    Countries with deficits in their current accounts will build up increasing debt and/or see increased foreign ownership of their assets.

    Isn’t this the key point in the whole argument over land/assets?

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