Hypocrisy from NZ Super Fund
The Foundation for Defence of Democracies notes:
New Zealand’s $36 billion sovereign wealth fund divested $4 million from five Israeli banks last month because of their West Bank operations. This could cause reputational and financial problems for New Zealand and for companies managing its sovereign wealth fund.
Flawed information and analysis spurred the fund’s decision. In a letter explaining the move, the Guardians – the government entity that runs New Zealand’s sovereign wealth fund – cites concern about Israel’s plans to annex portions of the West Bank. However, Israel agreed to suspend its annexation plans in September 2020 as part of its peace deals with the United Arab Emirates and Bahrain. Subsequently, UAE-based Abu Dhabi Islamic Bank signed a memorandum of understanding with Bank Leumi, one of the Israeli banks subject to divestment.
The letter erroneously describes United Nations Security Council Resolution 2334, which declared that Israeli settlement activity “has no legal validity and constitutes a flagrant violation under international law,” as “binding.” However, the council passed that resolution under the non-binding Chapter VI.
So the people in charge of $36 billion made two factual errors in their justification for their decision. That is a worry.
Yet even as they condemn Israel, the Guardians invest in one of the world’s leading human rights abusers. The fund holds nearly half a billion dollars’ worth of investments in 625 Chinese companies, including two companies blacklisted by the United States for violating the rights of ethnic minorities. China has detained up to 1 million Uighurs from Xinjiang province, suppressed pro-democracy protests in Hong Kong, and continues to occupy Tibet.
Likewise, while the fund divested from Israeli banks, it invests in companies extracting natural resources from another disputed territory. On March 15, New Zealand’s High Court upheld the sovereign wealth fund’s right to invest in companies operating in Western Sahara, a non-self-governing territory occupied by Morocco.
The hypocrisy is huge. If human rights was the issue, they’d pull all 625 investments in China.