English scathing on squeeze

Nats leader says reasoning on tightening for foreign buyers shows delusions of grandeur

Opposition leader Bill English says David Parker is suffering from “delusions of political grandeur” if he thinks New Zealanders are so disgruntled with foreign investment that it might lead to our own version of Brexit or the rise of Donald Trump.

Parker, the Associate Finance Minister, made the claim when announcing yesterday a new ministerial directive to the Overseas Investment Office that will impose broader restrictions on foreigners buying New Zealand farms larger than 5ha, excepting forestry land.

Parker said the previous directive undermined the criteria in the Overseas Investment Act, opening the door to rubber-stamping overseas purchases of farms up to 10 times the average size. This meant the criteria were effectively being applied only to sheep and beef farms larger than 7146ha, or dairy blocks over 1987ha.

He said the new directive would help ease the types of concerns over the influence of ultra-wealthy foreigners that had led to the rise of Trump and Brexit overseas.

“The middle class in New Zealand is uncomfortable that their prospects in life are being, to a certain extent, hampered by the influence of 1 per centers from overseas who can outbid them for assets that they would otherwise be the buyers of.

“It sends a message that the New Zealand Government is at the forefront of trying to deal with some of the excesses of globalised capital.

“We want to avoid the backlash that has occurred with the election of President Trump, Brexit, and some of the rise of fringe parties in Europe.”

English said the comments showed “delusions of political grandeur”. “The fact is, New Zealand is an open economy. We’ve been wellserved over generations by foreign investment. It brings jobs, technology, management skills.

“There’s always people who are disappointed in any transaction around houses or land, and we’ve seen times where foreign buyers have been blamed for that.

“By and large people accept that foreign investment is usually good.”

English said the many regional farms benefited from foreign investment, and he would watch closely if the new directive had a negative effect on the regions.

The new directive will apply from December 15. Forestry relies heavily on foreign investment and will be exempt, as the Government looks to make good on its promise to plant 1 billion trees in the next 10 years.

At the same time, a new forestry directive will give greater importance to domestic processing.

Parker said the new directive will also tighten how the office will assess each application, placing less import- ance on donations and more on bringing in new technology and generating more jobs and exports.

It also cuts the time limit for overseas investors saying they will move to NZ from five years to 12 months.

Federated Farmers welcomed the new directive, saying it reached a good balance. “But equally we’re pleased the Government is not closing the door on overseas investment in our primary sector,” vicepresident Andrew Hoggard said.

Parker said the directive will slow the sale of NZ farms to foreign buyers until changes to the act next year.

All applications being assessed by the OIO on and after December 15 will be subject to the directive. Applications not ruled on by then will be invited to make extra submissions.

Act leader David Seymour said it was unfair to apply it retrospectively.

Parker also said a bill to ban foreigners from buying NZ homes will be introduced before Christmas.