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FOREIGN "INVESTMENT" LEAVING NZ

Statistics New Zealand has quietly announced that $8.9 billion of net foreign investment was withdrawn from NZ in the last financial year.

According to John Morris, of SNZ: "This is the first time that there has been a net withdrawal of foreign investment out of New Zealand since the current (balance of payments) series began in the year ended March 2001".

Where were the Cabinet Ministers and media pundits shouting about that? Where was Bill English, who recently told the nation that the Government needs to further liberalise the 2005 Overseas Investment Act because "we need their (foreign investors') money and jobs"?

So instead of putting money into New Zealand, these much hyped foreign investors are actually taking money out. Nearly $9 billion in fact, and just in one year.

Fancy that. The Fairy Godmother who is going to give all of us money, according to the fairy tales, is actually taking money off us.

The Government needs to find a new fairy tale book to distract us while it goes about its business of throwing the country ever more open to being sucked dry by the transnational corporations, who are the only ones to benefit from liberalising NZ's foreign investment rules - plus the peddlers of fairy tales, of course.

Murray Horton
Secretary/Organiser

CAFCA
Campaign Against Foreign Control of Aotearoa
Box 2258, Christchurch, New Zealand
contact  cafca@chch.planet.org.nz
www.cafca.org.nz

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CAFCA   DoC  NEWS
Radio NZ News
Updated at 6:09am on 24 November 2009
The Department of Conservation (DoC) has confirmed that it is negotiating with a foreign company to plant trees on public conservation land and collect a share of the carbon credits.
Climate Change Minister Nick Smith revealed last week that talks were under way but has since gone quiet on the issue.
DoC says it has been talking with several foreign investors, but is now dealing with only one company, one with Australian connections. It says several parcels of land are being discussed, but won't say where they are.
The department adds, however, that those negotiations are now on hold until the Government's Emissions Trading Scheme is finalised.
DoC's aim is to regenerate indigenous vegetation, but it says the planting of exotic species may be permitted if it promoted native growth.
It says the foreign investor is likely to fund the regeneration programme and contribute toward another conservation project, and the parties would share the carbon credits.
The negotiations follow a two-year tender process.
Why hand over gains?, Labour asks
The Labour Party is questioning why the Government would hand over potential gains from the trees to overseas interests.
Climate change spokesperson Charles Chauvel says any such use of conservation land, in particular, should benefit New Zealanders.
"In principle, you'd want it to be planting by New Zealanders so that the profit from any harvesting comes back to New Zealanders and the credits go to New Zealanders. That would seem to me to be the overriding policy concern."
But Mr Smith told
Morning Report on Monday that such planting presents opportunities for New Zealand.
"Foreign companies are already in agreements to carbon-farm on those lands, providing it doesn't compromise the conservation objectives," he said. "And, in fact, in planting trees in any of these areas there's conservation gain."
Foreign involvement 'reprehensible'
Campaign Against Foreign Control of Aotearoa spokesperson Murray Horton says it's reprehensible to let overseas interests carbon-farm on Crown land.
"I don't see why our conservation estate should be used for planting trees for the exclusive benefit of transnational forestry companies," says Mr Horton.
"We've flogged off enough of the state forests, the exotic forests in this country that were established to set up a forestry industry for New Zealand."
Green Party co-leader Russel Norman says it would take a "very strong case" to justify why a foreign company should be brought in instead of DoC handling it themselves.
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NEW $477M THRESHOLD MAKES SICK JOKE OF ANY "OVERSIGHT" OF FOREIGN INVESTMENT

The Government has announced a new Investment Protocol for Australian investors in NZ, under CER. One of the new provisions is a vastly increased threshold of $477m - up from the present $100m. Anything below this sum will not require any kind of special approval, making a total joke of what is left of the "oversight" regime for foreign investment.

Australia is the biggest country of origin of foreign investors, so it is inevitable that the Government intends this new threshold for Australian investors to become the new benchmark for all others, as part of its further "liberalisation" of the 2005 Overseas Investment Act (which is in danger of being liberalised to death).

That is exactly what happened in 1999, when a CER Investment Protocol saw the threshold increased from $10m to $50m for Australians, and then become the benchmark for all others (Labour increased it again to the present $100m).

So, an increase from $10m to nearly $500m in just ten years represents an increase of the threshold of nearly 5,000%.

CAFCA has done some research to show just what that means in real terms. Below are some examples (all in the hundreds of million of dollars and in vital sectors of the economy) collected from the 2008 records of the Overseas Investment Office, of deals that would no longer require any kind of foreign investment "oversight" scrutiny under this new threshold.

This represents not so much leaving the key under the doormat but taking the door off the hinges and hanging a sign saying "Come on in and help yourselves".

Murray Horton
Secretary/Organiser


Examples of OIO decisions that would no longer require approval under the $477 million threshold.

Elderly Care

Macquarie Bank's Retirement Care (NZ) acquired Qualcare in February 2008 for $267 million. Qualcare is "one of the largest aged care operators in New Zealand, with 976 rest home and hospital beds, and 462 independent living villas and apartments. Ironbridge has invested A$36 million of equity for 60% of the business."

Lend Lease Corporation ("one of the leading international property groups listed on the Australian Securities Exchange") took over Babcock and Brown's aged care operation, Primelife in December 2008. It manages Primecare retirement facilities in Aotearoa, which have over 1,300 residents.

Energy

Origin Energy bought Swift Energy's assets for $110m in June 2008, including the Tariki, Ahuroa, Waihapa and Ngaere (TAWN) gas fields; the Waihapa production station; the Rimu, Kauri and Manutahi fields; the Rimu production station; and separate oil and gas pipelines from Waihapa production station to New Plymouth. Other assets which Origin acquired from Swift included 50% of two offshore exploration permits PEP 38495 and PEP 381201 south of the Kupe and Rimu - Kauri fields.

Tourism

Private equity funds managed by CVC Asia Pacific bought 65% of the Stella tourism group for $133m in February 2008 from the failing MFS (Octaviar) group. The Stella Group was an amalgamation of travel operations amassed by the MFS group including for example the Gullivers Travel Group, New Zealand's largest travel agent.

Forestry

In March 2008, Ernslaw One owned by the Tiong family of Malaysia acquired Winstone Pulp International for $117m. This included 3,896 hectares of freehold at Waimarino Forest, the Karioi pulp mill, 10,059 hectares of leasehold at Waimarino Forest and the Tangiwai sawmill.

Mining

In December 2008, an application by Cheung Kong Infrastructure of Hong Kong to take over New Zealand Steel Mining Limited for $250,000,000 was declined. The mining company controls a leasehold interest in 1392 hectares at Taharoa Road, and 1.2 hectares of freehold land at Tahuri Street and Te Waitere Road, Kawhia, South Auckland. New Zealand Steel Mining Limited operates a titanomagnetite (ironsand) mine.


CAFCA
Campaign Against Foreign Control of Aotearoa

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