Treasury: drop all screening of foreign investment
Acting Secretary to the Treasury Gabriel Makhlouf has hit out at critics of foreign investment in New Zealand, saying Treasury has consistently recommended removing all screening.
The British civil servant who arrived in this country 15 months ago told the New Zealand Institute of International Affairs that lowering foreign investment would be counter-productive to growth ambitions.
Small, high productivity economies relied heavily on international connections of people, capital, trade and ideas, he said.
He advocated the reduction of costs and distortions associated with capital inflows, particularly tax.
"If we are to continue to screen foreign investment, and Treasury has consistently recommended removing all screening, it needs to be kept to a minimum and under constant review," he said.
Fashionable
He said it had become fashionable to question foreign direct investment, arguing there was a loss of control of land assets and profits were exported.
The issue was really how the land was used, rather than who owned the land, Mr Makhlouf said.
Regulatory mechanisms governing land use applied to all land owners irrespective of nationality.
"Some of you might have followed the story of the big Swedish furniture outlet called IKEA, and its attempts to find a site for a store in the North Island," Mr Makhlouf said.
The company ran into so many obstacles that it eventually abandoned its plans to establish a New Zealand branch. Domestic policy settings relating to roading infrastructure, the Environment Court process and the approach of the local council managed to sink IKEA’s plans.
"New Zealand requires foreign investment to meet the gap between national savings and national investment. If the idea of foreigners earning a return on New Zealand investment is unpalatable to some, there are two alternatives -- lowering national investment or increasing national savings," Mr Makhlouf said.
A higher rate of national savings would provide New Zealanders with greater scope to own assets that they want to retain control of, and entitle them to any returns on the investment.
Commenting on the world economic outlook, he said the picture was mixed.
"While there are signs the global economy is recovering, there have been some set-backs recently. The recovery is being driven by emerging economies, in particular China and other Asian countries, and there are some additional benefits for New Zealand via Australia."
Activity in the major developed economies has been slower to rebound.
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Comments and questions41
So we now have a Pom running our country - it's bad enough watching TV every night and hearing pommy union leaders.
It might be different if the Poms were investing but they have no money - so what gives them the right to sell down our country.
Deport the lot of them
There are many who advocate foreign investment is good. There has been much foreign investment in NZ in the past. How has it performed. Can anyone produce or point to examples where foreign investment has produced "real benefits" for NZ. There are enough existing foreign investments that can be used as examples or "case studies". But to use IKEA as a broadbrush example is a nonsense. All their stuff is imported. All it would do is provide a few jobs. But the cost of the foreign investment (outflows) would outweigh the jobs benefit.
What I meant to say is - it's all very well for foreigners to come in and make portentious statements extolling the virtues of giving up control (however small) without substantiating them.
A foreigner advocating free-for-all foreign investment. Well, colour me shocked.
The rest of his longer term colleagues at Treasury must be cringing and thinking " what a dork this guy is "
I must agree it is difficult to warm to the idea of significant foreign investment as a good thing - particulalry if the argument is purely based around jobs only. But if you look at the situation India is in, you can see why these chaps are advocates for it. India has significant restrictions on foreign invesment in their country - small and medium size businesses cannot get access to capital and growth is being severly dampened because of it. This in turn has increased the cost of capital to a point where return demands for equity holders are as high as 25%
India is likely to loosen foreign-investment restrictions in its retail sector in coming [url=http://www.racepages.com/]months[/url].
Time to restructure the Treasury?
Hey folks
Stop dissing the guy for being a Pom. How many of you can say you didn't come from pommy stock??? So what if he's only new and you critics have been descended from poms and are 2nd,3rd or 4th or even 5th generation NZers. Let's not get personal here. The issue not about the guy being a foreigner but about the critical issue of growing the NZ economy. How many of you are economists and realise that you need injection of foreign investment and capital to encourage the economy to grow. Using your own capital isn't going to help the country's economy grow in the long term. As stated in his speech, it's not about ownership of land and who owns the land but about how the land is being used. The foreign investment regime - i.e. the OIO should be under constant review to monitor the effectiveness of the OIO's approved foreign investments in growing the economy and to track the economic benefits these foreign investments bring into NZ.
[Also, we can't block investment in NZ if we want Fonterra and other NZ companies to expand their investments in China, India and elsewhere. Quid pro quo - Editor]
Where is the 'Register of Interests' for Treasury staff - including Acting Secretary to the Treasury Gabriel Makhlouf ?
What are his connections, and whose interests is he serving?
How can 'conflicts of interest' be avoided if interests are not declared ?
Declared in a form which makes them readily available for public scrutiny - given NZ's lack of an 'Independent Commission Against Corruption' or the like - who's tasked with PREVENTING corruption and educating the public about corruption?
(Unlike the Police or SFO whose focus is more upon investigation of corruption AFTER the event, rather than PREVENTION ?)
Penny Bright
http://waterpressure.wordpress.com
Dear Mr Editor. IF we want Fonterra and OTHERS to expand in China. Well, yes I would agree, but why dont you do your homework and go and interview Fletcher Construction who was expanding into China in the 1990's, and ask them why they gave up and pulled out.
Penny , the guy says something you don't agree with so therefore you imply corruption.No wonder this country is struggling to get ahead with people thinking like that.
We have had foreign investment from day one in this country and will always need it -- our own capital base is too small.
The example Key gave the other day of Synlait is a classic example -- they tried or looked hard at a public float and saw it would not be successful so went off shore to raise capital and hopefully for them they get better market access as well.
Companies like Sealord have had foriegn shareholders for decades.
It's not ownership of the land but how it's used.
Actually it IS about ownership of the land! You've got China sitting on a huge pile of cash and we're told they might have earmarked $6 billion for investment in NZ. Good God, that would just about buy the whole bloody country! Certainly all the good bits that they are looking for which is the dairy farms and anything that can be used to grow food. Well, bugger me, suddenly NZ's entire exporting industry is no longer NZ's because the Chinese have enough dosh to set up duplicate infrastructure to compete against Fointerra and sufddenly Fonterra is history because all the farms that might be bought by the Chinese will head for a Chinese-owned factory in NZ. NZ just becomes an extension of China. Thanks John Key and National! Sure, they might hire a few people to work the land for them but you can guarantee the profits would be repatriated to China or used to continue the buy-up of NZ. Come on Makhlouf, there's a good reason NZers are against foreign ownership - we've had it since Douglas opened the floodgates and whilst it has worked for the foreign companies who have stripped the profits and run it has not benefitted NZ's economy at all - quite the reverse when you look at the Balance of Payments for the last 25 + years.
Of course Gabriel Makhlouf is right. Anyone who disagrees with him will also be insisting any company in NZ which own assets overseas must sell them, or leave NZ.
Startibarfast -- your senario will only occur if NZers willingly sell everything to foreigners. They cannot just come in and demand a sale, can they??
errr.... no.
I have been raising the need for 'disclosure' of the interests of those responsible for property and procurement for some time.
This is a continuation of the same theme...
Where is the genuine 'transparency' if 'interests' are not publicly disclosed and available for public scrutiny?
Penny Bright
http://waterpressure.wordpress.com
Agree with foreign investment as long as its 'clean" Dont want Mafia money Drug Cartel monet etc etc. Then we will have corruption as this always follows 'dirty"money.
And we dont want dear Penny B to be proved right
Chinaphobia is alive and well in Kiwicomfortland
Can't wait till the election and watch Winnie drum up the Grey Steriles and asian bashers into his Xenny party circus...should be fun.
What about reciprocal rights? If a foreigner wishes to invest in NZ, will we find it just as easy[or hard] to do likewise? Chinese included!
Back from holiday now Penny...so how about answering those questions pertaining to your own transparency and corruption now you little neo-marxist cougar you?
Victrix
Where are you living? NZ is broke. Everyone is over extended. Banks are breathing down farmers necks to reduce debt. Don't fifer the Crafar farms. Of course people will sell land for a quick financial fix. The deep Chinese pickets mean they are unlikely to sell it back again. How about we replicate the Chinese model - JVs, max 49% foreign ownership, can't own the land. What? A foreigner can't own Chinese land?!? Come on Makhlouf, there's your level playing field. Replicate the investment policies of the investor's home country.
Penny your as corrupt as FIFA
Startibartfast -- with regard to land ownership I agree entirely with your last sentence.
Your comments are becoming repetitive and tiresome. It is time the NBR banned your posts. This last one borders on defamation. If you don't have something intelligent to say why not just shut up?
So NZ becomes the Whore House of the Pacific again.
Bring your money - don't care were its from, tax advoidance, gun running, drugs, dictatorship. We don't care.
It is worrying and frightening how many of you are xenophobic. Never forget, the USA was built on (mainly) Brit capital investments, and see where she got to! In 1938 the UK owned some 25% of ALL American assets - and the US was not damaged thereby.Then came the '30-'45 War, and Britain used all those assets, plus all the gold reserves in the Bank of England, to buy munitions to save Europe from Nazi Germany. When Britain became broke, the US invented Lend-Lease, so Britain could continue fighting Germany. Ah Well.
Lindsay Fergusson | Thursday, June 2,
2011 - 9:21pm
Your comments are becoming repetitive and tiresome. It is time the NBR banned your posts. This last one borders on defamation. If you don't have something intelligent to say why not just shut up? "
______________________________
(grumpier) old man Lindsay?
Thought you (used to?) support 'freedom of expression Lindsay?
Or - have you got something to hide perhaps?
Wanting to have my posts 'banned'?
Goodness me - I MUST be on target to cop that sort of flak, from someone with your Business Round Table background.
You and your mates ever seen this?
Eight Traits of the Disinformationalist
by H. Michael Sweeney <
HMS@proparanoid.com>
copyright (c) 1997, 2000 All rights reserved
(Revised April 2000 - formerly SEVEN Traits)
1) Avoidance. They never actually discuss issues head-on or provide constructive input, generally avoiding citation of references or credentials. Rather, they merely imply this, that, and the other. Virtually everything about their presentation implies their authority and expert knowledge in the matter without any further justification for credibility.
2) Selectivity. They tend to pick and choose opponents carefully, either applying the hit-and-run approach against mere commentators supportive of opponents, or focusing heavier attacks on key opponents who are known to directly address issues. Should a commentator become argumentative with any success, the focus will shift to include the commentator as well.
3) Coincidental. They tend to surface suddenly and somewhat coincidentally with a new controversial topic with no clear prior record of participation in general discussions in the particular public arena involved. They likewise tend to vanish once the topic is no longer of general concern. They were likely directed or elected to be there for a reason, and vanish with the reason.
4) Teamwork. They tend to operate in self-congratulatory and complementary packs or teams. Of course, this can happen naturally in any public forum, but there will likely be an ongoing pattern of frequent exchanges of this sort where professionals are involved. Sometimes one of the players will infiltrate the opponent camp to become a source for straw man or other tactics designed to dilute opponent presentation strength.
5) Anti-conspiratorial. They almost always have disdain for 'conspiracy theorists' and, usually, for those who in any way believe JFK was not killed by LHO. Ask yourself why, if they hold such disdain for conspiracy theorists, do they focus on defending a single topic discussed in a NG focusing on conspiracies? One might think they would either be trying to make fools of everyone on every topic, or simply ignore the group they hold in such disdain.Or, one might more rightly conclude they have an ulterior motive for their actions in going out of their way to focus as they do.
6) Artificial Emotions. An odd kind of 'artificial' emotionalism and an unusually thick skin -- an ability to persevere and persist even in the face of overwhelming criticism and unacceptance. This likely stems from intelligence community training that, no matter how condemning the evidence, deny everything, and never become emotionally involved or reactive. The net result for a disinfo artist is that emotions can seem artificial. Most people, if responding in anger, for instance, will express their animosity throughout their rebuttal. But disinfo types usually have trouble maintaining the 'image' and are hot and cold with respect to pretended emotions and their usually more calm or unemotional communications style. It's just a job, and they often seem unable to 'act their role in character' as well in a communications medium as they might be able in a real face-to-face conversation/confrontation. You might have outright rage and indignation one moment, ho-hum the next, and more anger later -- an emotional yo-yo. With respect to being thick-skinned, no amount of criticism will deter them from doing their job, and they will generally continue their old disinfo patterns without any adjustments to criticisms of how obvious it is that they play that game -- where a more rational individual who truly cares what others think might seek to improve their communications style, substance, and so forth, or simply give up.
7) Inconsistent. There is also a tendency to make mistakes which betray their true self/motives. This may stem from not really knowing their topic, or it may be somewhat 'freudian', so to speak, in that perhaps they really root for the side of truth deep within.
I have noted that often, they will simply cite contradictory information which neutralizes itself and the author. For instance, one such player claimed to be a Navy pilot, but blamed his poor communicating skills (spelling, grammar, incoherent style) on having only a grade-school education. I'm not aware of too many Navy pilots who don't have a college degree. Another claimed no knowledge of a particular topic/situation but later claimed first-hand knowledge of it.
8) BONUS TRAIT: Time Constant. Recently discovered, with respect to News Groups, is the response time factor. There are three ways this can be seen to work, especially when the government or other empowered player is involved in a cover up operation:
1) ANY NG posting by a targeted proponent for truth can result in an IMMEDIATE response. The government and other empowered players can afford to pay people to sit there and watch for an opportunity to do some damage. SINCE DISINFO IN A NG ONLY WORKS IF THE READER SEES IT - FAST RESPONSE IS CALLED FOR, or the visitor may be swayed towards truth.
2) When dealing in more direct ways with a disinformationalist, such as email, DELAY IS CALLED FOR - there will usually be a minimum of a 48-72 hour delay. This allows a sit-down team discussion on response strategy for best effect, and even enough time to 'get permission' or instruction from a formal chain of command.
3) In the NG example 1) above, it will often ALSO be seen that bigger guns are drawn and fired after the same 48-72 hours delay - the team approach in play. This is especially true when the targeted truth seeker or their comments are considered more important with respect to potential to reveal truth. Thus, a serious truth sayer will be attacked twice for the same sin.
I close with the first paragraph of the introduction to my unpublished book, Fatal Rebirth:
Truth cannot live on a diet of secrets, withering within entangled lies. Freedom cannot live on a diet of lies, surrendering to the veil of oppression. The human spirit cannot live on a diet of oppression, becoming subservient in the end to the will of evil. God, as truth incarnate, will not long let stand a world devoted to such evil. Therefore, let us have the truth and freedom our spirits require... or let us die seeking these things, for without them, we shall surely and justly perish in an evil world.
That will kill off the debate. No one is going to read past that to get to this comment.
This is so off topic it is pathetic.
In response to Penny Bright | Thursday, June 2, 2011 - 11:30pm
That will kill off the debate. No one is going to read past that to get to this comment.
This is so off topic it is pathetic.
Anonymous | Friday, June 3, 2011 - 12:18am "
__________________________________
Exposed as another 'Disinformation' agent?
Of course - being 'Anonymous' how would anyone know who you were?
Thanks for helping to prove just how 'ON TOPIC' was the :
'Eight Traits of the Disinformationalist
by H. Michael Sweeney <
HMS@proparanoid.com>
copyright (c) 1997, 2000 All rights reserved
(Revised April 2000 - formerly SEVEN Traits)"
errrr..... An attempted anonymous smear campaign hardly qualifies as 'debate'?
'Anonymous/GUTLESS?''
Penny Bright
http://waterpressure.wordpress.com
Penny is it possible for you to consider the idea that an NBR forum is not the appropriate vehicle for your political campaigns?
In response to Penny Bright | Friday, June 3, 2011 - 8:19am
Penny is it possible for you to consider the idea that an NBR forum is not the appropriate vehicle for your political campaigns?
Farmer Brown | Friday, June 3, 2011 - 8:43am "
_________________________________
It seems that a growing number of NBR readers are supportive of the campaign for 'open, transparent and accountable' local and central government?
I use the election process to help draw attention to these matters.
So 'Farmer Brown' - yes I've considered your idea - but I don't agree with the concept that the NBR forum is not the place to discuss what I believe to be significant political matters.
Thank you for asking.
Penny Bright
http://waterpressure.wordpress.com
I don't usually support Farmer Brown, but I do think that Penny is threatening the openness and immediateness of the NBR discussions with long and not always relevant postings. NBR discussions are a valuable open forum, and it would be a shame if they had to be mediated and filtered to prevent this abuse. Ed, perhaps the online form needs a character limit to prevent these long, rambling postings.
Penny...so how about answering those questions now you little neo-marxist cougar you?
Victrix
Penny's unpublished book, Fatal Rebirth: the story of one woman's struggle to push subjective lefty pap in a world of objective reality.
I leave her with the last two words of my as yet unpublished tome 'Living life to the full whilst making a ton of moollah and having a fabulous sex life with my hot Kiwi husband':
Foxtrot O$car
HAHAHA a communist wrtiting this Truth cannot live on a diet of secrets, withering within entangled lies. Freedom cannot live on a diet of lies, surrendering to the veil of oppression. The human spirit cannot live on a diet of oppression, becoming subservient in the end to the will of evil. God, as truth incarnate, will not long let stand a world devoted to such evil. Therefore, let us have the truth and freedom our spirits require... or let us die seeking these things, for without them, we shall surely and justly perish in an evil world'.
Classic.
this policy actually makes a lot of sense if some of us can control our xenophobic tendencies -but I'm not holding my breath!
liberte
I've answered your questions you little 'disinformation' agent / attempted smear campaigner you :)
But keep going!
Just proves I'm 'on track' - or you wouldn't be bothering.
(yawn............)
Penny Bright
http://waterpressure.wordpress.com
Coming back on track of foreign investments and Mr Makhlouf's comments - there needs to be change to the overseas investment legislation and the OIO is not fit for purpose as it takes too long to process applications but under the guise of thorough processing. It turns out that there's duplication of their services in investigating overseas investors for good character - they are doing the same tasks as the SFO and other government agencies e.g. Companies Office investigating directors for good character. In fact the OIO (see the Natural Diary news articles) refers their cases during their own investigation to the SFO. So if the government is truly wishing to cut public sector cuts - the OIO should itself be reviewed as to whether it is necessary for some of the work it says it needs to do. The OIO should be disbanded and a better fit for purpose foreign invesment unit set up. This can easily be done at less cost to the government than to maintain a unit that hides under so much bureaucracy, it's costing foreign investors as the processing delays are financially crippling.
he makes a lot of sense
but the real problem is the reserve bank policy of extremely low interest rates which discourage savings
rates should be increased to encourage savings and grow investment capital
liberte
he makes a lot of sense
but the real problem is the reserve bank policy of extremely low interest rates which discourage savings
rates should be increased to encourage savings and grow investment capital
liberte
Penny,
your brain is worth a penny as your name suggests- good name!
......why don't you look beyond your back yard?
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