Government urged to send clear signal that New Zealand welcomes foreign investment
NZIBF - 10 April 2012
Foreign investment is vital to the health of the New Zealand economy, says the NZ International Business Forum.
“Without foreign direct investment NewZealand lacks the capital to fund export-led growth. Foreign investment is what plugs the gap in our low domestic savings rates. Without it, ratings agencies could react by increasing New Zealand’s (already high) credit risk rating and interest rates will rise” says NZIBFChairman Sir Graeme Harrison.
The New Zealand International Business Forum is a grouping of leaders from the country’s largest internationally focused businesses and the major business associations. NZIBF members represent economic interests with a turnover in excess of NZ$20 billion.
Sir Graeme said that Ministers considering the Shanghai Pengxin bid to buy the Crafar Farms needed to send a clear signal that New Zealand welcomes foreign investment.
“Foreign investors are prepared to respect the rules but they need predictability and certainty that when conditions are complied with, the investment will be able to proceed. That is why the current uncertain situation with regard to the Crafar Farms is so negative for New Zealand’s interests. It risks detracting from New Zealand’s attractiveness as an investment destination at a time when there is strong competition for foreign investment from other countries”.
Sir Graeme also said that NewZealand’s relationship with China was important to the country’s future growth.
“Growing foreign investment from China has been rightly signalled as a major objective by the Government in its recently released NZ Inc China Strategy. It is hard to see Chinese investors coming to New Zealand if they can’t be sure they are welcome. The Government needs to use this opportunity to reaffirm that foreign investment is welcome from all sources”.
Sir Graeme called for bi-partisan support for an open and welcoming foreign investment regime.
“Both major parties are committed to growing the economy through increased exports and international business. Attracting foreign investment is a critical element in the policy mix. Without foreign investment New Zealand as a whole will be poorer”.