Save whose farms from what?

A group of Aucklanders wants to Save The Farms .

Not from pests and diseases, high rates bills, compliance costs and a myriad of other real threats. They want to save us from the perceived threat of foreign ownership.

Rather than saving our farms, StF is threatening them.

It is an incorporated society whose purpose is to:

  • Maintain ownership by New Zealand citizens of all agricultural and sensitive land and land of cultural importance.
  • To gain an immediate Moratorium on the sale of this land to foreign investors.
  • To promote and stimulate informed public debate around these objectives in a non political and partisan manner.
  • To promote a revision of the Overseas Investment Act 2005.

To this end they want the government:

  •  to put a moratorium on the sale of the Crafar farms and other sensitive agricultural land.
  •  to give urgency to the proposed review of the Overseas Investment Act 2005 incorporating a robust programme for public submission as announced by the Prime Minister.
  • The moratorium on the sale of sensitive agricultural land remains until the review of the Act has been completed.

This is a direct attack on property rights and farm values.

What do they mean by “our” farms anyway?  The only farms which might be considered “ours”  are those owned by Landcorp.

The rest aren’t “ours”. They are the property of the many individuals, trusts, companies and other bodies who have purchased the land.

Excluding foreign buyers would have an immediate and negative impact on the price of farmland. Other would-be purchasers might enjoy that but would-be sellers and the hundreds of other land owners whose farms’ values would plummet, and their creditors, would not.

What makes farms special or different from commercial or residential property, businesses and companies that all foreigners should be prevented from buying it?

Around 80% of our forestry is foreign-owned as are many other companies operating here including several vineyards and wineries and hotel chains. A Chinese company has a big stake in PGG Wrightson which gives them access to PGW’s intellectual property in seed development.

Most of our banks are foreign owned and their policies and operations impact on the day to day life of New Zealanders directly in a way that farms do not.

The Overseas Investment Act  already requires vetting of would-be purchasers of more than 5 hectares of non-urban land.

Regardless of who the owners are they can’t take the land with them and are subject to the same laws and regulations governing what they can do with it as everyone else.

Bernard Hickey says SOF’s is a myopic, xenophobic campiagn which needs debating.

I agree with his adjectives and think a discussion on the facts would be helpful. It could start with a KPMG report which found:

  • There is no evidence that New Zealand is experiencing an unusually high level of foreign investment in agricultural assets.
  • No justification for significant changes to the overseas investment rules . . .
  • KPMG’s Head of Agribusiness, Ian Proudfoot says: 

    “As a small, developed economy New Zealand has always required inbound investment to support the standards of living we are now accustomed to, and this holds true even in the current environment. The agricultural sector in particular lacks sufficient equity to take advantage of the opportunities available to it and foreign investment offers the potential for us to maximise the value of our land. Events of the last year have demonstrated we are not always able or prepared to finance these opportunities from our own resources.

     “The high price of quality agricultural land in New Zealand and our remoteness to the rest of world means that even with the natural benefits of water and the link product has to New Zealand’s sustainable brand we are unlikely to be top of the list of preferred destinations for most international land investors currently looking for opportunities,” says Mr Proudfoot.

    In other words there is no need for SoF’s campaign because in spite of perceptions to the contrary, New Zealand farmland isn’t particularly attractive to foreign investors.

    Given that and our need for capital, those who want to come here should not be discouraged without good reason and not being citizens is not by itself a good reason.

     It is better for farming and New Zealand to allow, or not, sales of farm land to foreigners on a case by case basis than to cut off the investment and ideas which can mean foreign owners give far more to New Zealand than they take.

    The threat of foreign ownership is a perception, the threat to farms and their owners from a blanket ban on foreign ownership is real.

    8 Responses to Save whose farms from what?

    1. “The threat of foreign ownership is a perception”
      John Key himself has expressed his personal concern that selling our farmland and thus becoming tenants in our own country is a real issue we are facing.
      Are you calling him a liar?

    2. homepaddock says:

      Aboslutely not Robert. John acknowledges people are concerned but he also said the campaign goes too far:
      http://tvnz.co.nz/business-news/anti-foreign-ownership-campaign-launches-3725471

      ‘While selling farms did not achieve a lot, he had problems with a total ban on sales.

      “Why wouldn’t it be no sales of beach houses and no sales of vineyards? So you can take this thing too an extreme position which I don’t think the bulk of New Zealanders would support.” ‘

    3. gravedodger says:

      One issue that foreign investment in any New Zealand assets exposes us to is the access to commercial information and intellectual property gained by people and other entities who are in direct competition with us and have no regard for the protections that international law and convention is supposed to provide.
      One outcome was the adulteration of our iconic Fonterra brand by the Sun Lu milk company with Malamine. I doubt that Chi Com companies have a very high regard for normal business protocols.
      Any Land purchased by any foreign entity leaves that land still part of our geography and subject entirely to our laws so the only outcome for what these totally ignorant people propose will be as you and others point out, the collapse of our land values, loan securities and retirement funds of the many, who like me and Mrs GD, invested everything we ever earned over and above our living and entertainment costs in our farms as an intended retirement scheme. We took this path in the knowledge that off farm investment, although often recommended by advisors and “experts”, did not suit our belief that we were very capable of making decisions that, although exposing us to higher risk, were comfortable for us. A stupid call such as the aims of these muppets is a major reality check how we under estimated risk as we needed a totally unregulated market allowing us to sell when it suited us to retire.
      The purchaser of our last commercial farm property was a POM and I shudder to think what ignorant and economic luddite attitudes such as these could have wrought on our very well planned ( as we thought) personal retirement plan.

    4. robertguyton says:

      “John”?
      Jeeze Ele – are you married to him?
      He’s pulling the wool over our eyes anyway, expressing concern where there really is none. Key only pretends to be concerned that land remains in the hands of New Zealanders and then only because his polling told him that there is grass roots concern. You are supporting his and Federated Farmers desire to sell to the highest bidder. Gravedodger, to his great credit, seems less convinced.

    5. homepaddock says:

      GD – I agree brandNZ is something we need to protect and your example is a good one of the dangers a blanket ban would pose.

      Robert – you’d rather I call him Mr Key?

      What’s wrong with the OIC considering would-be purchasers on a case by case basis?

      We have friends who are foreign-owners. Their investment isn’t just financial, they’re making valuable contributions to farming, their communities and NZ.

    6. robertguyton says:

      Call him what you will, Ele, I know I do.

      “What’s wrong with the OIC considering would-be purchasers on a case by case basis?”

      Nothing at all Ele (did I hear someone whisper ‘death by a thousand cuts’?)

    7. gravedodger says:

      RG I am puzzled whether you need to revisit comprehension 101 or I need to do written expression 101 again but I suspect the latter.
      I have absolutely no problem with any foreigner buying our farmland as in almost every case in my knowledge zone they are better stewards of the land than far too many of our longterm citizenry. I only ask that they act as new arrivals and fit in with the culture they have chosen to join and allow their culture to slowly apply change to ours not overwhelm it.
      They are almost without exception far more committed to protection and improvement of their asset and are open to innovation and open minded attitude to alternative land use. I accept that they often have a desire for privacy and exclusive use but that is no greater than my own attitude to the privacy that freehold title infers on my own land. That is why we moved back out to a rural block up a steep drive and built in the geographic center of the section.
      Why some people, with too little real knowledge of, and attachment to our rural land, have such a strongly held opinion about keeping out foreigners when every single citizen is an immigrant, the descendant of them or an overstayer, is arrogance IMO.
      There is a more than a smell of xenophobia about the current outcry in relation to the Crafar Farms and my position on the disposal is no secret but I am still incensed by what Ms Clark and her side kick Mr Cullen did to the shareholders in AIA when the Canadian Pension fund tried to invest in our main airport. Governments should be much more aware of the damage they do to well laid plans of ordinary people, who in full cognition of the law and commercial risk factors make significant economic decisions, and when they respond in a kneejerk reaction to public sentiment change that is too often predicated on a completely false claim made by people often armed with nothing more than an entrenched political agenda or in the current case of our rural land, blatant racism.

    8. You’ve not had any experience with some of our Southland dairy farmers, recently emigrated from the Netherlands then Grave.

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