It’s great to hear Phil Goff announce that a Labour government won’t let overseas interests to own more than 25% of monopolistic companies, like ports and airports, and farmland. In the new world economy we’re moving into, a global scramble for vital natural resources like farmland, we need to keep the foundations of our economy in Kiwi hands. This brings Labour much into line with where are Greens are.
Now, I don’t have any problem with foreign ‘investment’ in the true sense – that is, an overseas company using its money to build something of value in New Zealand, or loaning money for New Zealanders to do that. Selling our natural assets though, that’s something different. There’s no real investment there. We get some cash up front but lose the profits from the farmland, or minerals, or whatever, and we lose control over how they’re used. So, I completely agree with Goff that overseas interests wanting to buy farmland will have to show that the purchase will result in a real investment that creates new jobs and exports for New Zealand.
The argument against letting overseas owners control companies with monopoly power is obvious because we’ve been through it with the privatisation of rail and Telecom. An overseas owner has no interest in the broader economic health of New Zealand, only in maximising profits in the short-term. Time and again, foreign owners asset strip knowing the government will have to bail them out because of the broader economic damage collapse would entail.
Internationally, we’re seeing a scramble for natural assets. Led by China, the scramble is born from awareness that climate change, resource depletion, peak oil, and estimated population growth of a further 2 billion in the next forty years adds up to a world where there is not enough to go around. In this environment, New Zealand, with its big water, arable land, minerals, and (potentially) oil is a juicy target. That’s why we’re seeing a Chinese state-owned company, masquerading as ‘Natural Dairy NZ’, attempting to buy the Crafar Farms while the Canadian state-owned Pension Fund tried to buy Auckland airport. They see the need to secure natural assets and transport nodes now.
Are we really going to be so stupid enough to sell crucial assets that the rest of the world is in a race to get hold of? Are we so short-sighted that we would let ourselves become have-nots in a resource-constrained world? Not if Labour and the Greens get their way.