Foreign investment in land low priority- farmers

By Ben Chapman-Smith

A new survey shows restricting foreign investment in rural land is seen as low priority by industry leaders. Photo / NZH
A new survey shows restricting foreign investment in rural land is seen as low priority by industry leaders. Photo / NZH

Leaders in the agriculture sector believe restricting foreign investment in rural land is a low priority issue, according to a new survey.

KPMG's Agribusiness Agenda 2012 asked 98 leaders in the industry to rank a series of topics as either low or high priorities.

The Crafar Farms sale has pushed the issue of foreign direct investment (FDI) in agricultural land to the top of the news agenda recently.

But when leaders were asked about this sometimes emotionally-charged issue, foreign investment rated the lowest in priority at number 23.

Adoption of genetically modified technologies was also a low priority.

"This possibly reflects a belief from industry leaders that investing time and effort in these areas is unlikely to achieve much," said Ian Proudfoot, KPMG head of Agribusiness for Asia Pacific.

"Debate on these matters is rarely based on scientific fact or economic reality, but subjective opinion and political dogma."

A summary of leaders' feedback showed concern that continued uncertainty around the criteria an overseas investor would need to meet in order to invest in land would impact on potential investors.

Investors would naturally want a stable environment, Proudfoot said.

Leaders also told KPMG that despite investment from British, German, American and Canadian groups, public debate has focused on Chinese investors.

"This tends to suggest the debate has been driven by fear of the unknown, rather a staunch belief that New Zealand gains no benefit from FDI," Proudfoot said.

"As one industry leader put it to us: if the debate is not resolved soon and FDI dries up, this will have a material impact on land values and a consequent impact on debt levels the banks can advance."

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