How do we position ourselves to make the most of Chinese investment?

When one of China's most powerful businessmen tells the "New Zealand Story" better than Kiwis — is it time to take notice?

Just a fortnight ago, Jack Ma did just that when he played host to the Prime Minister and a visiting New Zealand business delegation over lunch in Beijing.

Ma was charismatic. Eloquent. Perceptive. Particularly, when this self-styled "citizen of the earth" set about positioning New Zealand and thanking the delegation "for your benefit to the whole planet".

There was more. Twenty of Ma's former colleagues at China's e-commerce giant loved New Zealand so much they have retired here.

Advertisement

With $100 billion of wealth in the room at the China Entrepreneur Club-hosted event it was good advertising.

Ma chairs the club which includes fellow billionaires like Guo Guangchang, China's answer to Warren Buffett, and, property tycoon Wang Jianlin, who also owns 20 per cent of Spanish soccer team Atletico Madrid.

The event provided an interesting window into how wealthy Chinese see New Zealand.
And an insight into what drives so many to come here.

"Your population is 4.5 million and we've got 1.4 billion people so the market is huge," the Alibaba founder said. "I think our cities are already demanding a quality that will scare you guys.

"So that is something that we would love to do. Not only buy from New Zealand but we should learn from New Zealand how to protect the environment and then continue to do that."

Fonterra chairman John Wilson later told the Herald that Ma provided a lesson about the importance of looking "outside back into New Zealand, rather than what we tend to do which is to 'look inside out'."

Wilson agrees the opportunities from the China relationship are immense. "But crikey, it's certainly going to put some challenges on New Zealand.

"We're four million people and the interest is quite extraordinary, and on one level that's very, very good," he says.

"But on another level it certainly does create some real stresses and strains and probably some quite unusual outcomes that are going to take some thinking about — but more importantly from time to time are going to have some impacts."

As a citizen of the earth I would like to thank New Zealand for your benefit to the whole planet... the earth is fortunate to have a country like New Zealand, we must embrace this. You should not only buy from New Zealand but should learn from New Zealand. It has great people, education, environment, technology.

SHARE THIS QUOTE:

Those impacts are being felt at the high end of the New Zealand residential property market; through snowballing tourism numbers and the keen interest now being shown by Chinese investors in targeting high-value and consumer-related sectors.

There is pressure on New Zealand's infrastructure.

More hotels need to be built to accommodate the tourists. And — whatever the politicians say — more houses.

Major trend shifts are also swiftly impacting on the way business is done in China. It now has the world's most sophisticated e-commerce market and is building a massive internal port in Xian as part of the "One Belt, One Road" initiative to open physical trade routes to Europe and throughout Asia and the Pacific.

Chinese investment now makes up only $6 billion of NZ's total foreign direct investment, but it is growing fast.

Chinese investors are across a range of sectors: agribusiness, hotels, farms, household appliances, dairy, waste management, health products, tourism and meat.

Wilson says the question is how does New Zealand position itself to grab the opportunity right throughout all of the touch-points — "whether it's from tourism right through to food, that's the opportunity.

"We've got to think about a lot more, look through their lens. That's why online is so critical to us and our growth, and hence the partnership with (Chinese infant formula player) Beingmate," he added.

A senior official later observed that underpinning the Ma message was the huge drive by Chinese consumers for "goodness"; quality products and services that they can trust.

"However Jack was going beyond just products and services and talking about the need to protect the planet as a whole and he saw New Zealand as a key part of this equation."

Wilson also pointed to a shared natural affinity.

"A lot of people are very interested in New Zealand and so we're seeing more flights, we're seeing more tourism and that has an impact on our infrastructure more generally.

"Of course you've also got, from a relativity perspective, the amount of capital that's interested in investment in New Zealand, in a whole range of disciplines, everything from property right through to really interesting technology projects — ICT, education — the impact of that is interesting.

"What struck me, sitting there and listening to the people around me at the table yet again reinforced that genuine interest in New Zealand.

"And it's because, I think there is a naturalness and confidence about the relationship that's naturally maturing.

"But with it will come some challenges and some stresses and some strains, of course."