Minister cautious about rule changes for wealthy migrants

Steven Joyce says the Government is open to changing requirements around investor visas.

Calls for more wealthy migrant capital to be channelled into productive assets have some merit, but New Zealand must also avoid putting off high net-worth investors from coming here, says Economic Development Minister Steven Joyce.

Almost $4 billion is set to be invested in this country through the current investor visa programme, which launched in 2009.

But around 80 per cent of migrant investor funds currently end up in government and corporate bonds, according to a paper published by professional services firm KPMG.

Andy Hamilton, chief executive of business incubator The Icehouse, said this week that at least 10 per cent of wealthy migrant capital should go into growth investments such as angel investment, venture capital or private equity growth funds.

Changing the settings could bring in $50 million to $100 million annually for New Zealand growth companies, Hamilton said.

Joyce said the Government was open to changing the requirements around investor visas.

"The balance will be in to what extent you can direct that investment without putting people off," he said. "It's a balancing act."

Joyce said all investment into New Zealand, including bonds, was positive.

"It's just that some is more active than others and has the potential to create more spillover benefits."

Immigration Minister Michael Woodhouse said on Monday that the Government's recently approved Investment Attraction Strategy signalled a review of migrant visa categories to ensure they were attractive to entrepreneurs and investors.

"I've asked my officials to provide advice, including considering incentivising more active investment," Woodhouse said. "I expect to receive that advice in November so won't be speculating on any possible future changes until I have considered that advice."

Applications for Australian investor visas have slumped since a rule change was introduced in July, according to the Financial Times.

The newspaper reported that just seven visa applications had been received since the new requirements - which require some investment in growth assets like venture capital - came into force.