John Key struck an odd note when he observed last week that he would be concerned if large tracts of New Zealand land were being sold to foreign investors. "Looking four, five, 10 years into the future, I'd hate to see New Zealanders as tenants in their own country, and that is a risk, I think, if we sell out our entire productive base, so that's something the Government will have to consider," he said.

Was this the same Prime Minister who, two months ago, reprimanded his Agriculture Minister for saying the sale of the Crafar family farms to a Chinese company was unlikely to go through? Mr Key has obviously discerned a groundswell of concern about such sales. Yet, as a Weekend Herald investigation revealed, we are already selling large tracts to overseas investors.

Foreign investment involving agricultural land more than twice the size of Auckland City has won regulatory approval over the past five years.

Consents granted under the Overseas Investment Act allowed at least 24 countries to invest in a range of activities from sheep farming to viticulture. The biggest year for Overseas Investment Office consents during the period was 2006, with 67 approvals covering 48,531ha, although last year was not far behind.

That suggests the bid to buy 16 farms from the receivers of the Crafar empire is attracting an untoward amount of attention. This country's low-cost agricultural land has always offered value for international investors.

By far the biggest interest over the past five years has been in land suitable for sheep and beef cattle farming.

But the bid for the Crafar farms by Chinese investors UBNZ, fronted by Auckland businesswoman May Wang, is not the first for dairying land and will not be the last.

Why, then, the angst over the Chinese offer, which has been sufficiently widespread to tweak Mr Key's antenna? Part of this undoubtedly relates to the fact that New Zealanders can only lease land in China. Why allow the Chinese to buy our land? That point must, however, be balanced against other considerations.

First, New Zealanders can buy land in most regions, and have done so in the Americas, Australia, South Africa and Europe. Secondly, and most apposite, foreign investment has always been a driver of this country's economy. Banning the sale of farm land would send entirely the wrong message to potential investors. Thirdly, placing restrictions on such investments is always apt to create considerable difficulties in terms of boundaries and interpretation.

As it is, non-urban land of five hectares or more is deemed sensitive, and applicants must refer their bids to the Overseas Investment Office. It must consider criteria including relevant business experience, financial commitment to the investment and good character. The office decides about 75 per cent of applications, but all those for sensitive land must go to the Ministers of Finance and Land Information. In the end, they must balance the protection of sensitive assets with the need to encourage investment.

By and large, this process has worked satisfactorily. The glib, if nonetheless true, view that land cannot be uprooted and taken overseas does not open all doors.

The contribution to the economy of efficient foreign or multinational ownership has, rightly, been the paramount concern. Indeed, the Government's confidence in the system has seen it delegating more authority to the Overseas Investment Office. Mr Key may have been stricken by sudden doubt, but there seems no reason for dramatic change. Those spreading wildly alarmist sentiment misunderstand the factors underpinning this country's farming success story.