The potential sale of the 14,000ha Lochinver Station (a "ridiculously small amount of land" according to Steven Joyce) to foreign interests raises a couple of important questions.

First, if we continue to sell tens of thousands of hectares of farm and forestry land into offshore ownership every year, at what point will this supposedly insignificant percentage of our productive land become significant?

Second, once this landholding becomes significant (as it will eventually), what will the effect be on our economy (profits being taken offshore, a potentially smaller tax take) and society (reduced land ownership by our own people, more "tenants in our own land")?

At present the only control on foreign land sales appears to be the Overseas Investment Office (OIO) with their supposedly stringent regulations.

Advertisement

These same regulations allowed the sale in Northland of a coastal property in an area of significant natural beauty bordering Department of Conservation-owned land, to a Russian magnate. This was on the grounds of enhancing the environment and the supposed fact no local buyer would be in a position to keep the property intact without subdivision.

A large residence has been built on the beachfront and a subdivision plan for the surrounding ridges has been approved by the Whangarei District Council with no action from the OIO.

It is disingenuous to compare the Crafar Farms with Lochinver Station.

The Crafar farms appeared to be in poor condition at the time. It is drawing a long bow to suggest any subsequent increase in performance could have come only from foreign ownership, rather than if the farms had been sold individually to competent, well-resourced Kiwi farmers, or in a block to an experienced New Zealand entity such as Landcorp.

The supposed benefit of this foreign investment was to allow the Australian-owned BNZ Bank to recover money it had lent to Allan Crafar. It is hard to see the net benefit to "NZ Inc" in that sorry saga.

Lochinver is a different proposition. It has been in the same ownership for decades and has been well-managed, with ongoing investment and maintenance.

Any great gains to be made in production are unlikely. I would suggest the attraction of this property is due to its contour and size, for conversion, in part, to a large-scale dairy farm.

Whether adding to our agricultural economy's increasing reliance on dairying and allowing the purchaser to add to their vertically integrated investment in this country is in the national interest is a moot point. If we don't accurately collect the data on land sales and make no attempt to analyse the net effect on our economy and society, any debate on the subject will be uninformed, as at present.

Advertisement

Allowing the debate to get sidetracked by whether it is a xenophobic reaction to the Chinese is not helpful. The question should be whether large-scale sales of land to offshore interests from any region deliver a social and economic benefit to New Zealand.

If responsibility for regulation lies solely with the OIO, with their blinkered view of looking at each individual transaction on its supposed merits, we might reach the point when the percentage of land in foreign control becomes "significant" far sooner than expected. By then it will be too late if we discover the net effect is not as advantageous to our nation as those in favour would have had us believe.

Richard Duley and his wife Christina run a family-owned rural supplies business in Kawakawa.