Brian Rudman: Racism clouds land-sale debate

Almost half of New Zealand's wine production and more than 70 per cent of forestry plantations are in foreign hands. Photo / Sarah Ivey

John Key has every right to get a bit twitchy when our newest imperial "best friend" starts talking of trading our farm lands while dangling the latest in broadband technology before his eyes.

He only has to ask his Ngati Whatua neighbours in Parnell what happened when their ancestors succumbed to the gleaming trinkets Great Britain's emissary, Governor Hobson, handed over in return for the land that became Auckland - 10 iron pots, 50 blankets, 91m of gown material and sundry other temptations.

Now, as three years ago when the sheikhs of Dubai came shopping for Auckland's airport, there's a whiff of xenophobia in the air, blurring the debate over foreign ownership of rural land.

It bubbled up with news that a Chinese-backed company was bidding for the infamous Crafar farm empire. As Property Council chief executive Connal Townsend delicately phrased it, the offer "appeared to have tapped a racist vein".

The Crafar farms cover 7800ha, which for a city home-owner, seems a vast estate. But if the Campaign against Foreign Control of Aotearoa have got their sums right, it's not much more than a fly spot on the more than one million hectares of land already in foreign ownership.

Indeed, about 7 per cent of our commercially productive land area has overseas owners. And that was as of 2005. Overseas Investment Office figures in last Saturday's Weekend Herald recorded that in the five years since then, an additional 150,248ha of agricultural land went into overseas ownership.

The top three purchasing nationalities were the UK, Italy, US - each buying between 34,000ha-40,000ha, then Israel (26,132ha) and Australia (11,705ha). Looming large in the Israeli portfolio is the iconic Walter Peak station and its 25,758ha Crown pastoral lease.

While the Chinese "problem" centres around fears of their getting a toehold into the lucrative dairy industry, there's been less of a flurry over the international takeover of our glamour wine industry.

Last October, when US-owned Foley Family Wines bought NZ Wine Fund (59.85 per cent NZ-owned), Winegrowers chief executive Philip Gregan noted that sale meant nearly half of the country's wine production was in the hands of overseas companies. Lincoln University's professor of farm management and agribusiness, Keith Woodford, goes further, calculating that because the surviving New Zealand-owned vineyards are the smaller ones, "on a volume basis about 70 per cent is foreign-owned".

Our forest plantations are even more alienated, says Professor Woodford, blogging in April that, by his calculations, about 72 per cent of pine forests were foreign-owned as of 1999, with US companies owning 35 per cent and Asian companies about 12 per cent. He says that since then, off-shore plantation ownership "appears to have further increased".

Calling for an informed debate "as to whether this is the way we want to go", he says we need a clear policy either way, and one that is "applied on an equal basis to citizens of all countries".

Greens co-leader Russel Norman says a ban on overseas ownership of land would be "a great thing" because it would stop the price of land being driven upwards out of the reach of New Zealanders. The cynic in me would say this is the very reason that Federated Farmers, until now at least, have been rather sanguine about the so-called "problem".

They've adopted the "can't take the land with them" approach. And as landowners, they have every reason to want to farm their property for the capital gain a booming real estate market will eventually deliver them.

One could also point to the Crafars, and their endless battles with the authorities over their husbandry short-comings, and suggest that being born a New Zealander doesn't automatically make you a better steward of the land. Or, for that matter, a more generous one.

In the past couple of years, Aucklanders have had much to thank at least two foreign landowners for. United States billionaires Julian Robertson and his late wife Josie developed luxury resorts and golf courses at Cape Kidnappers and Kauri Cliffs near Kerikeri, and invested in vineyards. Two years ago they gifted 15 modern painting masterworks worth $115 million to Auckland Art Gallery.

Before that, Swiss national Pierre Chatelanat and his wife Jackie gave their 843ha Kaipara Harbour farm to "all New Zealanders" for a reserve.

Around the world there are different approaches to the issue. Last month, Brazil announced plans for a ban on further foreign investment in farmlands, "because of food security". In neighbouring Uruguay, the welcome mat to all comers remains out, and even New Zealanders have taken the plunge.

In China, says Professor Woodford, they "would not look favourably on any land investment that did not also involve major investment in new technology". He suggests that could be the starting point for a New Zealand debate.

It seems as good a place as any. But let's try and keep the xenophobia down to a low buzz while we're at it.