Brian Rudman: Foreign buyers a modern reality

What John Key hasn't confronted is why the protest concentrated on the 16 Crafar farms and not the 72 farms that were sold. Picture / Sarah Ivey

At moments like this, Prime Minister John Key must be wondering why he ever came back from his little piece of New Zealand-owned paradise in Hawaii. Not only does the latest 3News Reid Research poll suggest that his long honeymoon with the New Zealand voter is finally starting to wear thin. It also suggests he's stuck in the headlights with nowhere to go as far as the Crafar Farms saga is concerned.

The poll has 76 per cent of voters wanting tougher restrictions on sales of land, including farms, to foreigners. This includes 68.7 per cent of Mr Key's National Party supporters, 81 per cent of Labour and Green voters and 95.7 per cent of the Winston Peters' faithful in New Zealand First.

This comes hard on the heels of Justice Forrie Miller's decision last week to send the Crafar sale back to the Overseas Investment Office and the two relevant government ministers for reconsideration. It was a huge spanner in the works for the government, which now finds the public distaste for selling off land to foreigners - and Chinese foreigners in particular - spilling over into the debate over the planned partial sale of various state owned energy assets.

Even with the government trying to dampen fears that the energy shares will rapidly flow offshore by hinting at a sweetheart arrangement for mum and dad New Zealanders, which would encourage us to hang on to our new shares, and not immediately sell them on to foreigners for a quick profit, opposition to asset sales perseveres.

Justice Miller's new interpretation of the law regarding the sale of land packages worth $10 million or more to foreigners, is the new owner must demonstrate that they will bring benefits to the economy, over and above what a local buyer could do, all things being equal. That the present farms were run down and would be brought up to a higher standard by the new Chinese owners was not enough, said the judge. The judge said a local purchaser could do that as well. What the law requires, is that a foreign buyer must offer additional benefits, which a local purchaser could not.

If that becomes a hurdle too high for the Chinese to leap, this ruling would at least get the New Zealand public off Mr Key's back, but he would then have to deal with the possible wrath of the Chinese, our most important trade partner.

In reaction to the poll showing overwhelming demand for tougher laws against sales of land to foreigners, Mr Key said in the last 18 months there had been 72 sales of farms to foreign buyers out of a total pool of 10,000 dairy farms and 35,000 sheep and beef farms. He also argued that New Zealand was actually "quite a difficult place to buy land if you're a foreigner".

What he hasn't confronted is why the protest has been concentrated on the 16 Crafar farms and not the 72 farms that were sold. It's hard not to see this targeted opposition as anything other than a visceral reaction to the idea of Chinese ownership.

It's ironic then to discover the government has plans to abolish the role of Race Relations Conciliator. When you have Labour's economic spokesman David Cunliffe warning New Zealanders "are set to become tenants in their own land" and New Zealand First leader Winston Peters thundering about "economic treason," now seems the time to expand the office and start educating New Zealanders, from Parliament down, that we're no longer the southern-most outpost of white Mother Britain.

It's not the first time that nationals of a major trading partner have shown interest in establishing a footprint in New Zealand. The Vesteys, the Liverpool-based meat and shipping empire of the last century, springs to mind. In its heyday, it owned a chain of freezing works across New Zealand, had a fleet of ships and a chain of butcher shops back in Britain. Unionists used to fulminate about this empire around pay negotiation time, but there was no popular undercurrent then to kick them out. It seems they even had a China connection - importing vast quantities of eggs from China during World War I to keep Britons' protein levels up.

The Vestey empire also included vast cattle ranches in Australia and South America. This included 300,000 hectares of beef grazing in Venezuela, which president Hugo Chavez is in the process of expropriating on behalf of the people. Somehow I don't see Mr Key taking any moves in that direction. But it is the far end of the continuum against foreign ownership that the Crafar farm debate has brought to the surface.

It's dispiriting that leaders of both the Labour Party, which signed the free trade treaty with China, and National, which is growing it, are pandering to the irrational xenophobia poisoning the debate. Is the foreign investment associated with more than half the wine industry also unwelcome? Ditto the forestry industry. If we're going to ban foreigners from buying a few cow "factories," are we going to put the walls up against selling other commercial enterprises.

It's a very small world these days, and we've elected to be part of it. Wouldn't it be great to hear a political leader stand up and say it.