Foreign investors took out $9 billion last year

Nearly $9 billion of net foreign investment was withdrawn from New Zealand in the last financial year.

Nearly $9 billion of net foreign investment was withdrawn from the country in the last financial year.

"This is the first time that there has been a net withdrawal of foreign investment out of New Zealand since the current series began in the year ended March 2001," said John Morris, manager of government and international accounts for Statistics New Zealand, as balance of payments figures for the year ended March 2009 were released today.

Financial transactions saw $8.9b of foreign investment withdrawn, according to the figures.

They also showed the level of New Zealand's investment in the United Kingdom, United States and Australia increased $8.9b to $126b during the year, mostly due to greater levels of investment in the US.

Twenty-five per cent, or $31.5b, was now invested in the US, up from 20.9 per cent at the same time last year.

However, Australia remains New Zealand's most significant investment partner, and was the destination for $35.6b, or 28.2 per cent, of investment abroad.

Australia is also still the largest source of foreign investment here. Together with the UK and US, the countries accounted for $203.2b, or 67.8 per cent, of total investment in New Zealand.

Since March 2004, investment from Australia has increased $45.2b, or 88.5 per cent, due mainly to loans by Australian banks to their New Zealand subsidiaries, combined with increased direct investment.

There was also a $16.1b withdrawal of New Zealand investment from overseas during the March year, of which 61.7 per cent involved the drawing down of reserve assets.

The finance and insurance industry held 62.5 per cent of New Zealand's assets abroad, and 60.7 per cent of the country's international liabilities.

Since March 2004 the electricity, gas, water, and waste services industry has increased the value of its international liabilities by $5.4 billion, mainly due to increased foreign direct investment.

New Zealand's foreign currency external debt was $117.5b. Of this debt, 91.9 per cent was hedged in some way to manage risk.

- NZPA