Sky’s the limit for foreign investment
Bill English is keen for foreign investors to bring their money into New Zealand - but he’s well aware of the political sensitivities around the topic. Sam Sachdeva reports from the Prime Minister’s visit to Hong Kong.
From the 70th floor of CK Hutchison’s Hong Kong headquarters, it’s not hard to see why Bill English describes the Chinese territory as having its finger on the pulse of the world economy.
The sweeping views reveal stacks of skyscrapers clumped together in what is routinely ranked one of the top places to do business.
CK Hutchison’s chairman Li Ka-shing is the richest person in Asia, with a net worth of more than NZ$45 billion and a rags-to-riches story that earned him the nickname “Superman”.
Showing English the view, Li’s son and the company’s deputy chairman Victor Li said the business, with particular interests in infrastructure and assets worth nearly NZ$200 billion, owned one out of every nine high rises in Hong Kong.
Yet Hong Kong and China represent only 15 percent of its business, with Victor Li saying it had operations in 52 countries.
“I haven’t written anything in Chinese internally for about 20 years...we’re based on a lot of flights and video conference facilities.”
Among those countries is New Zealand: CK Hutchison owns Wellington’s lines company and waste management firm EnviroNZ (formerly EnviroWaste).
With Hong Kong among the top 10 sources of foreign investment in New Zealand, English said his visit was a chance to catch up with those spending their money in the country - and encourage others to join them.
“We’re always open to new investment, we’ve got good relationships with these investors and others offshore, and New Zealand has a pattern of checking in with them about what’s working, what’s not working, and also what their tensions are.”
During the Japan leg of the trip, English often spoke enviously about the country’s infrastructure, and it is clear he sees foreign investment as one way of dealing with the pressure on essential services from record migration levels.
“We are particularly focused on infrastructure investment because we believe that New Zealand can be a growing economy with a growing population and we can invest in sufficient infrastructure to make all that work.”
However, he was quick to say he did not see any fundamental changes to central and local government “overwhelmingly” funding New Zealand infrastructure.
Playing by the rules
English also appeared acutely aware of the sensitivity of foreign investment in New Zealand, particularly from China and its territories.
He said businesses would have to follow the rules on overseas investment, as well as with temporary work visas and skill levels if it planned to bring over a foreign workforce.
“There’s no question of creating any special conditions for particular investors or Chinese investors or workforces from any particular country.
“We welcome them to help us get the job done but they have to meet all our current requirements.”
That did not stop him from again defending the government’s migration policy.
“We’ve got a lot of stuff to build over the next 10 years, thousands of houses, large infrastructure projects, so we need the skills coming in, that’s why we disagree with policies about shutting down migration - if we shut down migration you won’t be able to get the houses built.”
Some New Zealanders’ anti-foreigner sentiments may be one of the reasons for English’s visit: he said investors were often sensitive to public opinion and did not want to be seen as villains.
Also an issue was the Overseas Investment Act, with potential investors needing be talked through the process.
“There’s a bit of hesitation, mainly actually about the complexity of the rules, the hurdles they have to get over.
“We have one of the more restrictive sets of rules among developed countries, and so anyone coming in likes to understand all those and often we’re explaining to them the reason for the rules is to make sure the investments are beneficial to New Zealand.”
With English also meeting the territory’s outgoing chief executive CY Leung and his successor Carrie Lam, he said the trip would also give him a sense of “whether all this political noise around the world is having an effect on the economy or not”.
“When you’ve got the threats from North Korea, the domestic politics in the US, some of the tensions among the larger economies in Asia, Brexit going on, you could get the impression that no-one’s focused on the economy.
“Coming to Hong Kong’s a good way to get a sense of how the economy’s going underneath all that and whether the political instability is having an impact on it.”