Foreign Control - Key facts
Foreign direct investment (ownership of companies) in New Zealand increased from $9.7 billion in 1989 to $82.7 billion at September 2006 - over 700% more.
Foreign owners now control 41% of the share market. In 1989, the figure was 19%.
In 2005, the Overseas Investment Commission (OIC) and its replacement, the Overseas Investment Office (OIO), approved foreign investment totalling $14.3 billion, which was well above the average of $8.8 billion for the previous decade. All but about $3 billion was sales from one overseas company to another. Until August 2005, only company takeovers involving $50 million or more needed OIC approval, except those involving land or fishing quotas. Until 1999, the threshold was $10m. As from August 2005 the government increased it to $100m and replaced the OIC with the OIO in the government department, Land Information New Zealand.
In 2005, the OIC approved the sale of 149,473 hectares of rural land to foreigners, of which about 100,000 hectares was from one foreign investor to another. Foreign owned land covers more than one million hectares or about 7% of our commercially productive land area.
Statistics NZ figures, as of March 2006, list the biggest foreign owners of New Zealand companies as, in decreasing order: Australia, US, UK, Singapore, Japan, Netherlands, Hong Kong, Germany, Switzerland and Italy.
Transnational corporations (TNCs) make massive profits out of New Zealand. These can truly be called New Zealand's biggest invisible export. In the decade 1997-2006, TNCs made $50.3 billion profits. Only 32% was reinvested, and in some years more was sent overseas than was earned or the reinvestment was significantly offset by capital being taken out of the country.
The great majority of foreign "investment" is a takeover, not creating new assets.
Foreign investors are not great for employment - they only employ 19% of the workforce, despite owning a huge proportion of the economy. Foreign ownership does not guarantee more jobs. In fact, it quite often adds to unemployment. TNCs have made tens of thousands jobless.
Foreign ownership does nothing to improve New Zealand's foreign debt problem. In 1984, total private and public foreign debt stood at $16 billion. As of September 2006, it was $182 billion, equivalent to well over 100% of New Zealand's Gross Domestic Product, despite all of the asset sales and takeovers.
Ownership means political power. Foreign control means recolonisation, but by company this time, not country.
Nearly everything that has been done to New Zealanders in the past decade has been done to "make the New Zealand economy attractive to foreign investment". This is what it all means to ordinary New Zealanders - we are involuntary competitors in the race to the bottom.