The Overseas Investment Office has just approved the sale of eight Waikato dairy farms comprising 3,205 hectares of land to a Swedish consortium.
This decision follows last year’s contentious decision to allow Chinese Company Shanghai Pengxin to purchase the Crafar farms. The 16 Crafar farms comprised nearly 8000 hectares of farmland.
An overseas purchaser must show that they are bringing significant economic benefit to New Zealand.
The Swedish consortium that has purchased the farms has stated it wants to lift milk production and develop the farms. Presumably this is the substantial economic benefit to New Zealand from allowing this purchase.
This argument is reminiscent of the one Shanghai Pengxin used in the High Court after an legal challenge by a consortium of Iwi and Sir Michael Fay.
Shanghai Pengxin’s argued that they would bring the rundown Crafar farms up to working order.
Here we have a Swedish consortium arguing that they will follow standard farming best practice and lift milk production.
Of course the woefully understaffed Overseas Invest Office are unlikely to monitor if any substantial economic benefit does flow from this purchase.
This test is simply a way of allowing overseas investors to buy up prime New Zealand land. Decisions such as this mean any overseas investor that can outbid New Zealand farmers will be able to buy up land in New Zealand.
Perhaps the significant economic benefit to New Zealand is keeping former Shanghai Pengxin spokesperson Cedric Allan in business. Mr Allan is handling the media for the new owners.