This Blog does genuinely try to be non-partisan, making it neither a friend of National, nor Labour. We are doing what State Broadcasters like Radio NZ & One News should be doing, but are not, since they became a front for Labour, Greens & Te Pāti Māori. On that note, its quite an accusation, and maybe something is wonky with my sources, but looks like the PM & Infrastructure Minister may have not told the truth about their Invest NZ conference, held next week in Auckland.
The Beehive has formally announced: "Going for growth: International investment summit to boost infrastructure & jobs: About 100 of the world’s high-profile investors, business leaders & construction companies are expected to visit NZ in March for a global investment summit." The statement is signed off by PM Luxon & Minister Bishop. What's the problem? Today the NZ Herald says, "Revealed: The international businesses invited to Auckland investment summit". Look at their list of 100 international businesses who are "visiting" Auckland (in the words of the Beehive). By my count, one half of them are local Auckland businesses.
How can one make that extraordinary claim? It beggars belief, but the Guest List, in terms of Auckland law firms alone, reads like this: Bell Gully (where Finance Minister Willis' father was a partner), Buddle Finlay, Minter Ellison Rudd Watts, Simpson Grierson & Russell McVeigh. Jeepers creepers. On top of them the Big Auckland Accounting Firms KPMG and BDO have piled in. As well as NZ's Big Monopoly Banks ANZ, ASB, BNZ and Westpac. What boggles belief is that the folks most responsible for exporting investment capital out of (not into) NZ in the form of our local asset managers (who buy stocks in places like the US, using Kiwi Saver and other funds) fill out the Guest List like flies on rotting meat. They include Craig's Investment Partners, First Cape (which owns JB Were), Simplicity, Jarden, Milford Asset Management & NZ Super Fund. Why has Monopoly Building Firm Fletcher Building been invited? Isn't one point of the conference to increase competition & break its monopoly? Will Fletcher's bid for overseas contracts there? Will its CEO tell potential foreign investors that NZ is a terrible place to invest so he can get the work? Probably. Just the companies we've named above make up nearly 20% of the attendees. It is so bizarre, it can't be true.
From an economist's point of view, this doesn't look like a conference where overseas firms will be sizing up Foreign Direct Investments in NZ, which, by definition, means taking stakes with significant control of the projects. It looks more like local Auckland fund managers trying to attract money for their funds so they can slice off commissions. It looks like Big Auckland Law Firms touting for business. Why were they given NZ government access, whereas smaller law firms were not? Does Finance Minister, Nicola Willis, who is attending, like how her Dad's law firm, Bell Gully, is attending, whereas smaller firms like TGT Legal, one of NZ's finest, are not? Foreign investors shouldn't told what lawyer to hire. Does the PM want to tell them? "Nicola knows a good one" - is that his line? Inviting Industrial & Commercial Bank of China (NZ) is odd. Its Chair is Don Brash, former Leader of the National Party. Doesn't he already know about investment opportunities in NZ? One doesn't want to pour cold water on Luxon, but can National please become the real deal, rather than trying to pull off marketing & PR stunts a la Ardern? The Beehive has put in writing 100 overseas firms are "visiting" NZ to discuss investments. Not so. The PM says his conference is about Foreign Direct Investment, not short term "portfolio investments", which NZ already has no problem attracting. The Kiwi $ is one of the most traded currencies in the world. But we're not after that kind of "hot money". New Zealand is after long term investments that bring technical expertise with them. By my count, fully one half of the 100 attendees are local firms, most of them on-commissions middle men. What's going on? I must be wrong.
Professor Robert MacCulloch holds the Matthew S. Abel Chair of Macroeconomics at Auckland University. He has previously worked at the Reserve Bank, Oxford University, and the London School of Economics. He runs the blog Down to Earth Kiwi from where this article was sourced.
How can one make that extraordinary claim? It beggars belief, but the Guest List, in terms of Auckland law firms alone, reads like this: Bell Gully (where Finance Minister Willis' father was a partner), Buddle Finlay, Minter Ellison Rudd Watts, Simpson Grierson & Russell McVeigh. Jeepers creepers. On top of them the Big Auckland Accounting Firms KPMG and BDO have piled in. As well as NZ's Big Monopoly Banks ANZ, ASB, BNZ and Westpac. What boggles belief is that the folks most responsible for exporting investment capital out of (not into) NZ in the form of our local asset managers (who buy stocks in places like the US, using Kiwi Saver and other funds) fill out the Guest List like flies on rotting meat. They include Craig's Investment Partners, First Cape (which owns JB Were), Simplicity, Jarden, Milford Asset Management & NZ Super Fund. Why has Monopoly Building Firm Fletcher Building been invited? Isn't one point of the conference to increase competition & break its monopoly? Will Fletcher's bid for overseas contracts there? Will its CEO tell potential foreign investors that NZ is a terrible place to invest so he can get the work? Probably. Just the companies we've named above make up nearly 20% of the attendees. It is so bizarre, it can't be true.
From an economist's point of view, this doesn't look like a conference where overseas firms will be sizing up Foreign Direct Investments in NZ, which, by definition, means taking stakes with significant control of the projects. It looks more like local Auckland fund managers trying to attract money for their funds so they can slice off commissions. It looks like Big Auckland Law Firms touting for business. Why were they given NZ government access, whereas smaller law firms were not? Does Finance Minister, Nicola Willis, who is attending, like how her Dad's law firm, Bell Gully, is attending, whereas smaller firms like TGT Legal, one of NZ's finest, are not? Foreign investors shouldn't told what lawyer to hire. Does the PM want to tell them? "Nicola knows a good one" - is that his line? Inviting Industrial & Commercial Bank of China (NZ) is odd. Its Chair is Don Brash, former Leader of the National Party. Doesn't he already know about investment opportunities in NZ? One doesn't want to pour cold water on Luxon, but can National please become the real deal, rather than trying to pull off marketing & PR stunts a la Ardern? The Beehive has put in writing 100 overseas firms are "visiting" NZ to discuss investments. Not so. The PM says his conference is about Foreign Direct Investment, not short term "portfolio investments", which NZ already has no problem attracting. The Kiwi $ is one of the most traded currencies in the world. But we're not after that kind of "hot money". New Zealand is after long term investments that bring technical expertise with them. By my count, fully one half of the 100 attendees are local firms, most of them on-commissions middle men. What's going on? I must be wrong.
Professor Robert MacCulloch holds the Matthew S. Abel Chair of Macroeconomics at Auckland University. He has previously worked at the Reserve Bank, Oxford University, and the London School of Economics. He runs the blog Down to Earth Kiwi from where this article was sourced.
9 comments:
Many politicians are now totally out of touch with the people. This is both the left and right wing parties. It is a small club and "we just ain't in it". Consequently, voters are always becoming disgruntled as they see they are merely means to an end for these people. It is concerning how blasé they are about the important issues. We need both ACT and NZF to deflate their bubbles and pick up more voters at the next election. These parties are certainly not perfect but will provide more balance.
There is an argument that KPMG, BDO ANZ, ASB, BNZ and Westpac are foreign firms and can certainly bring foreign capital into NZ.
It will be nice to have international fund managers there but they have a lot of options and are probably reading the despicable nz media's constant idealogical,, false, desecration of our prime minister, and are thinking about the destruction a new Labour Party hierarchy will reap.
NZ voters should have the same fear!
Hopefully the new NZ Herald leadership will right the ship in time for all hard working NZers to understand the damage a Labour government will once again to do their lifestyle.....
Presumably, these overseas investors have been 'invited' at the taxpayers expense? One hopes that our local attendees are paying handsomely for the opportunity of selling their services, but it does make one ponder how these overseas investors were actually identified and what role some of those, like the identified Fletchers, will be playing?
Farmers ,growers and small business should be the ones Government should be focusing on.
Even injecting capitol in to rural areas decimated by Gabrielle will give an export return in the future .A good investment.
Talking to the leeches and middlemen will achieve nothing.
It would be great if a leading presenter was a small nuclear power company or a clean coal thermal electricity construction company to enable badly needed backup electricity for when the wind is having a lazy day and the clouds block out the sun. YES NZ needs real backup electricity production.
After a perusal of the list 10% are Maori groups and NgaiTahu have two invites . Interntional Investment Summit - Yeah Right
They probably could not get enough foreign company represntatives to fill the room, Robert. The problem the Government has is they have said they are going to push for growth of the NZ economy (which is good) but have not articulated the areas they think growth can occur in. At the moment they only have what amounts to a "slogan".
Mark --" It will be nice to have international fund managers there but they have a lot of options and are probably reading the despicable nz media's constant ideological ....."
I doubt the international fund managers rely on NZ MSM for their information. They are numbers people and will be analysing data about NZ and it's investment potential. That data will not look good at the moment given the ongoing recession.
Robert. Do.you really think expert investors with multi decade time frames for returns do not study the short and long term political landscape of the countries they invest in?
Political attitudes and influences are at the top of the information gathering / investment analysis list.
It is not for the government to decide and articulate where growth will occur, that job is for the savvy 'skin In the game' private sector.
The Government's job is to provide the electricity, roads, ports, regulatory framework, and tax system which support growth.
That is exactly what Luxons government is doing.
It's all there in the coalition agreements.....
For example, Luxons government has cleverly defined an infrastructure priority list / plan and set up an organisation to implement the list, free from political and public service influence.... based on the successful australian models.
The NZ rescession is an opportunity for savvy investors, not a threat!
it will save political bloggers a lot of embarrassment if they actually read the coalition agreements and plans to understand what is happening, before they mistakenly criticize.
As Mark Hanley appears to have a very good handle on the National Party's objectives, perhaps he could divulge how they, and the overseas investors they seek to encourage, will view investment in a country that is on a path to operate as an ethnocracy in the very near future? While our PM seems ambivalent, I'm sure offshore longer term investors will be less so.
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