17 June 2005

Labour and National join forces to sell off New Zealand

The ramming through of the Overseas Investment Bill under urgency late last night will allow multinational corporations and international financial instituions to buy up significant New Zealand assets with far too few effective controls on their behaviour, says the Alliance.

"The new law fails to protect New Zealand's sensitive business and land assets, as it loosens the current rules in most areas." says Alliance Trade spokesperson Joe Hendren.

"It should not be blindly assumed that all overseas investments are in New Zealand's best interests. With the new Overseas Investment Act, Michael Cullen continues the 'no hands' free market mantra of the Fourth Labour Government. Even Don Brash supported this bill."

The Alliance believes New Zealand needs to take a more strategic approach to overseas investment, an approach that values quality over quantity and safeguards the economic, social and environmental interests of the country.

"New Zealand needs the ability to pick and choose 'greenfield' type investments offering new jobs and growth, and reject proposals that are really just simple takeovers offering us little economic benefit," says Joe Hendren.

"In the same week the Government concedes more money will need to be spent to fix up the rail track, a legacy of its privatisation and sale to irresponsible overseas owners, the same Government passes a bill through Parliament that will do nothing to stop such disasters happening again."

The Alliance believes adherence to a corporate code of conduct should be made a condition of consent for foreign purchases. All purchases, not just those involving land, should be subject to a strengthened national interest test.

"In 2001 Government members of the Finance and Expenditure Select Committee made remarkably similar recommendations, but Dr Cullen ignored this advice when drafting the new bill."

"The Alliance fears the new rules will lead to further privatisation of state owned assets, as there will be fewer safeguards to protect the national interest when such sales are proposed. More New Zealand companies will be bought up by the multinationals, as many significant enterprises will fall below the new $100m threshold, meaning that huge chunks of our economy will be sold off with no scrutiny.”

“I expect many of Labour’s grassroots supporters will be very concerned to see National joining Labour to support this bill. A party like the Alliance is urgently needed back in Parliament to stop the Labour party abandoning its history and adopting National's destructive right wing policies," says Joe Hendren.

Earlier this year the Alliance presented a substantial written submission to the Select Committee considering the Overseas Investment Bill. The submission can be read on our website at www.alliance.org.nz. Joe Hendren is a Christchurch based list candidate for the Alliance.

ENDS

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