Federated Farmers welcome the government’s decision to change New Zealand’s investment settings after the OECD ranked the country last in openness to investment.

“As a small nation, capital and investment from overseas can help New Zealand to fix infrastructure and drive industry development,” Federated Farmers meat & wool chair and forestry spokesperson Toby Williams said.

The government should continue to screen investment types, including farmland sales, to protect national interests, said Williams.

“However, fast-tracking the overseas investment assessment process when no risk factors have been identified and consolidating the investor, benefit and national interest tests also makes sense,” he said.

“We understand the farmland test can take as long as two years from application.

“It’s such a long-winded process that investors can lose interest and pull out.”

Williams doesn’t see any risk the proposed changes to the Overseas Investment Act will accelerate the conversion of farmland to forestry.

“The land use changes we are seeing are due to settings with the ETS distorting the profitability of one land use over another.”

The government’s plans to issue policy statements highlighting areas welcoming overseas investment are a step in the right direction, Williams said.

“The current process of either amending the legislation or a letter of expectation from the minister tends to take too long or is not an ideal mechanism,” he said.