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China Second Largest Investor into New Zealand, Canada the Largest

Recently released data shows that China is now the second largest foreign investor into New Zealand, and the years 2013 and 2014 saw NZ$1.9 billion (C$1.7 billion) in new Chinese investment make up 14% of New Zealand’s total inbound foreign direct investment, according to KPMG’s Foreign Direct Investment in New Zealand: Trends and Insights. Chinese investment, although high-profile, was still significantly smaller than Canadian investment into New Zealand: at 22%, Canada led inbound foreign direct investment into the country during the two year period. The United States and Australia were additional major sources of investment, with 13% and 11% of the total, respectively. All numbers were based on gross consideration data from New Zealand’s Overseas Investment Office.

A NZ$950 million waste management deal in June 2014 was the largest Chinese investment into New Zealand, while a NZ$1,102 million deal in November 2014 – a Canadian property portfolio investment – was the largest of any foreign investment into New Zealand. Mainland China was the source of 30% of investment into agribusiness during 2013 and 2014, with Hong Kong an additional 19%. With regards to land acquisition, Mainland China acquired 27,000 hectares during this period, or 11% of total foreign land acquisitions; Hong Kong acquired an additional 6,000 hectares, or 2% of the total; both were dwarfed by the 115,000 hectares (46% of the total) acquired by the United States, while Canada acquired 5,000 hectares, or just 2% of the total.

New Zealand, like Canada, has witnessed public debate surrounding aspects of Chinese investment, especially with regards to foreign commercial acquisition of land, and both are undergoing industry-wide difficulties in the dairy and oil sectors respectively, areas that have historically received large-scale Chinese investment. New Zealand and Canada are also reportedly deadlocked over dairy industry-related aspects of the Trans-Pacific Partnership negotiations, with New Zealand seeking increased access into a protected Canadian market.

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