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Rule change will drive investors away

16 June 2005

Rule change will drive investors away

The Government's changes to the Investor Category immigration rules will drive investors away, says Business NZ Chief Executive Phil O'Reilly.

"By doubling the amount of investment required and lowering the eligibility age by over 30 years (from under 85 to under 54) the Government has immediately slashed the number of potential investors," Mr O'Reilly said.

"Potentially even worse is the decision that the investment must go directly to the Government for infrastructure spending. Investment in the private sector has been banned.

"Previously investors could make choices about their investments and were expected to make a commercial return. Under the new scheme, they will be required to give the Government at least $2 million for five years with their only return being an inflation adjustment," he said.

"What kind of incentive is this for successful people to invest here? People who have $2 million to invest have not got it by investing in schemes which return only the rate of inflation!"

While Business NZ appreciated that the Government was looking to align the various categories and was worried about some investment, Mr O'Reilly described the announcement as a heavy handed response that would succeed only in driving potential investors to Australia.

ENDS

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