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Ministers Set Up Open Season on New Zealand Farmland

27 January 2012

Ministers Set Up Open Season on New Zealand Farmland

The decision by two Government ministers to sell the Crafar Farms to the Shanghai Pengxin Group is wrong in law and, if not overturned by Judicial Review, sets up open season for any foreign buyers wanting New Zealand land, the Crafar Farms Purchase Group said today.

The Group is the highest New Zealand bidder ($171.5 million), offering $21.5 million more than the Government's farming SOE, Landcorp.

Following today's ministerial announcement approving the sale to Shanghai Pengxin, the Group confirmed it would proceed with a Judicial Review launched earlier this week to try to stop the land from being sold offshore. The deal between the Crafar receivers and Shanghai Pengxin will effectively make the New Zealand Government a tenant on New Zealand soil to foreign investors.

The Group also confirmed that, if it is successful and becomes the owner of the farms, it will divide them amongst its members, which consist of local Central North Island farmers, iwi groups and Auckland businessman, Sir Michael Fay.

No member of the group would own more than two farms and all are happy for legal restrictions to be placed on the farms' title preventing, in perpetuity, their subsequent sale to foreigners.

A member of the purchase group, Hardie Peni of Tiroa E and Te Hape B Trusts, said his people were "dismayed but not deterred" by today's ministerial decision.

"All public opinion polls have been overwhelmingly against the Shanghai Pengxin bid, with more than 80% of New Zealanders against the sale of large parcels of productive farm land to overseas buyers," he said.

"This is one issue where all Kiwis, Maori and Pakeha, urban and rural, stand together. Kiwis are right to be mightily concerned that this National/Maori Party Government has stood by and waved foreign buyers through our farm gates.

"Last November, during the election campaign, Prime Minister John Key was only concerned about public opinion - but he now says public opinion does not count in this decision. The result is that all New Zealanders, and in particular Kiwi farmers, have been shafted."

Mr Peni said Shanghai Pengxin has no background in farming.

"Shanghai Pengxin is just an agent for the Chinese Government and if it can get approval to buy Kiwi land then any foreign company or government has a free hand to buy whatever farmland they want in New Zealand. No Kiwi farmer could compete against this sort of international money and diplomatic pressure and stay in business."

Another group member, Sir Michael Fay, who will own two of the 16 Crafar Farms if the purchase group's proposal is successful, said the group had no choice but to seek a judicial review of the ministers' decision.

"Back in September 2009, Finance Minister Bill English was justifiably boasting about law changes he had achieved to allow ministers to veto OIO recommendations for large-scale foreign buyouts of New Zealand farmland.

"That two ministers have failed to apply Mr English's laws properly makes a mockery of his boasts."

The purchase group also argues that the ministers' decision would have been wrong in law even before Mr English's amendments.

Group spokesman Alan McDonald said Shanghai Pengxin did not meet the criteria for overseas investment in New Zealand.

"By its own admission, Shanghai Pengxin Group does not have experience in dairying which is why they are trying to use the New Zealand Government's own SOE, Landcorp, to put the veneer of a Kiwi face on this deal. The fact that Shanghai Pengxin does not have this dairy farming experience makes them nothing more than a passive investor and on this basis we believe the application should have been rejected." he said.

The Crafar Farms Purchase Group Judicial Review claim was filed last Tuesday and is expected to proceed next week in front of Justice Miller in the Wellington High Court.


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