Protectionism rears its head

New Zealand First wants to reduce foreign ownership of New Zealand assets and proposes setting up a fund to buy some of them back. It is time, Winston Peters told the party faithful last weekend, to staunch the haemorrhage of money to Australian-owned banks and other foreign interests. Yet this tub-thumping came only three days after the Treasury published research which concluded that foreign capital has been on balance positive for national income. Just as well, because we are certainly hooked on it. At the end of March foreign investment in New Zealand stood at $274 billion. That includes about a third of all the funds New Zealand banks lend out. It is partially offset by New Zealand investment overseas, but the net liability position is still $154 billion or 86 per cent of gross domestic product, a very high level for a... [read full story]