Investment

Stuart Nash defends new investor visa program, calls National's 'broke'

The Government’s being warned it may have just thrown away billions of dollars of international investment by scrapping the lucrative investor plus visa categories and replacing them with a new investor migrant visa.

The Economic Development Minister’s goal is to attract wealthy migrants who want to directly invest in Kiwi companies, rather than just investing in shares, to get residency.

The old visas required a NZ$3 million or NZ$10 million investment, now it will be NZ$5 million direct into Kiwi companies or NZ$15 million for passive investments like equities on the NZ stock exchange.

Tova asked Economic Development Minister Stuart Nash on Thursday morning "if it ain't broke, why fix it?"

"Because it was broke," said Nash.

"So what I can tell you is over 50 percent of the money, so-called, invested by people who'd come into New Zealand under this visa, had gone into Government and private sector bonds. 

"That is money that is not adding any value to the New Zealand economy at all. We believe that people who are coming into New Zealand under the investor migrant visa should actually invest in New Zealand in a way that creates wealth for our communities, our companies and ultimately our country."

O'Brien asked about the validity of that information, suggesting that research shows the mega-rich are more likely to invest in NZ businesses over time while they are here once they "understand the lay of the land" a little more.

Nash said that they do not have that research, even though they have a legal right to ask for that information from migrant investors. Though, investors are not legally obligated to produce this information to the Government.

Tova asked Nash again if the Government had asked the big investors those questions.

"No, we haven't asked them," said Nash.

"But the thing is, Tova, is I want people who are coming into this country to invest in a way that actually adds value. Now, I spoke to a New Zealand stock venture capitalist last night, and he said he's been calling on the Government to do this for years. He said there are far too many people coming into New Zealand, almost retiring, investing their money in Government bonds.

"It adds no value... It is a privilege to live in New Zealand, not a right in any way, shape or form. With that privilege comes obligations. One of those obligations is to ensure that the investments you make into this country are adding value. I think that's reasonable. I think the vast majority of Kiwis would agree."

There are some genuine fears that the policy change could scare investors off, with Nash himself admitting the Government now expect fewer overseas investors to migrate to NZ following the change.

Nash said they haven't been able to model just how many fewer investors would come to NZ because of the policy change either - just that they "expect less."

So without solid data on how many investors will be scared off - and solid data around their investing habits once settled in, NZ could be in for a large pay cut.

National's Immigration Spokeswoman Erica Stanford weighed in with Tova later this morning too.

Listen to the full interview between Stuart Nash and Tova above.

You can also download the full interview on the Tova podcast, and listen on the go. Check it out on the rova app or wherever you get your podcasts.