OIO change: Positive for Whanganui forests
Wednesday 27 Jun 2018Investor interest in forestry estates around Whanganui - Investor interest in forestry estates around the Whanganui district could ramp up with Government's decision to amend the Overseas Investment Act.
The move cuts through some red tape and brings forestry rights into the overseas investment regime, opening the way for what the Government calls high end foreign investment.
Forestry Minister Shane Jones said it would be an important part of achieving the Government's plan to plant 1 billion trees and boosting economic development opportunities in the regions.
It comes at a time when harvesting of hundreds of thousands of logs from privately- owned forestry estates across Whanganui district accelerates.
New legislation would give investors' more flexibility in obtaining consents and removes unnecessary red tape.
He said other funding initiatives were also being pushed by the Ministry of Primary Industries to assist replanting and these, coupled with an easing of the investment regime "is a positive thing".
"It's definitely been well received within our industry. Now things are being replaced I believe it will ensure values in forestry will be kept up.
Marcus Musson, a Whanganui-based director of Forest Owners' Management Services (FOMS) said the announcement was "bloody good news" for what he said was starting to look like a sunset industry.
"It means foreign investors can buy trees without necessarily having to buy the land. They were restricted to lots over 1000ha but now they can buy into wood lots smaller than 1000ha. And there are a lot of forestry blocks in that category," Musson said.
He said the other major obstacle was the cost of going through the approval process with the Overseas Investment Office (OIO).
"When you're talking about $40,000 to $70,000 to go through that OIO process then it's the sort of impediment that turns many people away."
He said the changes made sense from another perspective as well as forests being cut now needed to be replanted if the Government's objective was going to be met. There was already a lot of replanting going on but he said NZ didn't have the investment capital needed to the reach that target.
Source: Wanganui Chronicle
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