By Sasha Padbidri
The Shanghai Pengxin investment group’s bid to buy 16 dairy farms in New Zealand has finally been green-lighted, with the group set to pay NZ $200 million ($163 million USD) in a deal that’s been met with fierce opposition within New Zealand since it was first announced earlier this year. The deal was okayed after a lower bid made by the Maori-owned Tiroa Te Hape Trust was rejected by the New Zealand government.
The sale of Crafar Farms is part of a trend of Chinese firms buying into New Zealand’s agribusiness, with the Shanghai-headquartered Bright Dairy already owning the majority stake in Synlait, a New Zealand dairy processing company.
With the paltry amount of arable land in Asian countries being a cause for concern, it appears that companies and governments now have to look abroad to appease the demand for food and other resources. In 2008, the South Korean Daewoo Group raised eyebrows worldwide when it made a bid to lease half of all arable land in Madagascar to cultivate crops, in a controversial deal that was eventually nixed by the country’s president in 2009.
Unfairly or not, announced intentions like Shanghai Pengxin’s bid to “upgrade the farms, train New Zealanders to work on them, invest in a New Zealand processing plant and provide money to market the products in China” are often interpreted as mere rhetoric for deals considered to be neo-colonialist land grabs.
The issue is especially poignant in New Zealand, a country with a legacy of British colonialism, and such commercial interest is bound to create tension between the government and the native Maori population. A large protest against the farm sale has already been planned for Queen Street in Auckland, while a legal appeal against the deal has also been filed.
As of now, the Tiroa Te Hape Trust is looking to buy back two of the farms out of the 16 that Shanghai Pengxin has acquired. One can only hope that Shanghai Pengxin will tread carefully in New Zealand and treat the situation with tact.
But given the track record of China’s tact in dealing with darker-skinned “Nationalities” and the issue of colonialism, we’re probably not going to hold our breath for this one.