China

Imagine the taniwha tax!

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Hmm, seems the Chinese can do anything.

This solution would be a lot cheaper than buying up land but the taniwha tax would be horrendous.

A stunning new route opened in Hubei province, central China, on August 9.

Incredible images of the new road shows that drivers are literally travelling over water as the 6.8-mile motorway is built in the middle of a river valley.   Read more »

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Labour have been hating on the wrong people – it’s Canadians that own most of our stuff

It isn’t people with chinky sounding names…it is Canadians who are our largest foreign investors.

A new report reveals Canada was the dominant foreign investor in New Zealand in the last two years.

The study by financial services firm KPMG found Canada accounted for 22 percent of overseas investment in 2013-2014.

It looked at major transactions, but did not include residential property.

China – though by far the biggest foreign player in the dairy sector – was second on overall investment with 14 percent, followed by the US (13 percent) and Australia (11 percent). The US was the biggest buyer of land in that period.   Read more »

Sure John, nobody’s panicking. But the dairy slump’s hit main street

Farmers are keeping their wallets shut as they face at least a year or two of tough conditions.

They’re fighting to stay on their farms, but in the towns, the lack of money is going to kick start unemployment.

Retailers in Taranaki say the downturn in the dairy market is starting to hit turnover, with sales declining by between 10 and 20 percent.

Fonterra has slashed its forecast payout for the season to $3.85 a kilo of milk solids – far below the break-even point for many farmers, whose spending on non-essential items has all but evaporated.

Michael Eager, who owns the R J Eager furniture stores in New Plymouth and Stratford, said it was taking longer to shift stock.

“We are already seeing a slowdown in retail sales. Enquiries have dropped away so it is impacting at the present time quite strongly and particularly in the small towns.

“We have a business in Stratford, and we’re seeing that impact take place now.”   Read more »

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Parroting the obvious

In August 2014 real reporters around the world ran stories about China’s milk stockpile, and everyone in China who was anybody, knew China was stockpiling those resources.

The news that Russia is banning imports of dairy products from all EU states should be the least of our concerns.

What dairy farmers here should be doing, rather, is looking even further to the east, to China.

For there are some ominous signs that that country’s snapping up of massive volumes of dried milk powder produced in the west may well have been a stockpiling exercise and that it is now coming to an end ahead of an anticipated downturn in the Chinese economy.

That could have quite severe repercussions here where a lot of the ‘surplus’ milk, which has been sloshing about in the market, has gone to drying plants in an exercise which acts as a useful price stabiliser. The effects are already being felt in the arena of global dairy auctions, where prices dropped 8.4 per cent this week and are now 50 per cent lower than they were in February – and it’s worth noting that whole milk powder (down 11.5 per cent) and skim milk powder (down 6.5 per cent) were among the big losers.

So stand by for even more price cuts at the farm gate…

Yet, despite how many junkets to China and resources put in by NZ Inc and a newspaper, it’s only when Bill English makes comment on it off his own bat, does Frances O’Sullivan – a newspaper’s pre-eminent repeater – actually even record it as happening.

It was Bill English who finally punctured the myth that the lengthy price slump that has carved billions of dollars off New Zealand dairy returns is simply a short-run thing.

Not so, said the Finance Minister on his return from China this week.   Read more »

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Well bugger me, Bill English has become a free marketer

Bill English has just returned and discovered that the Chinese are sitting on a massive stockpile of milk products. From China:

The Finance Minister, fresh from a week long trip to China, New Zealand’s largest export market, said that there was a picture of an international glut of dairy products which would keep prices lower for some months to come.

In recent weeks the US Department of Agriculture had highlighted an increase in stocks of dairy prices being stored in China.

“It appears there’s been almost literally a mountain of milk powder in warehouses around China, more than people thought so it might take a bit longer to work through,” English said.

“The way it’s been described to me, there’s been a perfect storm of excess milk supply, influenced by events in Russia, Europe, in China, in New Zealand, Australia and that’s led to these prices which I think everyone regards, everyone believes are too low for the health of the dairy industry, whether it’s here, in China or in Europe, but it is going to take some time for the prices to pick up.”

English remained confident that there would be a recovery in dairy prices some time in 2015.

“I don’t think there’s much doubt that they’re going to pick up, it’s just a matter of when and how fast.”

Estimates ranged from picking up in a few months to remaining flat until Christmas, English said.

“I haven’t seen any estimate that it would take years to clear up.”

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Comment of the Day

Yesterday Phil Goff responded rather limply to Judith Collins’ robust kicking of Labour’s racist housing policy.

Born in China and now a Kiwi, Joey loves New Zealand and has a professional job here.

He wants to buy a home of his own but with house prices up on average in Auckland by $116,000 last year, he can’t afford it.

He resents the fact that offshore investors helped push up property prices and can outbid him at auctions.

It’s not racist to worry about the impact of offshore property investment on house prices, it’s common sense.

Chinese cities like Beijing and Shanghai don’t allow non-resident purchase of residential property and Hong Kong and Singapore impose taxes to discourage it.

Stopping foreign investment by those who never intend to live here is one element in cooling Auckland’s over-heated property market.

It doesn’t affect residents in New Zealand and any restraints would apply to all foreign investors, not just Chinese.

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Comment of the Day

With all the lack of facts and figures surrounding Labour’s race-baiting policy it is refreshing to see some real statistics, not some race based profiling of stolen data like Labour uses.

More interesting still is that it comes from one of our own commenters.

Nick Smith may have a point that Auckland’s housing “challenge” may not be affected by foreign investors. Certainly not Chinese investors. NZTE’s figures on the “Stock of total foreign investment in New Zealand by country” in the year ended March 2014 shows that the total foreign investment in NZ was $322.3billion.

Of that the investment from mainland China makes up just 1%. Even when you factor in investment from Hong Kong (1.6%) you end up with the same level of investment from the Chinese in total (2.6%) as from Japan alone (2.6%). Add in Singapore and Malaysia and you still only end up with just over 7% investment from Asia.

So where does the other over 90 odd % come from? Oh yes – English speaking countries with people with predominantly white faces from the US, Au, UK, Canada and the Netherlands!

Presumably investors from those parts will in many cases be looking for homes to buy in our biggest cities too?   Read more »

Is Phil Twyford screwed in Te Atatu?

Race-baiter and Labour MP Phil Twyford probably should have looked at his electorate profile before he started blaming the Chinese for Auckland’s housing problem.

Twyford is a Grade A halfwit for not considering his majority in Te Atatu, and the number of people who don’t fit his racial profiling who live and vote there.

Here are the most recent election results from Te Atatu. Note that National won the Party Vote, so there was a strong Twyford vote before he became a racist.

Labour 11,603 National 13,614 National Majority  2,011

Twyford 15,676 Ngaro  12,863 Twyford Majority 2,813

Then if you were to have a look at the electorate profile for Te Atatu in June 2015 you would discover some very interesting facts.  Read more »

What is the real effect of Chinese buyers on the market?

We have seen a great deal of smoke but not a lot of fire in the form of hard data from labour or anyone else talking about the effect of offshore Chinese buyers int he market.

In fact there is almost no fact, even Labour’s dodgy figures selectively created from a dataset stolen from Barfoot & Thompson aren’t facts.

So what are the real, empirical and demonstrable effects of offshore Chinese buyers in the market?

Paul Walker explains that there are none:

With all the xenophobic rubbish we are getting from Labour and bizarre calls for bans on foreign ownership of housing by the likes of the BNZ’s Tony Alexander I find myself asking, But what is the actual effect of foreign buyers on the prices of homes?  Read more »

Raybon Kan on Labour’s race-baiting dog-whistle policy

Raybon Kan writes in a newspaper about Labour’s race-baiting dog-whistle policy against Chinese.

Being Chinese in New Zealand always puts you on the back foot. We don’t play the race card: we show up with it stuck to our face. So, when mainland Chinese house-buyers are accused of being the nation’s problem, I can’t help but feel attacked as well. Because I don’t entirely buy it when you say it’s not about being Chinese in the face. We know what you mean when you say foreign ownership. You don’t mean state houses being sold to Australia. You don’t mean Canadian pension funds. You don’t mind the white: you don’t see the white. White is how things should be.

There’s a pattern. Historically, Chinese have never been welcome. From the gold miners and railway workers who weren’t allowed to bring women, to the Poll Tax, we’ve always been singled out for worse treatment. And easily so: Well, look. The people who attack mainland Chinese house-buyers say they’re not being racist – they say they’re being economist. But I bet if a wave of white investors showed up and paid way over the odds for houses, you’d be thrilled.

Whatever the valuations now, I think we’ll look back on today’s million dollar prices as mere blankets and beads. You think mainland Chinese house-buyers are rich now? These ones are Communists. You think there’s a lot of Chinese now? This is how many there are under a one-child policy. Imagine if we tried. We can’t win. If Chinese buy houses and pay you too much – you don’t like it. If Chinese in China buy houses over the phone, pay too much and don’t even move here – you don’t like it. What do Chinese people have to do?

No wonder you see lots of Asians at Auckland house auctions. It’s the only time in New Zealand that Asians get shown any love. In fact, if I’m ever in Auckland and feel depressed, I’ll pop into a house auction, just for the hugs.

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