Maori leaders look for insights into Chinese investor intentions

A delegation of New Zealand indigenous Maori business leaders will be seeking a deeper insight and understanding of Chinese investor intentions when they travel to China next month.

The delegation led by Maori Trustee Jamie Tuuta has been invited by the head of Shanghai Pengxin Group, whose controversial bid to buy 16 North Island dairy farms is still under dispute in the New Zealand courts.

Tuuta told Xinhua the week-long trip from Oct. 8 came at a time of changing attitudes to foreign ownership of New Zealand agricultural assets, following low-key talks between Shanghai Pengxin chairman Jiang Zhaobai and Maori iwi (tribal groups) and business leaders in New Zealand in July.

Many iwi and Maori trusts and corporations were attracted to partnering with foreign equity and capital, but deciding the structure of such partnerships still presented challenges, Tuuta said in a phone interview.

Given that most iwi and Maori trusts were unwilling to sell land, Maori had to be more commercially astute than other farmers "because that's the way we are going to drive cash returns," said Tuuta.

"It's about reaffirming the constructs which are win-win for the capital partner and for Maori," he said.

The Maori Trustee is appointed by the government to head an organization that currently manages 2,000 trusts, companies, joint ventures and other entities, 100,000 hectares of Maori owned land, and 80 million NZ dollars (66.27 million U.S. dollars) in funds.

Charged with protecting and growing the assets of Maori landowners under his management, Tuuta said although some New Zealand land owners continued to have an insular view of the market, many realized they lived in a global economy and the Shanghai trip would give an insight into how they could integrate further with the international value chain.

"Maori own 37 percent of New Zealand's forest land and 36 percent of New Zealand's fishing quota," said Tuuta.

"We've also got a lot of land that can be converted to dairy. There are potential opportunities to convert forest to pasture. You don't necessarily have to sell the land. A lot of Maori are now becoming more market facing."

Maori also wanted to retain control over the traceability of produce and ensure the source was credited.

The small delegation of about six or seven people would be looking to ensure they could capture future opportunities.

"We place a huge importance on developing relationships and mutual trust and the chairman (Jiang) has the same view," said Tuuta.

"We're not going with particular business preparations to be discussed although there are some in the pipeline."

Tuuta said the Maori trust involved in the ongoing legal action to stop Shanghai Pengxin's purchase of the 16 Crafar Farms was not involved in his talks with the company.

The Tiroa Te Hape Trust has appealed the approval of the Chinese firm's purchase to the Supreme Court on the grounds that Shanghai Pengxin, which wants to purchase the farms through Hong Kong-registered subsidiary Milk New Zealand Holdings, lacked the relevant expertise and management experience to run New Zealand dairy farms.

The government had twice granted Shanghai Pengxin approval to purchase the farms following recommendations from its Overseas Investment Office, but both decisions were contested in court by the Crafar Farms Independent Purchasers Group (CFIPG), a consortium led by merchant banker Michael Fay and including Tiroa Te Hape Trust.

Shanghai Pengxin offered a reported 210 million NZ dollars for the farms in April last year, before the rival CFIPG offer of 171. 5 million NZ dollars was put to the receivers.

Last month, the Court of Appeal upheld an earlier court decision that Jiang, who owns 99 percent of the shares in Nantong Yingxin Investment Co. Ltd., Shanghai Pengxin's parent company, was a "successful entrepreneur" with a record of successful property developments and a "fast-growing agribusiness" with interests in China and South America.