Chris Nixon: NZIER Principal Economist on the slowing Chinese investment in NZ

Chinese investment in New Zealand is growing, but slowly. 

The New Zealand China Council’s annual report shows China ranks 12th as a source of foreign investment in New Zealand, providing less than 1% of total inflows. 

Investment grew 9% a year between 2014 and 2024, but has flat lined since 2019. 

NZIER Principal Economist Chris Nixon told Ryan Bridge the problem is that investment is a long-term game, so other countries have a greater advantage.  

He says we've been trading with China for the last 20 years so it will take time for the relationship to build.  

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Episode Transcript

Speaker 1 (00:00):
Chinese investment in New Zealand isn't as robust as you
might think it is, but it is growing sort of.
A new report from the Chinese Business Council and INSIDIR
shows China ranks twelfth for direct foreign investment to New Zealand.

Speaker 2 (00:13):
Growth averaged about nine percent a year over the past decade,
but it has been flattening or declining since COVID. Chris
Nixon is principal economist at ENSIDII and with me this morning. Morning, Chris,
good morning. The fact investments.

Speaker 1 (00:27):
Slowing is them not us, right, Like they're not investing
as much globally.

Speaker 3 (00:32):
I think that's right. But our investment with China is
also growing rather slowly as well that our trade numbers.

Speaker 1 (00:42):
Yeah, they are our largest trading partner, but then only
twelfth on investment.

Speaker 2 (00:46):
Is there normally a stronger relationship between the.

Speaker 3 (00:48):
Two well, I mean the problem here is that investment
is a long term game, and with other countries who
have traded for Australia, for example, for over one hundred
and fifty years, they have a much greater advantage than
the Chinese. Because we've only really been training trading with

(01:11):
the Chinese for the last twenty years, so you would
expect that it will take time for the relation to
ship to build.

Speaker 2 (01:22):
Chris, what do they want to invest in?

Speaker 3 (01:26):
Well, I think they if you look at the spread
of investments so far, they are investing in almost everything.
I think there are going to be opportunities for New
Zealand to invest in China and China to invest in
New Zealand in all sorts of things like what Well,

(01:50):
for example, New Zealand has invested in dairy in China,
also in things such as pet food in New Zealand.
It's pretty clear that I've invested in consumer goods given

(02:10):
that twenty one percent of our trade comes from China.

Speaker 1 (02:15):
John McKinnon says we're entering a no stone unturned period
of investment attraction here and we've seen announcement after announcement
from the government on you know, basically come here, invest, emigrate, spend,
We're open for business. Do you think the message is
getting through?

Speaker 3 (02:33):
Well, look, I mean I'm not really that focused on
the short term. I want consistency over the long term.
We need because it's a long term business. We want
consistency between as governments change in New Zealand, so our
bipartisan approach is really important and are consistent bipartisan.

Speaker 2 (02:57):
Approach Do you think we'll get that?

Speaker 3 (03:00):
Well, time will tell, but I mean it's my advice
as an economist to point this out.

Speaker 2 (03:08):
Message hurdlard and clear.

Speaker 1 (03:09):
Chris Nickson, thanks for your time this morning, principal economists
at ENZIR and those new numbers this morning. For more
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