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New Zealand

NZ Cannabis Reform

Things are looking up for cannabis users in New Zealand as the country's recently elected prime minister has openly stated that she wants to initiate a national discussion surrounding the legalization of cannabis. Jacinda Ardern, who became the 40th prime minister in October 2017, has declared her intentions to work in conjunction with her Cabinet to take advice on the subject before making a final decision on a date for a referendum. 

As the leader of the New Zealand Labour Party, she is currently governing the nation as part of a Coalition government with the NZ First Party and supported by the Green Party of New Zealand. Although the proposed changes to legislation regarding cannabis use are driven by a Green Party manifesto stating the drug should be legalized for personal use, including its cultivation and possession, during her election campaign, Ardern was very frank about her opinion that people should not be imprisoned for using cannabis. However, she also expressed her concerns about young people having access to a potentially harmful product. As part of the Green Party manifesto, an age limit was proposed to be introduced for personal use, and proposals for the removal of penalties for people who were growing their own marijuana for medicinal use.

Ross Bell, the New Zealand Drug Foundation's Executive Director agrees with the Prime Minister that a new look at the nation's drug policy is long overdue. In polls carried out by his organization, he has seen that 65% of respondents are keen to change the law as it currently stands, which is more than four decades old.

However, while he is in favour of the Green Party's interest in opening discussions into the subject, he also cautioned that it was necessary to acknowledge that cannabis can have a harmful effect on society, and that a wholesale move to a free-market arena, in his opinion, would be a negative step.

The Canadian government has taken steps to legalize the use of cannabis in their country by 1st July 2018, however at the present time they are still struggling to satisfy their legal obligations internationally. Canada has already legalized the use of medicinal cannabis, but strict guidelines are being put in place, with cannabis oil, fresh and dried flower being initially available with edibles set to follow. Canada has also stated that they will be putting clear guidelines into practice regarding the marketing of marijuana products, although as yet there have been no final decisions about whether plain and child-proof packaging will be used and whether endorsements will be banned. Whatever the final decision on that matter, there will be strong prohibitions on marketing which could prove to be appealing to young people, and there will be no selling through vending machines or self-service display cases permitted. There will also be limits set for those who want to cultivate their own cannabis plants, with a maximum of 4 plants per household implemented, and only 30g of dried cannabis solely for personal use will be permitted to be carried. Anyone found selling or giving cannabis to a minor or who drives under the influence of the drug will face a stiff penalty.

Although the timing of any referendum has not been determined, it has been suggested that the vote will take place before 2020 if at all possible. The changes that the public will be voting on include:

  • Legalization of cannabis for personal use, including its cultivation and possession – at the present time, it is still unclear whether or not the selling of cannabis would be made legal.
  • Age restrictions on the use of cannabis, with a legal age limit being introduced for personal cannabis usage. That age, however, has not yet been agreed on or set.
  • Driving after using cannabis – the existing law about driving under the influence of marijuana would be replaced, and a new law which is based on the correlation of cannabinoid levels and impairment would be introduced

Should Kiwis vote yes on the legalization of cannabis, the following changes would be put in place.

 

·         Medical cannabis would be legalized, with penalties being removed for anybody suffering from a debilitating, chronic or terminal condition who possesses, grows or uses marijuana products for a therapeutic purpose, so long as they are supported by their medical practitioner.

·         Licensed medicinal cannabis products will become more accessible, with the process through which medicinal cannabis products are licensed being accelerated and the barriers being lowered for manufacturers to submit their new cannabis-based products to Pharmac for funding so evidence can be gathered rapidly and then more speedily distributed when approved.

 

However, before taking any decisions with regard to a referendum date, the New Zealand government want to assess the evidence provided from overseas jurisdictions which have already legalized the sale of cannabis in order to determine the right model for their own country.

 

The policy would remove penalties for medicinal use while broader changes in legislation for cannabis use were still in the pipeline, however there would be other steps taken under the terms of the policy to help avoid the problems associated with drug use, including free counselling to be introduced for people under the age of 25, greater access to mental health support and services across the entire community, welfare system overhauls and increased access to drug and alcohol services for all.

Although no final decisions have been made yet about a referendum date or the final details of the policies being voted on, it seems clear that there has been a shift in both public and political opinion around the use of cannabis, and certainly for medicinal purposes, which will serve to benefit existing users before the end of the decade.

This also creates an amazing opportunity for people wanting to invest in New Zealand who want to be a part of what will become a boom industry. If New Zealand gets to the front of the queue, this will be a major economic boom for New Zealand.

 

New Zealand Government Update

After one of the strangest elections in New Zealand history, New Zealand finally has a government. Labour's Jacinda Ardern has been crowned New Zealand Prime Minister by Winston Peters and New Zealand First. 

Through this, we will go through the structure, the policy information we have and what the implications are for National. 

Structure

The Government will be a Labour - NZ First government that has a confidence and supply agreement with the Green Party. This is not a Labour - NZ First - Green government as many commentators are stating. There is a Labour - NZ First Coalition agreement which is looking to give Winston Peters the Deputy Prime Minister job (the same job he held under National under Jim Bolger). New Zealand First will get four ministerial positions (it is unclear if this includes Winston or is including Winston) and one Parliamentary Undersecretary. 

The Ministries that New Zealand First will get are:

• Foreign Affairs
• Infrastructure
• Regional Economic Development
• Internal Affairs
• Seniors
• Defence
• Veterans' Affairs
• Children
• Forestry
• State Owned Enterprises
• Racing
• Associate Finance
• Associate Education and an Under-Secretary for Foreign Affairs and Regional Economic Development

The Greens have a confidence and supply agreement with Labour. This government represents the first time that the Green Party have had Ministers, even if they are outside the cabinet. 

The Ministries that the Greens will get are: Climate Change, Associate Finance, Conservation, Women, Land Information New Zealand, Associate Environment, Statistics, Associate Transport, Associate Health and an Undersecretary to the Minister of Justice (Domestic and Sexual Violence).

Prime Minister - designate Ardern has dismissed the fact Climate Change as a minsitry is outside the government as something she can do as she doesn't need convincing on the subject.

The full roll out of Ministries will happen at the swearing in ceremony later this week. 

Considering the Labour gains from the Maori Party, the Maori Development portfolio is one that is promoting a lot of speculation as to who will receive that portfolio. This considering that Deputy Labour Leader, Kelvin Davis is likely to pick up Corrections as one of his portfolios in the government. 

Today the Labour - NZ First agreement and the Labour - Green agreements were both signed. 

Here are the substantive policies inside the agreements:

• Regional development: A $1 billion per year Regional Development (Provincial Growth) Fund

• Rail: Significant investment in regional rail.

• Forestry: Re-establish the New Zealand Forestry Service, and planting 100 million trees per year in a Billion Trees Planting Programme.

• Auckland Port: Commissioning a feasibility study on moving the Ports of Auckland to Northport

• Biosecurity: A funding increase to Biosecurity NZ and a select committee Inquiry into biosecurity

• Irrigation: Honour existing Crown Irrigation investment commitments

• Monetary policy: Review and reform the Reserve Bank Act

• Minimum wage: Increase to $20 an hour by 2020, with the final increase to take effect in April 2021

• Tax: Increase penalties for corporate fraud and tax evasion, and introduce a tax on exports of bottled water

• KiwiBank: Investigate KiwiBank's capabilities to become the Government's banker when that contract is next renewed.

• Foreign ownership: Strengthen the Overseas Investment Act and create a comprehensive register of foreign-owned land and housing

• Research and development: Increase R&D spending to 2 per cent of GDP over 10 years

• Health: Re-establish the Mental Health Commission, annual free health checks for seniors with the SuperGold card, free doctors' visits for all under 14s, increasing the age for free breast screening to 74

• Education: Restore funding for gifted students and Computers in Homes, pilot counsellors in primary schools, free driver training for all secondary school students, restart Te Kotahitanga teacher professional development

• Defence: Re-examine the Defence procurement programme

• Housing: Establish a Housing Commission

• Law and Order: Work towards 1800 new police officers over three years, investigate a volunteer rural constabulary programme, increase funding for Community Law Centres, establish a Criminal Cases Review Commission

• Social Development: More funding for family violence networks, including Women's Refuge and Shakti, pilot a Youth Education, Training and Employment programme and provide 800 extra places for the LSV scheme, introduce Ready for Work programmes

• Superannuation: Keep age of eligibility at 65

• Environment: Move to an emissions-free government-vehicle fleet by 2025/26, introduce a Zero Carbon Act and independent Climate Commission, which will consider including agriculture into the ETS, establish a tyre stewardship fund, piloting alternatives to 1080, work towards a Kermadec Ocean Sanctuary

• Conservation: More funding for the Department of Conservation

• Democracy: No new parliamentary building this term, an independent review of electoral processes and enrolments, and a review of the parliamentary processes, and pass a 'Waka Jumping' bill

• Immigration: Ensure work visas reflect skills shortages and cut down on low quality international education courses, and take action on migrant exploitation, particularly international students

• Pike River: Commit to re-entry to Pike River

• Other: Build a Maori Battalion museum at Waitangi, review retail-power pricing, allow a conscience vote on a NZ First euthanasia referendum bill, a Public Inquiry "a decade after Shand" to investigate the drivers of local government costs, support NZ First's racing policy, work towards a Free Trade Agreement with the Russia-Belarus-Kazakhstan Customs Union, record a Cabinet minute regarding the lack of process followed prior to the National-led government sponsorship of UNSC2334, concerning the Israeli settlements in Palestinian territories occupied since 1967

The New Zealand Green Party and Labour have a separate confidence and supply agreement which has a number of policy concessions in them in return. These include:

• Climate Change: Introduce a Zero Carbon Act and establish an independent Climate Commission (which will also look at transitioning to 100 per cent renewable electricity by 2035), analyse all new legislation for climate impact, establish a Climate Change board of public sector CEOs and a set of indicators for environmental, social and economic sustainability

• Transport: Investigate a Green Transport Card to reduce the cost of public transport for low-income people and welfare recipients, prioritise National Land Transport Fund towards rail infrastructure as well as cycling and walking, cancel Auckland's East-West motorway link, work towards light rail from Auckland city to airport

• Green economy: Government-backed Green Investment Fund of $100 million to stimulate up to $1 billion of new investment in low carbon industries by 2020, assist agricultural sector to reduce biological emissions and improve water quality

• Environment: Increasing conservation funding and predator control, commit to minimising waste to landfill by reducing all waste classes by 2020

• Rivers and lakes: Stronger regulation to clean up waterways, fund freshwater enhancement, wind down Government support for irrigation, better enforcement of the Resource Management Act

• Ocean Sanctuaries: Work with Maori to establish the Kermadec Ocean Sanctuary as well as a Taranaki blue whale sanctuary

• Welfare: Ensure access to entitlements, remove excessive sanctions, review Working for Families, provide safe sleeping environments for vulnerable families

• Health: Free counselling for under-25s, increase funding for alcohol and drug addiction services, referendum on the personal use of cannabis by the 2020 election

• Education: Ensure children with special needs and learning disabilities can fully participate in school

• Pay equality: Eliminate the gender pay gap within the core public sector

• Homes: A rent-to-own scheme will be part of Labour's Kiwibuild programme, increase in the number of homes insulated

• Refugees: Adequately fund and support family re-unification for refugees

 

New Zealand Election: Final Update

With New Zealand heading to the polls after what has been one of the more tumultuous campaigns since the advent of the MMP voting system; New Zealanders go to the polls. 

The basic tenants of tomorrow in our analysis go like this:

  1. The current governing arrangement (National - United Future - Act - Maori Party) will not be returned, despite this being Bill English's preferred option.
  2. The Labour-Green alliance under the Memorandum of Understanding is unlikely to be able to govern in its own right. 

United Future will lose its place in Parliament after Peter Dunne announced he was retiring as the MP for Ohariu and United Future not polling at the 5% threshold to get a List MP elected.

Whether or not Hone Harawira and his Mana Party can get elected in Tai Tokerau on the back of the 2 for 1 campaign he is running and whether or not the Maori Party can get 2 MPs back into Parliament will be critical in the dream scenario of the left where they can govern with a Labour-Green - Maori - Mana block. 

The fact remains: It is most likely that Winston Peters and his New Zealand First Party will become the King or Queenmaker to form the next Government of New Zealand. 

Winston Peters has governed with both National and Labour previously. He served as Deputy Prime Minister to Jim Bolger and Foreign Minister to Helen Clark in her third government. 

Winston Peters has already stated that he will not enter into a government with the Green Party. 

This means that the likely situations for the next government are:

  1. National - NZ First
  2. New Zealand First- Labour (with Greens in a Supply Agreement)
  3. Labour - Green - Maori - Mana

This is how we see the most likely scenarios, however, picking the combination from an MMP election is always difficult and predicting the results of negotiations to happen on a hypothetical equation of the Parliament is even more fraught.

Our team will be tweeting tomorrow night as the results come in 

NZ South Island Opportunities

New Zealand is full of different resources. New Zealand has some beautiful cities with various types of resources. One of the best cities is South Island. This city is a real attraction for the tourists. In every year, this city receives a lot of tourists from different countries. There are so many sectors which can be developed for the tourists. Geographically this is a perfect place to invest in various sectors. If you are looking for some areas of New Zealand, you should spend in this city. Here I am sharing some of the areas where you can invest without any doubt. You will receive a good ROI for sure.


Tourist Attractions
Tourism sector of South Island is the best way to start investing. There are so many places where every year people come to visit some amazing landscapes. You can invest on the resorts. Some of the resorts are developing newly, and they needed money. You can contact them to know if there is any chance to spend. Most of the resort will give you a particular percentage of the amount of your invested money. Famous tourist attractions of South Island are sightseeing, adventure tourism, such as glacier climbing and Bungee jumping, tramping (hiking), kayaking, and camping. In every section, there is a good chance to invest. In the areas of these tourist attractions, you can invest in the bars, hotels, sports shops, souvenir shops, etc.


Transport
As a tourist city, South Island is also a good place to invest in the transportation. You can spend your money to bring some updated transport system. The South Island has a State Highway network of 4,921 km which is quite large. You could contact the local transport companies if they needed any investment. But if you want to invest for the new transports, you need to get the permit from the authority. For this, you can contact with some legal advisors to know about the rules of transport business.


Real Estate
Real State is another attractive sector for the new investment. There are so many companies in New Zealand. For real estate properties. You can find out some amazing places where you can purchase some land or apartments. You can build resorts for the tourists on your lands. If you are a foreigner and want to invest in the real estate sector, you need to fulfil some requirement at first. If you find the work complex, you can contact the local lawyers to make it easy.


Restaurant Business
The restaurant is always a good business for high ROI. You can invest for the new restaurants in South Island. You can set up a new restaurant in the tourist spots. You can contact with the landowners for setting up a new restaurant. Though there are already some popular restaurants in there, if you can bring some unique items, you can expect a good return on your investment.
 

Wellington Startups. A new opportunity.

New-Zealand is one of the most business-friendly countries in the world. Because of enough resources in the country, there are so many startups are growing up. In New Zealand, you will get the maximum benefits as an entrepreneur. There are some cities in New Zealand which are playing a vital role to increase the startups in New Zealand. One of the most startup-friendly cities in New Zealand is the Wellington City. You will find almost any type of resource and support which you needed to start a small business.

In Wellington, you will find so many industry leaders; they will encourage you and provide you the proper guidance for your business growth and success. This is not a big city, and the population is fewer, but the environment is perfect for the startups. The best part of Wellington city is the business and start up community. Managing a business load is so much easy in this city if you have a fabulous idea. The only thing you need to do is generate a decent idea and make a proper plan for the implementation.

Why are Start Up Companies Growing at Wellington?

Startup Community: There is a startup community in Wellington which is a network of collaboration which is significantly helpful for new startups. They also celebrate startup weekend where they arrange entrepreneur’s events. There is a chance to meet with the influencers. That means, there are opportunities to share experience with the real entrepreneurs. Also, have web stock which is an annual technology conference with international guests.

Supportive: As an entrepreneur, I love the supportive people of this city. When you are a new entrepreneur and going to start a new small business, you needed care from different types of individuals. That is why Wellington is the best place to initiate the business. There is a wide range of organizations, and they arrange boot camp and other business related conference for the newbies. Sometimes you also need some financial support to carry on your business, and some organizations have made this process easier. 

Startup Programs: In Wellington, there are so many incubator and accelerator programs arranges in all the time of a year. This is a perfect way to gain some knowledge for your future business. Here you will learn where to invest and where you shouldn’t spend. You will learn the basic things of the advanced stuff. Successful entrepreneurs share their success stories, and they also share the things which they have considered to start the business. Another thing which I love a lot is the networking probabilities. Maybe you will be able to arrange a good investment on your idea, or you will get a partner who knows some basic things about your idea better than you.

Without the above reasons, there are also some other opportunities which you will love a lot. If you have an excellent idea and you are confident enough, plan to start your business in Wellington in New Zealand for the maximum success. 

For all of your market access and entry strategy needs, click here to get in touch with the Gravis Global Invest team today!

 

 

Foreign Investment in New Zealand

With the scrutiny on foreign investment here in Australia, it would also be worth noting that New Zealand is undergoing a similar conversation about foreign investment in the 'Land of the Long White Cloud'. 

In New Zealand, this has been largely triggered by big investments into two sectors; Housing (particularly in Auckland) and into the famous Dairy Industry. KPMG found Canada accounted for 22 percent of overseas investment in 2013-2014.

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.

The report, Foreign Direct Investment in New Zealand: Trends and Insights is the second of its kind by KPMG and is based on Overseas Investment Office (OIO) decisions over the last two years. To read that report click here.

The issue of housing investment into the New Zealand housing market has become a big issue in New Zealand politics. This has caused the Key Government to introduce a suite of restrictions on foreign home buyers as fears rise about the effect of this investment on home prices, especially in places such as Auckland. 

In May 2016,  Land Information New Zealand (LINZ) released data which showed that 474 out 11,955 houses sold between January and March in 2016 went to non-residents.

Of the sales to foreign buyers, 276 houses went to Chinese residents. The next biggest investors were Australians, with 45 properties.

Across all of New Zealand, 3 per cent of houses sold between January and March went to people who were not New Zealand citizens or holders of a residency, student or work visa.

Chinese tax residents snapped up 321 of those properties (29.5 per cent of non-resident purchases), followed by Australians on 312 properties (28.6 per cent).

However, fears around loss of sovereignty and suspicion around the motives of Chinese buyers are prompting a rise in protectionist politics; from One Nation and the Greens on the right and the left of Australian politics and New Zealand First on New Zealand's right and the Greens on New Zealand's left. 

A large number of investments do not need approvals beyond the normal legislative business framework for New Zealand-based companies.

The Overseas Investment Act 2005 regulates the acquisitions by overseas entities of 25 percent or more ownership or control of interests of sensitive New Zealand land and significant business assets.

However, just as Australia has an independent Foreign Investment Review Board (FIRB), New Zealand has regulatory arrangements as to what needs higher 'testing' from government. These tests are unique to the growing economic circumstances New Zealand faces. New Zealand has seen as massive growth in its economy since John Key came to power after a long term of Helen Clark as New Zealand's Labour Prime Minister. 

These three tests are:

  • sensitive land (eg farm land, historical landmarks, regional parks)
  • significant business assets (eg New Zealand securities or assets, or the establishment of a business, worth more than $100 million)
  • fishing quota (an interest in fishing quota or securities in a person that owns an interest in fishing quota).

However, this is balanced by an efficient Department of Trade and Enterprise that can assist with investment into New Zealand successfully. 

Some of the services NZTE can provide include:

  • supplying general and customised reports on New Zealand investment opportunities, costs and regulatory processes for your investment
  • facilitating your visit to New Zealand by identifying potential investment targets and arranging suitable meetings, including introductions to other contacts in New Zealand (eg regional economic development agencies) that could support your investment
  • facilitating the selection of suitable sites for your investment project
  • helping coordinate your investment, including providing information and facilitating access to other Government assistance programmes, and helping to remove potential obstacles
  • providing information about potential New Zealand-based advisors or suppliers for your investment project

With our team having extensive dealings with New Zealand Government agencies, we are perfectly placed to assist investors in their regulatory engagement with New Zealand. If you would like to talk further, please click on the button below.