Forum Archive Index - April 2000

["james.chamley" <james.chamley@xtra.co.nz>]

Hi all

As with some of the previous respondents to this subject the I see that
the level of foreign ownership of New Zealand stocks is something for us
all to be aware, if not wary of.  

If you fly over New Zealand you will see the vast tracts of forest that
now reside in the hands of International Paper and (soon possibly)
Norske Skog.  Maybe in time New Zealand will find industries to replace
the jobs that have been shed (or largely simply exported) but we run the
risk of ending up with a country with no asset base from which to create
those businesses.

Unfortunately "comuh" may be correct (if not politically correct).  This
government moves towards the left with frightening rapidity. 
Totalitarian governments have the hallmark of not allowing (or certainly
not listening) to criticism.  Margaret Wilson's interview last week on
television regarding the Employment Relations Bill showed that this
government will not tolerate opposing viewpoints and is determined to
push ahead with its thinly disguised socialist manifesto.

Any environment that is anti-business must also have a detrimental
effect on the capital markets of that country.

All in all the Employment Relations Bill and changes to other
legislation make New Zealand a politically unattractive place in which
to invest.  As political risk mounts the opportunities for New Zealand
companies to be repriced upwards, in my view, diminish.  End result is a
capital market that continues to under perform the world bourses.

If foreign investors buy out New Zealand companies IMHO this will
continue to be at depressed prices.

I apologise to those who feel that this forum is no place for political
comment however the poitical environment is critical to the sharemarket
and the success or failure of any business in that country.

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