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So, who should own good farmland and who should have the right to buy it? The changes that have happened in key food-producing countries have been largely ignored in Europe. But while the world has opened up, prices broadly equalised across countries and increased market access granted to the most competitive producers in the world, the whole question of land ownership rules has remained under the radar.
It was the recent visit of New Zealand minister David Parker that really brought it home to me.
With New Zealand milk prices having gone from 50% of EU levels to pretty well full parity over the last 15 years, mainly due to static EU prices and the dramatic increase in milk consumption in developing countries, especially China, New Zealand’s agricultural land and property has become attractive to foreign investors.
Property, in the form of land, cannot be bought by non-New Zealand citizens
The response of the new Labour New Zealand government has been swift and decisive. Property, in the form of land, cannot be bought by non-New Zealand citizens. On a recent visit to Ireland, the New Zealand minister for trade, who also holds the post of attorney general, was utterly unapologetic for the move and a special government office to supervise the investment by foreigners in New Zealand has been set up.
In the case of forestry, normally the sale of the standing trees to a foreign buyer is permitted, but the sale of the land on which the trees stand is forbidden
As well as agricultural land, the acquisition by non-New Zealanders of houses and scenic property in tourist locations is also banned. The purchase of agricultural processing plants in either meat or dairying will be decided on a case-by-case basis. In the case of forestry, normally the sale of the standing trees to a foreign buyer is permitted, but the sale of the land on which the trees stand is forbidden.
New Zealand is not alone in this area. Brazil has a long-term policy in this area and over the last few years, Argentina has introduced the same restrictions on non-national ownership.
In Europe, the European Parliament has issued a long report on the whole subject but broadly recognised that land policy was a matter for the individual member states
The key question for Irish and European policymakers to ponder is why should increased access to European markets be given to countries where access to the means of agricultural commodity production is increasingly restricted.
In Europe, the European Parliament has issued a long report on the whole subject but broadly recognised that land policy was a matter for the individual member states. The actual reality is that low returns to farmers in Europe have made the attraction of a new generation into farming much more of a problem. The key issue is how should food prices and imports be regulated in a high cost and environmentally conscious Europe.
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