Urgent but not desperate: Ministers make the big pitch to investors

Friday, 14 March 2025

**The Government is wooing international development companies at an investment summit in Auckland, **hoping to close NZ’s multibillion-dollar infrastructure deficit. Luke Malpass reports from day one.

ANALYSIS: So how many dollars worth of projects are needed to get a decent wodge of foreign capital into New Zealand?

According to Craigs Investment Partners head of investment banking Brett Shepherd, between $50 billion to $100 billion is what really “moves the dial”.

And this gets to the crux of the Government’s challenge in really supercharging capital investment into New Zealand: ensuring that there are enough projects over a short enough period to really gear up New Zealand for long-term foreign investment to help bridge the infrastructure gap.

To put that into context, of the projects earmarked as “investment opportunities” ‒ the Government has been keep to tamp down any talk of deals ‒ in the first day of the Infrastructure Investment Summit, the numbers were a multiple shy of that.

“Tens of billions is what we are looking for,” Prime Minister Christopher Luxon said. Talking to various investors on the sidelines, the vibe was positive, but very much wait and see. The rhetoric is good, the conversations open ‒ the messaging very consistent ‒ but let’s see what materialises.

Shepherd, who has been at Craigs for 12 years and was previous CEO of Deutsche Bank’s New Zealand operations, said that that is really the way to get a lot of investment in. And the question was whether the New Zealand Government, regardless of political stripe, can commit to ramping that up and creating a pipeline of investments

He cited the number of Australian public-private partnerships and the project pipeline in New South Wales. The lion’s share of those are in Sydney with a population not much greater than New Zealand, but obviously much higher intensity. For investors, he said that sustainability is crucial.

“You see this in New South Wales and a little in Victoria ‒ once it's seen as sustainable and they know that they can invest that capital, they keep investing that capital. What they don't like is coming, committing, and then you have a one-off, because it provides illiquidity.

“If there's liquid investment, so you're doing five of them, or seven of them over a 10-year period ‒ that's a lot of capital,” he said.

Patrick Mulholland from the infrastructure team at the Queensland Investment Corporation ‒ the Queensland Government’s sovereign wealth fund ‒ said that the sessions were open and useful for investors. Capital, he said, is not a commodity ‒ it needs a partner, and who or what organisation that is really matters.

QIC has about A$2.5 billion in investment in New Zealand in energy ‒ part of a bigger $8b energy investment. Mulholland said that getting the Overseas Investment Office processes sorted were crucial ‒ across three projects QIC invested in, he said that the average wait time for each was probably about five months and that the process wasn’t that transparent.

He said in large transactions where there were “hedging and other debt financing arrangements, knowing when the completion date is quite important, and even knowing if you can two weeks out is quite helpful for some of those practical considerations”.

He also noted that for an Australian investor, having projects in either New Zealand or Australia were always viewed favourably because the governments are stable and they are relatively easy to keep an eye on without setting up offices or engaging people on the other side of the world.

In a session representing iwi capital Jamie Tuuta, (Ngāti Mutunga, Ngāti Tama, Ngāti Maru, Te Ati Awa) laid out an expansive vision of where iwi capital sees its place in the firmament.

“We like infrastructure, particularly social infrastructure. Given we are large landowners, we'd like to have some exposure to the buildings that should come upon our land. Why? Because we're intergenerational or long-term. We have patient capital, like many of you.”

So how did it all go? Well, the summit got better the more the day went on. The start of the day was scene-setters from the prime minister and minister of finance, and much the same from David Seymour about the new ministry of regulation.

They could have been stump speeches just about anywhere. In one sense that was unavoidable. Those jobs are high level and macroeconomic.

Once it came down to ministers the vibe changed, much more into ‘have I got an opportunity for you!’.

Ministers then ran through future building and maintenance contracts to education, health, roading, justice and prisons.

The message was clear ‒ New Zealand is keen for investment into all of these things, what can make it work for you? It is worth noting that about half the companies present were from New Zealand. So it may well be the case, if there are takers for a bunch of projects and upgrades, they may be New Zealand-based funds.

If there is significant interest in some of these projects across the spectrum, then it becomes about the politics of investment ‒ read privatisation.

Simeon Brown’s pitch in health was that no one cares who owns a hospital as long as they get an operation or treatment in a timely manner. He is probably right, but the politics of it could prove less than straightforward. (Also amusingly, after National slammed the previous government for reforming and centralising the DHBs into Health NZ, Brown used the fact there is now one entity and more co-ordination as a significant selling point.)

The tone of the day was very much not ‘New Zealand for sale’. Instead it was more around the vision, here are our principles and here’s what we are into.

Now to see if the tens of billions the PM is keen for materialises into new projects.