New Zealand: A Strategic Opportunity for APAC Investors

New Zealand, known for its natural beauty, also offers a robust and attractive environment for business, and can be particularly attractive to investors from the Asia-Pacific (APAC) region. The country’s top position in the World Bank’s Ease of Doing Business index highlights the streamlined nature of its regulatory framework. Establishing a business in New Zealand usually involves just one procedure (incorporating a company), which can be typically completed within a day (after AML requirements are satisfied if the company is incorporated by a professional body), underscoring the efficiency of its business landscape.
 

Reliability for APAC Investors

A key aspect of New Zealand’s appeal is its well-structured financial system, which ranks first globally in ease of accessing credit. The country’s advanced credit reporting mechanisms and strong legal protections for both lenders and borrowers provide a secure environment for business operations. For APAC investors, this reliability in credit access is crucial, particularly when planning for expansion or navigating uncertain markets.
 
New Zealand’s commitment to fairness and transparency is further reflected in its high ranking for protecting minority investors. This legal framework ensures that all shareholders, including minority stakeholders, are treated equitably, which is particularly important for foreign investors looking for long-term security in their investments. Large foreign investors may also be able to obtain NZ residency through the Active Investor Plus Visa programme.
 

Attractive Property Market

The property market in New Zealand is also noteworthy, with the country ranking second globally in ease of registering property. The process is efficient and cost-effective, making it a favourable option for investors interested in real estate. While there are restrictions placed on the types of properties an overseas investor can purchase in NZ by the Overseas Investment Office, some exemptions are available through either obtaining a residence class visa or by buying certain apartments off the plans, buying land to build houses on, buying commercial or investment property. These rules are complex but once worked through. whether for commercial or residential purposes, the low barriers to property ownership enhance the attractiveness of the market.
 

A Range of Tax Incentives

One of the standout features of New Zealand’s business environment is its taxation framework, which is designed to encourage investment. The corporate tax rate stands at a competitive 28%, and unlike many other jurisdictions, New Zealand does not impose a general capital gains tax. This provides a clear financial advantage, particularly for investors seeking capital appreciation. Furthermore, the country offers a range of tax incentives, particularly in the area of research and development (R&D). Companies can benefit from tax credits covering up to 15% of eligible R&D expenditures, which significantly reduces the cost of innovation and fosters a culture of continuous improvement.
 

New Zealand Trade and Enterprise (NZTE)

Government incentives extend beyond taxation. New Zealand actively encourages foreign investment through a variety of grants and support programmes. The New Zealand Trade and Enterprise (NZTE) offers tailored support for international businesses, including funding opportunities, mentoring, and market insights. Additionally, the government has streamlined the visa process for investors and entrepreneurs, making it easier for businesses to bring in key personnel from abroad. This comprehensive support system ensures that APAC investors can navigate the New Zealand market with confidence, knowing that they have access to the necessary resources and assistance.
 

A Gateway for Opportunity

Geographically, New Zealand’s position in the Asia-Pacific region offers strategic advantages. With strong trade agreements in place with major economies such as China, Australia, and the ASEAN nations, New Zealand serves as a gateway to both eastern and western markets. This makes it an ideal base for APAC investors looking to expand their global reach, with the added benefit of operating within a stable and transparent legal framework.
 
While New Zealand’s business environment is largely favourable, there are areas that warrant attention. The costs associated with electricity and the complexity of obtaining construction permits are notable challenges. However, the government’s ongoing regulatory reforms indicate a proactive approach to addressing these issues, aiming to further enhance the country’s attractiveness as a business destination.
 
In summary, New Zealand offers a comprehensive and well-balanced investment environment, characterised by regulatory efficiency, financial stability, and strategic location. For APAC investors, these features, combined with a supportive tax and government incentive framework, make New Zealand a compelling choice for long-term investment. As an Associate at Moore Markhams and a member of the Asia Desk, I believe that the opportunities in New Zealand are substantial, offering a secure and promising market for discerning investors.