An ACT MP says New Zealand is "like North Korea without the nukes" in terms of its openness to foreign investment.
The political party on Thursday released a document outlining nine proposals to bring down the cost of living. New data out this week revealed annual inflation has jumped to 7.3 percent, the highest level in 32 years.
One idea to address rising food prices - up 6.6 percent between June 2021 and June 2022 - is to exempt OECD members from the Overseas Investment Act to allow foreign supermarket chains a streamlined process to invest in New Zealand. The Act regulates foreign direct investment into New Zealand to ensure "responsible investment".
The Commerce Commission earlier this year reported on a lack of competition in the grocery sector. The Government took on its recommendations, including introducing a code of conduct between suppliers and grocers and banning restrictive land covenants that chains have been accused of using to stop others from entering the market.
But ACT's associate finance spokesperson Damien Smith says there are other factors causing hurdles to new players coming to New Zealand.
"No sane company would come to New Zealand to develop a supermarket chain unless it was allowed to develop a full-service grocery model," he said.
"That means the RMA has to be modified to allow this to happen. It means we need to attract foreign investment from friendly OECD countries that can be fast-tracked here. At the moment, it is like North Korea without the nukes trying to get money into this country."
He said the policy excluded the purchase of residential property.
Asked to explain his North Korea comment, Smith said New Zealand isn't well-placed internationally in terms of attracting foreign capital similarly to some countries in the Middle East and North Korea.
"We need another leg to the economy. We need more income in this country and we can't tax and prosper. We actually have to bring in capital. My analogy there is that, it's just difficult to bring it in and it's the same as in those countries."
ACT leader David Seymour said he didn't think "any of us could be truly innocent of calling different countries the hermit kingdom from time to time".
He pointed to overseas rankings showing New Zealand had a restrictive foreign investment regime.
An OECD index on foreign direct investment places New Zealand in the top 10 most closed, alongside the likes of Jordan, China and Malaysia. However, Our World In Data shows foreign direct investment into New Zealand as a share of GDP is higher than the international average.
"While clearly we don't share any of the other dreadful characteristics of North Korea, in respect of foreign investment, which is the topic today, we are almost as closed as they are," Seymour said.
"That is something that New Zealand needs to address if we want to get investment and ideas, get more competitive and fight the cost-of-living crisis."
Among ACT's other ideas to tackle the cost of living is abolishing trade tariffs, simplifying the tax system, and making it easier for employers to bring migrant workers into New Zealand.
