The Māori economy, conservatively estimated at around $37 billion, is growing rapidly due to the creation of large, asset-rich Māori corporates from Treaty of Waitangi settlements, partnerships and joint ventures with outside partners, and a new government-led Māori economic growth strategy.
Waikato-Tainui in the central North Island and Ngai Tahu in the South Island were the first iwi to conclude Treaty settlements, in 1995 and 1997 respectively. Both settled for $170 million. Tainui has since grown its asset base to $738 million and Ngai Tahu to almost $748 million.
Fifteen Treaty settlements were completed in 2012/2013. Only 60 iwi are yet to settle, and they are all engaged at different stages in negotiation with the Crown. The settlement process has been long and at times arduous, and has some distance yet to run, but an end is now in sight.
Māori control 37% of New Zealand’s fishing quota, and own 36% of forests planted before 1990. These holdings were established through the ‘Sealords Deal’ in 1992 (the Treaty of Waitangi settlement relating to Māori fishing rights) and the ‘Treelords Deal’ in 2007 (the Treaty of Waitangi settlement under which the Kaingaroa Forest was transferred from the Crown to central North Island iwi).
Māori also produce 7.4% of New Zealand’s agricultural output, and could produce more – especially on communally owned land covered by the Te Ture Whenua Māori Act, up to 80% of which is considered to be under-performing. Some of this under-performance is due to the cumbersome decision-making procedures required by the Act. These are currently being reviewed with a view to unlocking the land’s potential.
Iwi corporations bring a distinctive ethos to the conduct of their business and take a long-term, multi-generational perspective. In business, this is often described as the quadruple bottom line – with environmental, cultural, social and economic considerations assigned equal importance. Land which has cultural significance will not be sold and environmental sustainability is a key consideration in the management of natural resources. These values mean that iwi corporations and Māori businesses are generally conservative investors.
As Ngai Tahu Chairman Mark Solomon put it: “We are simply not interested in partnering with those who would place too much risk in the hope of a short-term gain. I have often said that the national and local governments are logical partners for iwi, and that there is much untapped potential in the delivery of health and well-being services and infrastructure”.
China has been a particular focus for many Māori corporates. The Minister of Māori Affairs, Pita Sharples, who told a recent Hong Kong trade delegation that the Māori economy was “wide awake and hungry for business”, has led two successful Māori trade delegations to China in the last three years and believes that Māori have an “edge” in relation to Asia.
Māori are thought to have originated in south-east Asia and there are striking cultural resonances, in particular the high value both cultures assign to genealogy and to respect. There is also a natural synergy between resource poor Asia and resource rich Māori.
Other avenues for Māori to maximise the returns from their asset base are joint ventures and other partnerships with investors who can bring capital, value-added processing and employment opportunities, and market access.
Some recent examples include:
- joint ventures between the Iwi Collective Partnership (a consortium of 12 iwi) and each of Sanford and Aotearoa Fisheries Limited, which gives the participating iwi critical mass and increased negotiation strength in the fishing industry
- a joint venture between Shanghai Pengxin and Miraka, a Māori-owned milk powder plant, to process milk into UHT products for the Chinese market
- a partnership between Tong Ren Tang Pharmaceuticals and Manuka, a Māori-owned honey producer, to retail Manuka’s honey-based health products in China, and
- discussions between CNI Iwi Holdings, representing the tribes entrusted to manage Kaingaroa Forest, and China National Building and Materials about the establishment of a soft wood processing plant to process the wood on site.
As a result of these and other initiatives, Māori Inc is now widely recognised in New Zealand as being key to the growth and success of NZ Inc. The Government has recognised this in He Kai Kei Aku Ringa, a Crown-Māori economic growth partnership.
‘He kai kei aku ringa’ translates to ‘self-generating well-being’, and the strategy and accompanying action plan is aimed at creating the right setting and opportunities for this to occur. The focus is on the private sector being the driver of economic growth, and the Government facilitating that growth by creating a supportive business environment.
This article first appeared in Australasian Legal Business (ALB) online.