August 14, 2018
Cultural investment affecting iwi returns
The ANZ Bank’s Māori business team says one of the hardest commercial decisions iwi face is whether to distribute or reinvest profits.
Its latest Te Tirohanga Whānui Māori investment research report found the commercial assets of the 34 iwi and hapu it tracks has increased by 12 percent or $1 billion since 2015 to stand at $5.4 billion.
Māori relationships head David Harrison says there is pressure to increase returns and distributions, driven by growing populations hungry to see the tangible fruits of their tribe’s treaty settlement.
Māori investment has historically been focused in farming, forestry and fisheries, but iwi are strengthening their footprint in other sectors such as tourism, horticulture and commercial property.
Those with big investments in large farms, often for cultural reasons, performed less well than iwi with significant holdings in managed funds, which have performed well in recent years.
He says about a third of iwi assets are in the primary sector, either because they were returned through settlements or were purchased for cultural reasons and are generally considered ‘not for sale’.
This places increased pressure on the rest of the assets to ensure they are allocated or re-allocated to best fit investments that provide greater returns with the right balance between income and growth.
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