AMP to invest overseas

Press, 15 May 1985, Page 40

AMP to invest overseas

PA Wellington The AMP Society — New Zealand’s largest institutional investor — may put up to 5 per cent of its total funds into overseas investments late this year, the manager for New Zealand, Mr John Dingle, said. Speaking at a press conference when releasing the society’s annual report, Mr Dingle said the society’s interests would be confined to share investment in Australia and probably in the United States, Japan, and Hong Kong. The society would later consider investing in commodities such as aluminium. “We haven’t yet made a firm decision — we are still in the throes of considering it. “If we do finally confirm that decision it would be a very small percentage of our total funds committed in one way in the first place. “If our experience is good, then there would be the opportunity to increase that percentage as time went by, but it would be very much a gradual process. “However, the society would remain committed to a strong investment presence in New Zealand. “The decision as to whether to invest overseas will be made next month. “This is an opportunity that has arisen as a result of the deregulatory thrust of the present Government, and provides an additional dimension to our investment strategy,” Mr Dingle said. However, he said the' society would continue to support New Zealand companies through share investment. Overseas shares, he said, would provide greater

diversification in the society’s equity portfolio.

“If we look overseas, we have the opportunity of taking a stake in the so called frontier stocks — in pharmaceuticals, electronics, aerospace ... in advanced techological companies not based in New Zealand. “We will also have the opportunity of buying into some world commodities that are not available here in New Zealand but which are significant influences on. the total world economy. “The much larger markets overseas will allow us greater flexibility in buying and selling our stocks. “Because we are a very large investor in a restricted market, our share transactions can have a very significant effect on the market and we make our decisions including consideration of wider responsibilities to the general investments and economic sphere. “Mr Dingle said tax reform was another area of great change in the economy.

“However, I do feel some real concern that so much of the debate and interchange on that taxation reform is now concentrated on technicalities and operating systems, and is losing sight of fundamental objectives. “But it does seem to me now that somewhere along the head long rush to reform, the focus has drifted away from careful consideration of just what those social and economic objectives really are,” he said in reference to superannuation. “Given the significant ageing of our population, changes in work patterns and life style, and the general recognition of the limits of current and future Government resources, this area is one of the most critical and sensitive areas that New Zealanders have to face. “It should be debated and discussed, and options and alternatives studied and evaluated. “Yet under the welter of debate over the goods and services tax (GST) the issue is almost being lost. And that is of very real concern to a company like ourselves that is so heavily involved in retirement planning and superannuation. “The signals from the Government are conflicting; on the one hand it has been made clear that the costs of the present national superannuation scheme cannot be continued. “It is probable that the same view will be taken by successive Governments. “If that is so, then the only alternative to State support is greater encouragement to self-help and self-provision during the earning years,” Mr Dingle said.