Billionaire Trump adviser Peter Thiel's New Zealand citizenship stokes political debate

PayPal co-founder Peter Thiel speaking on the US presidential electino in Washington on Oct 31, 2016.
PayPal co-founder Peter Thiel speaking on the US presidential electino in Washington on Oct 31, 2016. PHOTO: REUTERS

WELLINGTON (REUTERS) - New Zealand's ruling centre-right National Party is heading into an election campaign plagued by questions over a decision to grant citizenship to Peter Thiel, a billionaire tech tycoon and adviser to US President Donald Trump.

Thiel was granted citizenship despite not meeting the normal requirement to live in the country for 75 per cent of the time over five years, a fact that would normally disqualify an application.

Centre-left Labour opposition member of Parliament Iain Lees-Galloway said in a statement the granting of citizenship raised "serious questions as to why a New Zealand passport needed to be granted to a wealthy foreign businessman who does not live here".

Documents released this week showed the government granted Thiel citizenship under an exception to the rule normally requiring someone to live in New Zealand. German-born Thiel is based in California.

The government made about 92 similar exceptions in the past five years, according to the Ministry of Internal Affairs.

Thiel's citizenship has sparked heated debate among politicians and in the media, with migration fast becoming a main issue ahead of a Sept 23 election.

Booming immigration has helped the economy race along with some of the strongest gross domestic product growth in the developed world, but economists say it has also contributed to rising house prices and low wage growth.

The Paypal founder and early Facebook investor has invested in New Zealand start-ups, such as NZ$4 million (S$4.1 million) in accounting software firm Xero , and donated NZ$1 million to a recovery fund for the earthquake ravaged city of Christchurch.

Prominent members of New Zealand's technology industry - the country's fastest growing - defended the decision to grant Thiel citizenship, saying they sorely needed offshore capital and connections to compete globally.

"I don't think most NZ'ers understand just how valuable opening up to foreign investment and talent networks really is to us," Sam Morgan, an entrepreneur who founded online auction website TradeMe, said on Twitter.

"I want immigration policies that both protect our shared values and let us attract the talent and capital we need to succeed," said Morgan, who had provided a letter in support of Thiel's citizenship application in 2011.

Developing the IT industry, New Zealand's third largest export which contributes NZ$16 billion towards GDP, has been a priority in the government's attempt to diversify the economy away from a traditional reliance on dairy exports.