Silver Lining To Importers Squealing
When the Importers Institute starts squealing for the Finance Minister to resign we should start looking out for a great new wave of investment in local production, says the Employers & Manufacturers Association (Northern).
"Importers have had a field day in New Zealand for at least a decade," said Alasdair Thompson, EMA's chief executive.
"Our economy is probably the most open in the world and this, together with extended periods when the NZ dollar has been overvalued, has seen consumers on a feeding frenzy on imports.
"We sold our state assets to pay for them, then mortgaged our houses to maintain our standard of living, and now all the Importers Institute can suggest as a remedy for indebtedness is for the Finance Minister to resign.
"It's simply ridiculous to ask Minister Cullen to resign just yet.
"The present situation has been building up over 27 years of accumulating current account deficits; 1974 was the last time we achieved a trading surplus.
"We agree the Finance Minister's enthusiasm stands in the way of his ability to listen to business, but the pressures on him now should help change this.
"We are optimistic the Prime Minister can be redeemed as well. Three months ago her Finance Minister pooh poohed the idea of an Anzac dollar. Now she is earnestly considering the idea.
"There are signs the Government may also keep its pre election promise on the tax treatment of R&D as well.
"By following the so called 'third way' of the governments in the UK and the US, ours may yet demonstrate it can learn what makes business and our economy work.
"A useful measure to assist we think would be to introduce a warehouse index. This would work by gauging when the exchange rate and our economic competitiveness tipped in favour of exporting at the expense of importers. An early peg on the index would be when the Warehouse started reviving its support for buying New Zealand made goods instead of relying on cheap imports.
"A second beacon would light up when our dollar sank further and the Importers Institute called for the Finance Minister's resignation. A third marker signalling our dollar was severely undervalued would be when the Institute donned sack cloth and ashes and foretold the end of the world.
"All these signals should gladden the hearts and wallets of local entrepreneurs seeking to get started in a local value adding business with export prospects."