A better export mix rather than being ‘decoupled’
NZMEA Media Release, Friday 22 February 2008.
A better export mix rather than being ‘decoupled’.
The New Zealand Manufacturers and Exporters Association, (NZMEA), says that New Zealand cannot become ‘fully decoupled’ from the impact of American and European credit woes and high exchange rates, and that strong demands for commodities from India and China will not support export-led economic growth over the long term.
“The strong commodity prices are being used to deflect concern over the impact that strong exchanges rates are having on exporters, especially those in the elaborate sector”, says Chief Executive John Walley.
“Rather than address a strategic, risk-reduced target for the country’s export mix that provides support to all sectors of the economy, current policy and thinking is not looking beyond the aggregate terms of trade. At the moment, commodity prices are strong, the primary sector is strong, so therefore our economic outlook is strong, but the simplification of our export mix and an over-reliance on commodity-based exports will leave New Zealand’s future export profile less resilient and exposed to shocks, weather, prices and exchange rates”.
Mr. Walley says that the clear trajectory towards simplified export product mix needs to be reversed with policy that encourages and enables operations in New Zealand to be successful, no matter what sector they are in.
“Winning behaviour within New Zealand business has been identified, yet our companies need stability and support from policy settings that do not hamper the development of the elaborate sector. This is the key to diversifying export mix and improving security of income going forward, especially when developing economies start to catch up to New Zealand in terms of their own commodity exports, and/or if our primary sector suffers any reversals or it in access, demand and margins”.
“The strong NZD is diminishing the receipts that our exporters receive and the simplification of our export mix over time, more of the same policy will deliver more of the same outcomes. Rather than revert to the “economy is good in parts” argument for doing nothing and hope New Zealand can withstand any external shocks; we should be addressing what it is that can be done here to provide even handed support for all the economy and build an export profile that can bring sustainable and robust growth into the future”.
NZMEA – the authentic and independent voice for manufacturers and exporters.
For further comment contact John Walley, 03 353 2545, 021 809 631.
Miller, NZMEA Media Liaison.
Phone: 03 353 2544, 021 605 771
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The New Zealand Manufacturers and Exporters Association (NZMEA) is a national organisation that was founded by the Canterbury Manufacturers Association (CMA) and the New Zealand Engineers Federation (NZEF). The Association is New Zealand's only sector focused and independent voice of manufacturers and exporters. Association members make nearly $2.0 billion in sales and have an export value of around $1.0 billion. Our organisation can trace its beginning to the early history of New Zealand.
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