Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


John Key - Living in a fool's paradise?

Living in a fool's paradise?

John Key recently claimed that the high dollar is a good thing, saying “For a lot of New Zealand consumers, their life’s actually a lot better because of the strong dollar.” This claim looks at only one part of the complex story of exchange rates which is harming our manufacturers and exporters, says the New Zealand Manufacturers and Exporters Association (NZMEA).

NZMEA Chief Executive John Walley says, “Recent research shows that import prices have relatively little impact on overall consumer prices. In any event, to consume much at all, you need a job, which will become more scarce as exporters close or move under the current pressure.”

“Although the high dollar does make imports cheaper, it is seriously hurting manufacturers and exporters, margins and competitiveness. This puts jobs at risk, and reduces the likelihood of reinvestment to improve productivity and employment.”

“Manufacturing is a relatively high wage sector, with higher median weekly incomes than the average for our economy. Wage rates tend to reflect labour productivity, margins and investment. Supporting investment in the manufacturing sector is the only way to sustain and improve real wages and living standards.”

“We cannot expect labour productivity to improve if policy settings starve margins and investment, slowing innovation and skill accumulation of our work force.”

“Our economy needs to operate in such a way that we can expect to build a strong export sector that will provide jobs and wealth in the long term, as a opposed to the short term overvalued exchange rate fools paradise.”

“Although a lower dollar may cause the price of imports to rise, there would be little identifiable impact overall on consumer price, as most New Zealand dollars spent relate to things that have costs in New Zealand dollars. We all visit the supermarket more often than the TV shop."

“Research conducted by the Reserve Bank of Australia showed that a 10 per cent appreciation in the exchange rate translated to only a 1 per cent decrease in consumer prices over around three years.”

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Must Sell 20 Petrol Stations: Z Cleared To Buy Caltex Assets

Z Energy is allowed to buy the Caltex and Challenge! petrol station chains but must sell 19 of its retail sites and one truck-stop, the Commerce Commission has ruled in a split decision that acknowledges possible retail price coordination between fuel retailers occurs in some regions. More>>

ALSO:

Huntly: Genesis Extends Life Of Coal-Fuelled Power Station To 2022

Genesis Energy will keep its two coal and gas-fired units at Huntly Power Station operating until 2022, having previously said they'd be closed by 2018, after wringing a high price from other electricity generators who wanted to keep them as back-up. More>>

ALSO:

Dammed If You Do: Ruataniwha Irrigation Scheme Hits Farmer Uptake Targets

Enough Hawke's Bay farmers have signed up for water from the proposed Ruataniwha Water Storage Scheme for it to go ahead as long as a cornerstone institutional capital investor can be found to back it, its regional council promoter announced. More>>

ALSO:

Reserve Bank: OCR Stays At 2.25%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2.25 percent, in a decision traders had said could go either way, while predicting inflation will pick up as the slump in oil prices washes out of the data and capacity pressures start to build in the economy. More>>

ALSO:

Export Values Down: NZ Posts Biggest Annual Trade Deficit In 7 Years

New Zealand has recorded its biggest annual trade deficit since April 2009, reflecting weaker prices of agricultural commodities such as dairy products, beef and lamb, and increased imports of vehicles and machinery. More>>

ALSO:

Currency Events: NZ's New $5 Note Wins International Banknote Award

New Zealand’s new Brighter Money $5 note has been named Banknote of the Year in a prestigious international competition. The $5 note was awarded the IBNS Banknote of the Year title at the International Bank Note Society’s annual meeting. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news