Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search


Debt and deficit highlights economic mismanagement

23 March 2005

Growing debt and deficit highlights economic mismanagement

The Green Party has accused the Government of sitting on its hands while New Zealand economy¡¦s deteriorates.

Statistics New Zealand announced today that New Zealand¡¦s current account deficit for the year to December had widened to $9.3 billion, or 6.4 percent of GDP, and net foreign debt had increased to $123.5 billon. The main factors behind the widening current account deficit were an increase in income payable to foreign investors, and an increase in the import of goods.

¡§Finance Minister Michael Cullen is like a king in his counting house gloating over the Government¡¦s fiscal surplus, while the rest of New Zealand is paying a high price for the Government¡¦s failure to actively manage the New Zealand economy,¡¨ said Green Co-Leader Rod Donald.

¡§When will the Government take heed of the messages in today¡¦s balance of payments figures? New Zealand simply can¡¦t afford to continue spending more than it¡¦s earning, and borrowing to pay the difference.

¡§Our deteriorating economic situation is exacerbated by the overvalued Kiwi dollar. It¡¦s why , along with the Government¡¦s free-trade policies, New Zealand now has a goods trade deficit of $2 billion on an FOB basis, when until two years ago we had always had a surplus.¡¨

The Greens are calling on Dr Cullen to:

-ƒnImplement the measures he says he has at his disposal to get the New Zealand dollar down to a reasonable level.

-ƒnScrap his plans to liberalise foreign investment laws and instead bring in tighter controls, both to limit speculation on property and to focus the inflow of foreign capital on new, productive investment.

-Re-orient the economy towards greater self-reliance. The Government¡¦s failed export-led growth strategy needs to be replaced by a determined ¡¥buy New Zealand made¡¦ campaign, led by the Government through its own purchasing policies.

-Introduce across-the-board tariffs on imports to reduce the current account deficit and to provide some relief from the high dollar for domestic manufacturers

-ƒnLook at introducing a capital gains tax on properties other than the family home. This would help to deflate the property boom but more importantly would give the Reserve Bank the flexibility to drop the official cash rate.

¡§Dr Cullen may not find any of these Green Party proposals palatable but I challenge him to come up with better ideas for reducing the pain being caused by the deteriorating current account deficit,¡¨ Mr Donald said.


© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell: On The Peters/Ardern Triumph

There are a lot of good reasons to feel joyful about this outcome. It is what so many young voters – the best hope for the country’s future – wanted.

Far more important than the implications for the Economy Gods ( is the dollar up or down? ) last night’s outcome will also mean many, many vulnerable New Zealanders will have a better life over the next three years at least.

Yet the desire for change was in the majority, across the country..>>>More


Labour on its agreement |Peters: Post-Election Announcement Speech | Greenpeace “cautiously hopeful” about new Government | ACT - Madman on the loose | E tū ecstatic | Chamber welcomes the outcome | Greens on their joining Govt | EDS welcomes new govt | Immigrant groups worry | Feds ready to engage new coalition government | Labour Ministers of the Crown announced


Climate: Increasing Greenhouse Emissions Hit NZ

New Zealand is seeing impacts of excess greenhouse gas emissions in our climate and oceans, according to the latest national report from the Ministry for the Environment and Stats NZ about the state of the atmosphere and climate…More>>


Wellington.Scoop: Arrests At Blockade Of "Weapons Expo"

“We encourage people in Wellington to get down to the Westpac Stadium now for a day of awesome peace action. There will be plenty of food, music and activities to keep us sustained through the day.” More>>


Rorschach Restructuring: PSA Taking Inland Revenue To Court Over Psychometrics

The Public Service Association will be seeing Inland Revenue in Employment Court over its intention to psychometrically test employees reapplying for their roles at the department as part of its controversial Business Transformation restructuring plan. More>>


Nuclear Disarmament: Nobel Peace Prize 2017 Awarded To ICAN

Congratulations from iCAN Aotearoa New Zealand to international iCAN, the other iCAN national campaigns and partner organisations, and the countless organisations and individuals who have worked so hard for a nuclear weapons-free world since 1945. More>>


Expenses: Waikato DHB CEO Resigns

An independent inquiry has identified that Dr Murray had spent more than the agreed $25K allocated for relocation costs, and other unauthorized expenses involving potential financial breaches of the chief executive’s obligations. More>>


Wellington.Scoop: Sad About The Trolley Buses?

The Regional Council’s MetLink is today spending money to tell us that it really loves Wellington’s trolley buses, even though they’re all being taken off our roads by the end of this month. More>>


Post-Election: Preliminary Coalition Talks Begin

New Zealand First will hold post-election preliminary discussions in Wellington with the National Party tomorrow morning and the Labour Party tomorrow afternoon. More>>




Featured InfoPages

Opening the Election