09 December 2005

Spare A Thought For The Farmers

New Zealand First says that the latest interest rate rise will hurt the very people we need to sustain our economy.

“Primary production remains the backbone of our economy, and any rise in the interest rate is going to impact heavily on this sector,” said primary production spokesperson Doug Woolerton.

“High interest rates combined with a high dollar spell disaster for exporters, which is further exacerbated by falling commodity prices.

“While the Reserve Bank governor is trying desperately to curb inflation fuelled by rising house prices, the rural sector will bear the brunt of the pain. This is not the kind of weight they should be expected to carry.

“Tinkering with interest rates to control one area of the economy invariably has unintended consequences in other areas, which farmers and other rural industries are finding out to their detriment.

“There is recognition by the real estate industry that this latest rise will hurt small businesses, farmers and exporters more than homeowners.

“We need to promote a balanced and flexible monetary policy of lower exchange and interest rates conducive to real export and employment growth for our primary sector,” said Mr Woolerton.

ENDS

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