John Key MP
National Party Finance Spokesman
20 January 2006

Japan trip risks tarnishing NZ’s reputation offshore

Government officials’ attempts to badmouth the New Zealand economy in Japan are not only futile but risk tarnishing the country as an investment destination, says National finance spokesman John Key.

“Finance Minister Michael Cullen should say what information was shared on this Government-sanctioned trip that he was not prepared to share domestically.

“Is Dr Cullen telling us he sees it as officials’ jobs to warn overseas investors off from investing in New Zealand? “If so, what message is this sending to the global investment community?

“Telling Japanese retail investors New Zealand has a massive current account deficit is surely not news to them, so what else did officials tell the investors?

“Dr Cullen knows full well that the appetite for uridashi issues and other hot money that is flowing into New Zealand is because we have the highest interest rates in the developed world.

“In part this is because of the inflation pressures created by his Government’s buildup in its own spending.”

Mr Key says the officials’ visit was inconsistent with Dr Cullen’s previous comments. Last month in answer to a question from Mr Key in Parliament, the Finance Minister described uridashis as a ‘long term investment’.

“Now, suddenly, they are essentially junk bonds and offshore investors should keep well away from them.”

Mr Key says Dr Cullen is increasingly looking like the desperate Finance Minister that he is when his departments’ domestic work programme is to look at ways to intervene in the housing market and the offshore work programme is to discourage overseas investment.

“Maybe Dr Cullen should wake up and realise his Government and its profligate ways are the problem, not the solution.”

ENDS

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