10 June 1999

Trade figures show Govt in cloud cuckoo land

"The latest merchandise trade figures show conclusively that the National Government is living in a fool's paradise," says Labour finance spokesperson Michael Cullen.

"The trade balance result for April is much worse than was predicted by the markets and much worse than the average for April during the 1990s.

"What we are continuing to see is relatively weak growth in exports overshadowed by substantial growth in imports. The provisional merchandise trade balance for the year shows a deficit of nearly $1.3 billion when New Zealand ought to be in surplus.

"National continues to govern in the hope that a borrow and spend domestic consumption-led recovery will somehow reduce the cataclysm that is going to overwhelm them at this year's general election.

"Increasingly New Zealanders are beginning to recognise just how foolish this approach is. But National shows no signs of having learned the lessons of the failure of its economic management.

"The recent budget did nothing to improve the levels of New Zealand's exports or to moderate the growth of New Zealand's imports. Instead National turned a blind eye to the serious current account deficit and the worsening merchandise trade balance and hoped the public will follow suit.

"Labour's task as the incoming government will be to lead export growth on a sustainable basis and in such a way that our current account position improves significantly over time. If we do not do this, an increasing proportion of New Zealand will be owned overseas as we sell what we have left to cover our current account deficit," Dr Cullen said.

ENDS

© Scoop Media