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


Dealing with the Balance of Payments crisis

Living beyond our means, dealing with the Balance of Payments crisis

Jim Anderton MP Wed Sep 8 1999

Jim Anderton
MPThe balance of payments deficit has reached a crisis point. At $6,374 million in the last year, every New Zealander is spending $33 dollars a week more on imported goods, than we earn from the sale of our nation's exports, said Alliance leader Jim Anderton today.

The Alliance proposes bold initiatives to deal with the crisis

'New Zealand cannot sustain this sort of debt for much longer. Under WTO rules and regulations we have the right to deal with this sort of ballooning debt. Indeed we must deal with it,' said Jim Anderton.

GATT and WTO rules make it clear that tariffs can be imposed for balance of payments purposes and in fact they are preferred rather than reducing the quantity of imported goods.

The balance of payments is the difference between the amount New Zealand earned overseas last year and the amount it spent. This is the 27th consecutive year New Zealand has run a balance of payments deficit - a world record for a developed nation.

The Alliance proposes a temporary 5% increase on tariffs on imports excluding Australian goods as a way of decreasing our reliance on imports until our balance of payments problem is under control.

'Only about 17% of our GDP consists of goods that would attract this tariff.

'This means that in $100 worth of supermarket goods, only $17 of that would be increased by 5%. This is equivalent to an 85c price increase, or about the cost of an American Hershey's chocolate bar.

'The government's rapid removal of tariffs has only served to take more money out of New Zealanders pockets to pay for increased overseas debt. The removal of car tariffs, for example has directly contributed to the balance of payments crisis.

After two full years running a current account deficit in excess of 6% of GDP, Jim Anderton says the climate for the use of tariff policy is changing.

'No one can seriously believe that overseas deficits of this size are sustainable. The deficit is so large and so intractable that it restrains economic growth. The economy can't pick up quickly without sucking in imports, which in turn worsens the deficit and slows growth.

'The rest of the world will very soon wake up to New Zealand's real and weak economic position.

'We now owe $102 billion in overseas debt, $27,700 per New Zealander. We are paying for this overspending and overseas debt in lower wages, higher interest rates and lower company profits.

'We estimate that New Zealand demand stimulated from this modest tariff would create at least 26,000 jobs over the next five years as well as increasing government revenue that can be spent on health and education initiatives,' Jim Anderton said.

© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell: on the inquiry into the abuse of children in care

Apparently, PM Jacinda Ardern has chosen to exclude faith-based institutions from the government’s promised inquiry into the abuse of children in state care.

Any role for religious institutions – eg the Catholic Church – would be only to observe and to learn from any revelations that arise from the inquiry’s self-limiting focus on state-run institutions… More


Gordon Campbell: On Jim Anderton
For anyone born after 1975, it is hard to grasp just how important a figure Jim Anderton was, for an entire generation.
During the mid to late 1980s, Anderton was the only significant public figure of resistance to the Labour government’s headlong embrace of Thatcherism...More>>


Gong Time: New Year's Honours List

Jacinda Ardern today congratulated the 179 New Zealanders named on the 2018 New Year’s Honours List.

“Although this list was compiled and completed by the last government, it is a pleasure to welcome in the New Year by recognising exceptional New Zealanders,” Jacinda Ardern said.

“As an Aunty, I love reading books to my nieces, so it’s lovely to congratulate Joy Cowley, who is made a member of the Order of New Zealand today....More
Full list

Roads: National launches bid to save highway projects

The National Party has launched a series of petitions aimed at saving regional highway projects at risk because of the Government’s obsession with Auckland trams…More>>


Medical Cannabis: Bill Introduced to “ease suffering”

Health Minister Dr David Clark says making medicinal cannabis more readily available will help relieve the suffering of people who are dying in pain More>>


Campbell: On The Quest For Zero Net Carbon Emissions
Some would querulously ask, zero net carbon emissions by 2050 – while others would say, why not?


CPAG Report: The Further Fraying Of The Welfare Safety Net

New Zealand’s welfare system has undergone a major transformation during the past three decades. This process has seriously thwarted the original intent of the system, which was to provide a decent standard of living for all New Zealanders in times of need... More>>





Featured InfoPages