Top Scoops

Book Reviews | Gordon Campbell | Scoop News | Wellington Scoop | Community Scoop | Search


Coronavirus: Is NZ Ready For A Worst-case Economic Scenario?

Click a link to play audio (or right-click to download) in
MP3 format.

Hundreds of North Island forestry workers could be relocated to conservation jobs in Southland to soften the economic impact of the Covid-19 outbreak.

A Treasury advisory group is predicting a significant drop in growth for the first six months of this year before things rebound, but is also working on two less likely, but worse, scenarios including the possibility of a global recession.

The tourism and forestry industries are already taking a hit. Air New Zealand is warning ahead of its half-year result that its earnings could be down by up to $75 million, and up to a third of the country's logging crews have been stood down because of supply chain problems in China.

"In the immediate term we have also asked officials to look at whether or not there are options to relocate some of the workers in the forestry industry who have been affected most immediately by this – whether they can be relocated to work on, for example, supporting [Department of Conservation] with track clearances in the South Island where we've had other weather-related issues," Finance Minister Grant Robertson told Checkpoint.

"Obviously that's a significant thing to consider. There are lots of issues and it won't be appropriate for every person, but that's why we've asked officials to go away and develop what a plan for that would look like if we see these effects in the forestry sector being sustained."

The government has already pledged $11 million in assistance for tourism, but Roberston said it is an industry set to lose hundreds of millions, and there will be impacts on education as well.

It is too early say exactly how much will be lost, but the tourism industry is looking at a potential loss of "hundreds of millions of dollars," he said.

"One of the specific things we need to work on is the kind of programme [the tourism industry] will have to rebuild the Chinese market. Clearly if and when we get to the point the travel restrictions are loosened from China we would want to be there to encourage people to return to New Zealand."

If the Covid-19 outbreak turned into a worst-case scenario – global recession – Robertson said the tax system would be looked at.

"But I've got to reiterate it's not something we're predicting.

"If you look at history in New Zealand, when we had the Global Financial Crisis under the previous National government debt I think reached at one point close to 30 percent, so there is the ability for us to look at different levels if we need to.

"We're some distance away from contemplating levels of that nature though.

"While overall we'll see some decline in economic activity in 2020, it won't be long-lasting."

Robertson also said the government is working on possible exemptions on travel restrictions for foreign students, but universities will need to come up with quarantine plans.

Universities have not asked for financial compensation, and the first priority for that kind of relief will be tourism, he said.

© Scoop Media

Top Scoops Headlines


Employers: On Wage Cuts, And The Listener’s Demise

Various levels of across the board wage cuts – 10%? 15% ?- are being mooted for workers in some of our larger firms, in order to help the likes of Fletchers, Mediaworks etc survive the Covid-19 crisis. It is extraordinary that unions should be having ... More>>

Gordon Campbell: On The Use Of Existing Drugs To Reduce The Effects Of Coronavirus

So now, we’re all getting up to speed with the travel bans, the rigorous handwashing and drying, the social distancing, and the avoidance of public transport wherever possible. Right. At a wider level…so far, the public health system has ... More>>

Gordon Campbell: On Oil Market And Regulation Crusades

Safe to say, Vladimir Putin did not expect the response he has received amidships from the Crown Prince of Saudi Arabia. Earlier, Russia chose to walk away from the OPEC talks in Vienna that were aimed at reaching an agreement on how to reduce world oil production (and protect oil prices) in the light of the fall in demand being caused by the coronavirus. No doubt, Russia and its allies in the US shale industry probably glimpsed an opportunity to undercut OPEC and seize some of its customers. Bad move. In reply, Saudi Arabia has smashed the oil market by hugely ramping up production, signing up customers and drastically cutting the oil price in a fashion designed to knock Russia and other oil suppliers right out of contention. More>>

Binoy Kampmark: Strong Man Legacies: Burying Mubarak

Reviled strongmen of one era are often the celebrated ones of others. Citizens otherwise tormented find that replacements are poor, in some cases even crueller, than the original artefact. Such strongmen also serve as ideal alibis for rehabilitation ... More>>

Caitlin Johnstone: Humanity Is Making A Very Important Choice When It Comes To Assange

The propagandists have all gone dead silent on the WikiLeaks founder they previously were smearing with relentless viciousness, because they no longer have an argument. The facts are all in, and yes, it turns out the US government is certainly and undeniably working to exploit legal loopholes to imprison a journalist for exposing its war crimes. That is happening, and there is no justifying it... More>>

Gail Duncan: Reframing Welfare Report

Michael Joseph Savage, the architect of the 1938 Social Security Act, wouldn’t recognise today’s Social Security Act as having anything to do with the kind, cooperative, caring society he envisioned 80 years ago. Instead society in 2020 has been reduced ... More>>

Gordon Campbell: On 22 Short Takes About Super Tuesday

With obvious apologies to the Simpsons….Here’s my 22 short takes on the 14 Super Tuesday primaries that combined yesterday to produce a common narrative –Bernie Sanders NOT running away with the nomination, Joe Biden coming back from the dead, and the really, really rich guy proving to be really, really bad at politics... More>>


  • PublicAddress
  • Pundit
  • Kiwiblog