I have a very good understanding of the problems facing New Zealand. I have no idea how to fix them.
“The tradeable sector is made up of those firms that are in competition with the rest of the world – that is, they either export to other countries or they compete with imports here in New Zealand. This sector includes agriculture, fisheries, manufacturing, tourism, and forestry – the industries that make us money in the world.”
Sectors that unfortunately have largely focussed on doing the basics at lowest cost with minimal advanced capital investment. Sectors whose low-hanging productivity gains are already taken and will really have to make stepchanges to become super-productive. Sectors that won’t change a thing they’re doing from any of the “initiatives” announced in the speech.
Comment by Gareth W — July 15, 2009 @ 3:33 pm
Perhaps because they have no capital to invest in their business, capital that would normally be sourced from domestic savings, not just borrowing from overseas.
(And don’t let NZ farmers hear you imply that all those european farmers with their fancy tax-payer subsidised tractors and tax-exempt diesel on their tiny farms are more efficient than they are.)
Comment by Clunking Fist — July 15, 2009 @ 7:03 pm
“Perhaps because they have no capital to invest in their business”
Certainly part of it – which would suggest a focus on deepening and strengthening our local capital markets would help. Lord knows 9% compulsory “Kiwisaver” with attractive tax rates is precisely what gave the Aussies access to the capital they used to raid us.
But that’s not in the speech is it? Apparently they aren’t the party of compulsion. And Kiwisaver wasn’t as important as upper-rate tax cuts
Comment by Gareth W — July 16, 2009 @ 11:05 am
Gareth, he’s missed most of the growing parts of the tradeables sector: education, film, mining, horticulture and internet based services.
Comment by vibenna — July 15, 2009 @ 6:33 pm
Is the horticulture sector growing? Unless it’s intended as a pun, I thought the horticulture sector was actually shrinking.
Comment by kahikatea — July 15, 2009 @ 9:23 pm
I count wine as horticulture.
Comment by vibenna — July 15, 2009 @ 11:05 pm
i’m guessing he pressed horticulture and agriculture together.
you know, really milking the fruits.
Comment by Che Tibby — July 16, 2009 @ 9:01 am
Danyl that’s a good summary…except you couldn’t have read/chose to ignore the bit where he acknowledged that it’s the private sector that creates wealth, and then he stated that his Government is working on six main policy drivers to get out of the private sector or lend assistance where it was required, before going on to flesh those out a bit:
* regulatory reform
* investment in infrastructure
* better public services
* education and skills
* innovation and business assistance
* a world-class tax system.
Comment by Clunking Fist — July 15, 2009 @ 7:11 pm
Great, so what’s he doing?
Comment by Chris S — July 15, 2009 @ 7:46 pm
Or should the question be: what are BUSINESSES doing to improve their productivity, their profits (and therefore to enhance their taxpaying capacity)? It seems even the business folk now want teh gummint to short their lives out.
Comment by Clunking Fist — July 16, 2009 @ 1:15 pm
He does flesh them out a fair bit, doesn’t he…whadya know.
Comment by StephenR — July 15, 2009 @ 7:56 pm
Do an Obama and call in Goldman Sachs. Intelligent design economics what can go wrong?
Comment by Simon — July 16, 2009 @ 9:48 am
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