Our low growth is not due to external factors


When the Government acknowledges the slowing of New Zealand GDP growth, it is to global risk it prefers to point.
In fact in her pre-Budget speech to Business NZ, Prime Minister Jacinda Ardern was happy to throw European uncertainty and the UK’s Brexit turmoil into the mix.
That’s politics I guess.
But in fact, New Zealand currently appears to be a net beneficiary of global economic events.
Export prices for New Zealand commodities have remained very strong.
In March, New Zealand exports rose $899 million (19 per cent) to reach $5.7 billion – a new record for any month ever.
In the year to April 2019, annual goods exports to China increased $2.7 billion (22 per cent) from the April 2018 year to reach $15 billion for the first time ever.

So blaming Europe for our low growth is silly.

So why not acknowledge why it is really happening?
The housing market is headed into a cyclical slump.
Business is not happy and not investing.
This has all the makings of a classic kiwi economic cycle.

And if investment stays low, the Government’s surplus may become a deficit.

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