Ten years ago non-primary manufactured goods made up 37% of our goods exports. That proportion is now just 24%. Our export and therefore economic dependence upon the primary sector is soaring. This is very unlikely to change given the strong demand offshore for our primary products, global challenges which face all manufacturers no matter where they are, and the high probability of a continued high NZD which we show is correlated with manufacturing export weakness. Page 1 – 2
Bye Bye Australia, Ni Hao China
Right this minute, as you sit at your desk or lie in your bath reading this at the end of October 2013, China is overtaking Australia to become our most important export destination. The relationship will never go back and from here on out the NZ government and primary producers will need to give high thought to how China and the Chinese will perceive everything they/we do. Welcome to our new world and the answer perhaps to the question why the Government does not want to impose restrictions on foreigners buying NZ residential property. Page 3-5
In school kids receive frequent praise. In the workplace though? Not in New Zealand given our culture. Page 5
Inflation Risks Building
Inflation is currently low at just 1.4%. But economic growth is accelerating with capacity use and business difficulties in sourcing labour already at above average levels. Labour supply quality has deteriorated after five years of low investment in apprenticeships and training, and business investment has not only been weak since 2008 it remains weak with no obvious improvement yet underway. The reluctance of businesses to invest is a global phenomenon and calls into question the sustainability of economic upturns increasingly being propelled by a lengthening period of global extraordinarily easy monetary policy. Page 6
Which Age Group Likes The RB’s LVR Rules?
This Sunday morning before heading to Auckland then flying to Japan for the Japan NZ Business Council conference I will release the results of our latest BNZ-Nine Rewards Consumer Trends Survey. This month we added an extra question regarding whether people support or oppose the LVR rules. From the 524 respondents we found a net 15% opposing the rules. A net 55% of 25 – 29 year olds dislike them. But there is one group who support them – those aged 65 years and over with a net 22% favourable view.