The dollar’s post-float high on the trade weighted index shows it is critical that concrete action is taken to make our overvalued exchange rate more competitive, says Labour’s Finance spokesperson David Parker.
“The dollar has been too high for too long and it’s been crippling Kiwi exporters. Now it’s at the highest level on the trade weighted index since it’s was floated. This is breaking the back of manufacturing exporters outside the primary sector.
“Throughout the hearings of the Parliamentary Inquiry into Manufacturing, business owners have told us that they will have to shut their doors or lay off workers if the dollar stays this high.
“International practice has changed. Our competitors are addressing their exchange rates. National still says there’s nothing they can do. That’s an insult to exporters.
“Our Reserve Bank has an obsolete tunnel-vision mandate to give primacy to inflation over other important factors such as the exchange rate and employment. We need to change the Act to give the Bank a 20/20 perspective on the economy so our exchange rate can be more competitive.
“Bill English glibly says that exporters who call for a lower dollar are hurting their workers by reducing their real wages. Tell that to the 17,000 manufacturing workers who lost their job last year, Finance Minister.
“The truth is manufacturing workers are right behind change in their sector. There’s a new consensus from workers and their bosses to revive manufacturing. The Government just doesn’t get it.”
15 February 2013 Media Statement