New Zealand’s national overdraft will hit negative $25 billion in just four years, showing National has failed in its promise to rebalance the economy, says Labour’s Finance spokesperson David Parker.
“National is running a two-speed economy. The export sector is stuck in low gear while property speculators are in overdrive. New figures from NZIER today show the current account deficit, or the national overdraft, will hit minus 10% by 2017. It is already the worst in the developed world, so National has already failed.
“Bill English promised to rebalance the economy. The test for a balanced economy is whether we are earning more from our exports than what we pay for our imports and interest. By 2017 our imports and interest will cost $25 billion more than what we earn in exports. That’s calamitous and New Zealand is getting poorer as a result.
“Under National we have to sell even more of our assets to foreign buyers or borrow yet more from overseas bankers.
“National has failed to deliver. The rampant housing market is coming at the expense of our struggling export sector. Bill English’s budget failed to provide the important changes needed for our economy.
“Labour will not shy away from those changes and has three major policies that will decrease our national overdraft.
“In Government we will boost our savings through universal KiwiSaver. That means we don’t have to borrow so much from overseas bankers and have a national investment pool to invest in our businesses.
“We will create a capital gains tax to limit speculation on property that drives up housing prices and overseas borrowing and gets investment into our exporting businesses so they can sell more overseas.
“Our reform of monetary policy will tackle our overvalued exchange rate and make our currency more competitive so exporters have a level-playing field.
“National has failed. Their vested interests don’t want the changes needed so they won’t move. Real change can only come through Labour,” says David Parker.
29 May 2013 MEDIA STATEMENT