Wednesday, September 13, 2006

Things aren’t always what they seem

Just because the economy is doing well doesn’t necessarily mean the country is doing well. This was highlighted by outgoing Fletcher Building chief executive Ralph Waters.

Politicians tend to spin economic data to their own means, so it’s hard to get the full picture. But when a high power executive uses his farewell lunch to warn about the economy with no apparently gain to him, I took note:

The record $14.54 billion current account deficit should have shocked people out of their complacency, but that had not happened. "Strong economic activity that is consumption-driven is also a bit misleading as to how we are really traveling. The current account deficit is a reminder but, in the main, the country seems oblivious to the large structural imbalances," he said.

"Yet as a country we do all we can to discourage major manufacturing investment here, with the lack of certainty of power, its uncompetitive pricing relative to external options and the success vested interests have in making meaningful new investments very difficult, if not near impossible.

"These are false luxuries that the country cannot afford."

Makes ominous reading. I think the lack of certainty of power is a critical issue. How many more rivers are going to be damned and how much more coal is going to be burnt – both environmentally unfriendly, before NZ bites the bullet and goes nuclear? I’m not necessarily pro nuclear, but what I object to is putting the NZ future at risk for the sake of anti-nuclear political rhetoric.

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