NZ Economy: The NZ Economy - Emerging Conclusions
July 2nd, 2010
The NZ Institute is about to release a discussion paper on NZ’s economic strategy. The findings include:
• NZ has many opportunities to improve labour productivity, the main determinant of prosperity. Choosing policies which differ from those followed by more successful countries has contributed to economic underperformance. Other OECD countries have become wealthy by expanding exports of differentiated value-add goods and services but NZ has continued to rely on commodity exports.
• NZ’s small size and distance from major markets make marketing and sale of differentiated goods and services especially difficult. However, NZ has done less than other small countries to help emerging exporters to overcome the size and distance barrier.
• Economic improvement efforts should focus on transforming the NZ economy so it more closely resembles the successful advanced economies. This implies a focus on expanding exports of differentiated goods and services: ICT and niche manufacturing, as well as value-added primary goods and differentiated goods and services based on agricultural technology.
• Efforts to lift labour productivity should be focused on firms which export differentiated goods and services. It should start at the internationalisation stage of those firms’ development.
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