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David Thompson Posted:
So very, very true. It beggars belief that we consider ourselves to be a developed nation when so much of our economy is based on selling milk powder or logs. BTW, I own a Plinius amplifier (my second) that drives a set of Theophany speakers.
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David Thompson Posted:
A robust but sobering report. It concerns me that confidence is rising, yet sales and exports are down and "manufacturers and exporters are still lagging behind other sectors". Surely we should wait until we're earning more money before we start spending more?
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siemens Posted:
Yes true! The only thing that will never die in this world is the nature and its science behind it. Great post.
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Kieran Ormandy Posted:
Thanks for the question Steven, Germany has seen increases in manufacturing employment since 2009, and Switzerland has had stable manufacturing employment between 2006 – 2011, even in the face of ongoing Euro-zone issues. Korea has seen increases in manufacturing employment since 2008 and Israel experienced large increases since 1998, while being stable over the last 4 years. Singapore has had increases in manufacturing employment over the last two years. These countries all value their manufacturing sectors and work to protect them, this is reflected in the above numbers and their performance through the GFC. Note data around the above examples was sourced from OECD labour market stats.
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John Walley Posted:
Point one: you should have no doubt what our Association says publically represent the views of our members. Point two: we don’t knee jerk responses, if you trace back our comments around NZPower you will see them link all the way back to our research in 2004 and 2005. All that material is fully linked from our comments above. Point three: you will note our comments on major users, sadly the same advantage does not accrue to smaller industrial users. The perverse incentives of the LRMC approach in all this are well known. Point four: the NZMEA is not like any other Association in New Zealand we admit only manufacturers and exporters into membership, and our public expressions are the views of that restricted membership.
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21/8/12

Basic changes needed for productive growth


Print-friendly 0 comment(s) Posted in: In the media

The New Zealand Manufacturers and Exporters Association (NZMEA) welcome the target of doubling private research and development levels but warn that tinkering around the edges will not help it happen. The Government announced the target this morning as part of its Business Growth Agenda.

NZMEA Chief Executive John Walley says, “While our fiscal and monetary policy settings incentivise unproductive investment in assets over investment in productive activity such as research and development, not much is going to change. These policy settings have been locked into our economy for more than twenty years. This desperately needs to change.”

“The research and development tax credit was introduced in 2007 and scrapped in 2008 which dealt a blow to added value exporters and we need to see that, or something similar, restored. It is good to see some investment in the Advanced Technology Institutes, but it is worth noting that better balance and incentives to invest are most efficiently delivered through the tax system.”

“There is also a wider issue around the allocation of capital in New Zealand. Debt on property is continuing to outstrip investment in the productive sector.”

The Economist has released its house-price indicators showing that New Zealand has bucked the global trend of declining house prices by retooling our housing bubble. A lack of capital gains or land tax is at the heart of this problem. House prices 66 percent overvalued compared to rents demonstrate that it is only tax free capital gains that keep property investors in the market.”

“A culture change is needed – no country has ever got richer by renting each other houses or borrowing offshore to inflate property bubbles. The Government needs to support its target with changes to fiscal and monetary policy so that we see a genuine shift away from land and buildings towards an economy based on high value exports.”
 



tags: r&d, capital gains, productive investment

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