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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Trade deficit a growing problem

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The latest New Zealand Manufacturers and Exporters Association (NZMEA) Survey of Business Conditions completed during August 2013, shows total sales in July 2013 decreased 2.62% (export sales decreased by 3.7% with domestic sales decreasing 1.74%) on July 2012.

The NZMEA survey sample this month covered NZ$551m in annualised sales, with an export content of 44%.

Net confidence fell to 9, down from the 13 result reported last month.

The current performance index (a combination of profitability and cash flow) is at 104.7, up from 98 in June, the change index (capacity utilisation, staff levels, orders and inventories) went down to 102 from 103 in the last survey, and the forecast index (investment, sales, profitability and staff) is at 104.33, up on June’s result of 102.67. Anything less than 100 indicates a contraction.

Constraints reported were 55% markets, 18% production capacity, 18% skilled staff and 9% capital.

Staff numbers for July decreased year on year by 0.48%.

“Sentiment and our composite indexes are generally positive; however sales and employment continue to contract year on year.” says NZMEA Chief Executive John Walley.

“We are relieved to see the Reserve Bank of New Zealand (RBNZ) finally move to introduce limits on high loan to value ratio mortgages, creating more space around interest rates.”

“Recent falls in the value of the New Zealand dollar (NZ$) are overdue, and RBNZ comment around interest rates in the future has taken some pressure off the currency. The NZ$ is still overvalued but any move towards a more sustainable level is welcomed by exporters; a measured realignment over time would be the preferred path for those significantly hedged.”

“The expected tapering of the Federal Reserve stimulus should help the US cross rate; but a long term policy response is needed to provide better currency stability into the future.”

“Market demand is a challenge and in particular the slowing of Australia and the weakening of the Australian dollar impacting margins.”

“Market softness is hitting everyone, competitors buying work in Europe and the USA and low prices on imports to New Zealand featured in the commentary this month.”

“This weeks Overseas Merchandise Data showed the value of imports increasing by $676m (17%), while goods exports fell by $196m (4.8%). This also showed a trade deficit of $774m (20% of exports) this is the critical deficit that policy needs to consider.”


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tags: survey, exports, trade deficit, manufacturing, rbnz


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