NZ — the frightened nation
Where is the well thought-out strategy to drive NZ forward?
Ardern seems deliberately oblivious to toplevel business advice — including from her own Business Advisory Council — that New Zealand is slipping behind on the economic front versus Australia.
Locked in our “South Sea bubble” — pun intended — Jacinda Ardern proclaims “New Zealand is the envy of the world”. Yet week after week, more Kiwi businesses are being driven to the wall and there is no sign yet of a wellexecuted strategy to drive the country forward (short, that is, of us ending up becoming a land of beneficiaries by the sea).
New Zealanders are in danger of becoming a nation of people who are collectively too scared of the shadow of the Covid-19 virus even to all come back into the office after Cabinet makes its belated decision that it is time to move to alert level 1.
That’s what two months of daily urgings from the Beehive to “stay home, stay alive” do for you.
Kiwi webinars, Zoom musings, reimaginings of the future and “vision casting” — some of which will be publicly elevated in two high-profile events next week — have become a substitute for action.
This is not the case in some other countries.
Germany — which appears to have retained some of its respect for public finances — introduced a stabilisation package early in the piece. Its Economic Stabilisation Fund foresaw that larger companies may require financial assistance because of the ravages of the pandemic. With bigger companies the State reserved the right to take equity in return for support, while smaller companies were able to get direct grants.
The German fund was established on April 6, the same date as Finance Minister Grant Robertson established his $50 billion Covid-19 Response and Recovery Fund.
Ardern’s singular focus has been on eliminating the virus. She is rarely challenged in press conferences over the economic costs of what she labels her captain’s calls. Broadcasting hosts hold her feet to the fire. But Ardern seems deliberately oblivious to toplevel business advice — including from her own Business Advisory Council — that New Zealand is slipping behind on the economic front versus Australia.
Nor does she take any notice of her Deputy Prime Minister’s urgings to move to alert level 1 in line with advice to Cabinet.
This would not matter so much if she had a bunch of highly capable Cabinet ministers who were simultaneously leading a concerted push to transform the economy rather than giving all the signs that they are simply happy to ride back into office on the coat-tails of her outstanding political popularity.
Robertson is careful not to undermine her. He is fairly clear that he wants NZ back to level 1. As Finance Minister, he can see the impact of the loss of consumer confidence on retail sales and the observable fact that our cities no longer sport thriving CBDs but are becoming dead hearts.
Compared to Germany — which made its first financial stabilisation measures at roughly the same time as ours — New Zealand has effectively trodden water.
Chancellor Angela Merkel has mounted a well-executed policy putsch and put a massive fiscal stimulus behind projects that will transform Germany and equip it to deal with climate change.
About €130b ($227b) has been rolled out in the latest stimulus package, with €40b for climate related spending.
Among the Merkel Government measures are €6000 incentives for electric vehicle sales; a major investment in developing hydrogen infrastructure — something NZ has talked about but not invested up large in; and more development of public transport networks, energy efficiency upgrades and improved forest management.
This is to spur the shift to a greener economy.
Germany will also reduce its VAT (the equivalent of NZ’s GST) from 19 per cent to 16 per cent for six months as part of other stimulus measures.
British environmentalist Sir Jonathon Porritt has produced a study for the Aotearoa Circle’s Fenwick forum next Thursday. Porritt asserts that CO2 emissions reductions of 7-8 per cent per annum, every year, are required to ensure that the average global temperature rise does not exceed 1.5C by the end of the century.
“Early estimates show that this is roughly the decrease that we will see as a consequence of reduced economic activity in 2020 caused by the coronavirus crisis; in other words, the tap’s been turned down, but the bath is still filling.” The report: Building back better: Post Covid-19 recovery planning, asserts that at least US$5 trillion has already been committed by governments around the world to prevent their economies imploding.
The Fenwick Forum — named after the late Sir Rob Fenwick — has about 65 confirmed attendees including:
Fraser Whineray, COO, Fonterra; Vince Hawkesworth, CEO, Mercury; Jane Taylor, chairwoman, Orion; Vicky Robertson, CEO, MfE; Caralee McLiesh, CEO, Treasury; Todd Charteris, CEO, Rabobank; Antonia Watson, CEO, ANZ; Chris Quin, CEO, Foodstuffs; Peter Mersi, CEO, MoT; Steven Carden, CEO, Pamu¯ ; Ray Smith, CEO, MPI; Rod Carr, chair, CCC; Sir Peter Gluckman, director, Koi Tu; Sir Stephen Tindall; and Richard Gordon, CEO, Manaaki Whenua.
Their aim is to ensure Covid-19 recovery investment supports economic recovery and the ultimate protections and restoration of NZ’s natural environment.
Next week is also Vision Week. Infrastructure NZ, the Sustainable Business Council, InternetNZ and Infracom are behind the free web summit envisioning a post-Covid New Zealand.
Speakers include Peter Beck, Frances Valintine, Tamati Kruger, Sir Peter Gluckman, Kate Boylan, Shamubeel Eaqub, Dr Rod Carr, Rachel Taulelei, Sir Stephen Tindall, Nicole Rosie, Rod Drury and more.
Anyone can register for the summit at visionweek.co.nz. Participants are encouraged to post their ideas, videos, polls or other content using the #visionweekNZ hashtag on Linkedin, Facebook or Twitter, so these ideas can be shared through the platform.
Like others, I will be tuning in to both events.
But it is the results, over grandstanding, that count.