“We can’t shrink our way to greatness”- Seth Godin
A clutch of New Zealand economists, who speak truth to me, have called for our current government to immediately suspend their spending cuts.
Ganesh R. Ahirao has reposted a letter addressed to our policy makers. I, in turn, post a section of this letter in support of our goal of uncovering hidden talent in New Zealand.
“Fiscal policy is in direct conflict with the Government’s stated export target
A successful fiscal policy is one that has an economic justification consistent with a clear aspiration. Such aspiration would set the direction to an improvement in New Zealand’s external position, and so underpin its ability to confront the climatic, social, and demographic challenges, as well as increasing our ability to withstand global economic shocks.
The Government’s stated objective to double the value of exports over the next decade potentially provides direction. However, a focus on lifting export quality and unit values – making clear the target is not simply about increasing quantities – is required. Further, a goal directly targeting net exports (i.e. exports minus imports) would be more consistent with this aspiration, placing value on import competing activities as well as on export expansion.
Importantly though, there is a direct conflict between the current fiscal policy stance and the aspirational export goal. New Zealand’s historical reliance on volume-driven commodity growth and mainly low-value exports requires significant structural shifts for the returns from exports to be doubled. Without investment in key infrastructure, resilience building, business capacity and capability, human capital, and entrepreneurial endeavour, the necessary structural shifts will not occur. The current fiscal policy settings undermine the required investments to facilitate such shifts.
Consequently, your Government’s aspiration for the export sector will itself continue to be an aspiration due to a short-sighted fiscal policy stance, rather than the attainable goal it could become.”
For full article: Economists call for immediate suspension of spending cuts
As stated, this government’s call for increased exports fails to acknowledge the role of the innovation required to create high value, exportable products and services. A deeper examination of what is required for innovation to occur has not been a key part of our strategic thinking.
In terms of human capital, innovation requires a healthy disrespect for the status quo. It requires unleashing curious minds and giving them a place at the table. Furthermore, it requires of us that we first acknowledge and support the abundant skills we have hiding in plain sight.
Follow us as we build this capacity for the future of Aotearoa, New Zealand.
Comments