6 May 2004

Compliance costs stifle forestry growth

Major investors are looking elsewhere as the Government's compliance costs suffocate the forestry industry, says National's Forestry spokesman, Brian Connell.

He is commenting on a warning from the chairman of Carter Holt Harvey, John Maasland, that rising energy costs and red tape could topple plans to invest hundreds of millions of dollars in New Zealand.

"Both the ERA and the RMA make doing business unnecessarily difficult, and our core industries are starting to feel the bite," says Mr Connell.

"This, coupled with an increasingly uncertain energy supply and the strong kiwi dollar has proven to be a major headache for the forestry sector, New Zealand's 4th largest export earner, which brings in $3.42 billion a year.

Mr Maasland is seeking assurances that proposed changes to employment legislation will not harm Carter Holt Harvey.

"The Government should stop bowing to its union mates and start working to encourage this kind of investment instead of hampering it.

"We cannot afford to continue down a path that will see a sector as vital to our economy as forestry go down the drain," says Mr Connell.

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