Scoop has an Ethical Paywall
New Zealand is in a dangerous debt spiral
New Zealand is in a dangerous debt spiral
By Oliver Marc Hartwich
10 March 2011
The
earthquake that struck Christchurch two weeks ago was not
only a
national catastrophe for New Zealand. It is also
becoming clear how
devastating it is to the Kiwi economy.
The New Zealand Treasury estimates an impact of 1.5 per cent
of GDP, or $NZ15 billion, for thisyear.
Prime Minister John Key went further and warned that the country's economy could stand still in 2011 instead of growing 2.5 per cent, as initially forecast. The consequences for public finances will be substantial in any case.
Unfortunately, dealing with the tragedy of the earthquake is not New Zealand's only problem. Natural disaster has hit a country that could ill afford it. Even before the darkest hour in New Zealand's history, its economy did not look healthy. The similarities between the Kiwis and troubled European countries are too disturbing to overlook.
The financial crisis has made us remember some half-forgotten truths. One of them is that countries with negative net foreign assets and large government liabilities are in danger of being shut out of capital markets.
Click here to read article. This article was published by the The Business Spectator
Articles in the Perspectives series plus
a large library of books, studies, speeches, articles and
DVDs on a wide range of public policy issues can be found at
www.nzbr.org.nz Related
studies and commentary: Some Policy Implications of the
Canterbury Earthquake An article published by the New
Zealand Business Roundtable 11 March 2011 By Roger
Kerr [Full text] The Economic State of the Nation, 2011 An address to
the New Zealand Business Roundtable Strategy Retreat 17-18
February 2011 By Dr Roderick Deane [Full text] Opportunities and Challenges in the Year
Ahead An article first published in The Otago Daily
Times 28 January 2011 By Roger Kerr The New Zealand Economy:
Challenges and Opportunities An address to the Dunes
Symposium 9-10 September 2010 By Dr Roderick
Deane [Full text] How Do We Compare?
New Zealand Public Policy Directions in an International
Context A publication by the New Zealand Business
Roundtable April 2001 By Phil Barry [Full text] ends
Gordon Campbell: On Why We Can’t Survive Two More Years Of This
NZTA: Forecast Strong Winds For Auckland Harbour Bridge Traffic
Queenstown Lakes District Council: Top 10 Most Hazardous Items Found In QLDC’s Waste Facilities And Rubbish And Recycling Bins In 2024
NZ Government: Drive Safely This Summer
Northland Inc: Game-Changing Investment For Northland - Resilience Fund Allocates $250,000 To Health Simulation & Training Centre
Interchurch Bioethics Council: Church Bioethics Agencies Express Dismay at the Rushed Consultation Period for Submissions on the Gene Technology Bill
New Zealand Police: More Than $2.5m Worth Of Assets Restrained In Undeclared Tobacco Case
