The OCR has become a rod with which Dr Bollard can beat exporters while he remains powerless to punish speculators and banks, says the Productive Economy Council (PEC) in reference to the pending RBNZ statement out this week.

“The reports today suggest the recession is over for the average New Zealander and that may well be true. The housing market has again started to take off and bank lending follows. Yet the green shoots of economic recovery are still so fragile that any decent frost will wipe them out. The tradable economy (Exporters) is hurting more now than at the beginning of the recession and Dr Bollard must surely know that. As a result his options are actually very limited”, says Selwyn Pellett, spokesman for the Productive Economy Council. read more »

PEC’s submission to the Parliamentary Banking Inquiry can be viewed here (PDF).

The presentation by the New Zealand Manufacturers and Exporters Association to the Banking Inquiry can be viewed here and its full submission here.

In commenting today that “there is some evidence at the moment that the recovery could consist of a pickup in housing,” Finance Minister Bill English went on to tell reporters that “now that’s more of the problem than we had before and it would be a concern particularly if it goes with a high exchange rate that punishes our exporters.”

Productive Economy Council spokesman Selwyn Pellett says that while the government is 100% on target in identifying the problem that real wealth creation for the country can only come from exports, the PEC remains unconvinced about its commitment to solving it. read more »

As the revelations continue, we realise that it’s not the voters of New Zealand that have been holding back on implementing Capital Gains Tax (CGT) but rather a very small yet influential group of New Zealanders well connected to the political machinery of office,” says Selwyn Pellett, spokesman for the Productive Economy Council.

“We had no idea of the number of politicians on both sides of the house that are compromised by their own investment choices,” says Pellett. read more »

“The furore over Minister’s second homes once again raises the question of the lack of Capital Gains Tax incentivising property speculation, distorting our investment regime and depriving our productive sector of the financial oxygen it needs to grow”, says John Blackham, of the Productive Economy Council.

“If the income from property speculation, be it by Ministers of the Crown or private citizens, were taxed in line with what Joe average Kiwi citizen contributes through his weekly wage packet, then New Zealand would stand a better chance of competing with the rest of the developed world.” read more »

The Productive Economy Council has welcomed the announcement of an inquiry into bank profits by Labour, the Greens and the Progressives, but cautions that unless its terms of reference are broad enough, it may not get to the root of the problems the country faces with regards to banking and monetary policy.

read more »

The PEC is delighted to see Federated Farmers requesting more transparency with bank costs, joining the diverse group of organisations calling for a re-evaluation of the makeup of bank operating profits in the current climate.

read more »

The proposed four day working week is a prudent step but not enough for an export led economic recovery according to the head of the Productive Economy Council, Selwyn Pellett.

“A four day week may ease the tax burden of supporting an increasingly high number of unemployed but it won’t change our declining position within the OECD or help our exports become more competitive.  We need more bold initiatives to get our best and brightest motivated to be more productive and create long term jobs in the process,” he says. “An export led recovery is New Zealand’s best chance for an early turn around and reducing the number of working days on its own is not going to get us there. Trade barriers will soon be the norm around the world and if our exports don’t represent demonstrable value to end users then our products won’t be on foreign shelves and an export lead recovery won’t be realised.

read more »

Dr Bollard might as well put up a white flag and surrender to the Banks, says Selwyn Pellett, spokesman for the Productive Economy Council.

Pellett says yesterday’s announcement by the Reserve Bank that it was not going to lower interest rates further was a sign of capitulation demonstrating Bollard’s inability to influence banks over short term interest rates. Bollard’s failure to lower the rate further highlights that the Reserve Bank and the New Zealand Government have no effective Monetary Policy, he suggests. read more »

Dr Ganesh Nana, chief economist at Business and Economic Research Limited, is right on the money with today’s comment’s that we need the Reserve Bank to step in to provide low cost business loans – in effect, printing money says Productive Economy Council (PEC) spokesman Selwyn Pellett.

“It’s our sovereign right to do so and right now it makes perfect sense to all but the foreign banks,” he says. read more »