Dire economic warning for New Zealanders

The International Monetary Fund’s dire economic forecasts paint a grim picture of the New Zealand economy under Labour, National’s Finance spokesperson Paul Goldsmith says.

IMF forecasts released this week show New Zealand’s economy is expected to fare much worse than most advanced economies over the next few years with GDP per person remaining materially lower in 2025 than it was in 2019.

“This places New Zealand right near the bottom of advanced economies,” Mr Goldsmith says. “It means our country will be poorer in 2025 than we were in 2019.”

Of the 39 advanced economies measured by the IMF, New Zealand’s GDP per capita growth between 2019 and 2025 is the fourth-lowest. We are forecast to perform worse than the likes of Australia, the United Kingdom, the United States, Japan and Canada.

“These forecasts are of grave concern. We are going backwards with no sign of recovery,” Mr Goldsmith says.

“The IMF forecasts are based on the current economic management of Labour and reflect very poorly on their policies to rebound from Covid-19.

“This is a grim forecast of a slow, grinding economic recovery under Labour, which has no plan to get our books back into surplus.

“Only National has a plan that will lift productivity and New Zealanders’ standard of living.

National will lift New Zealand’s economic performance by:

  • Cutting taxes for 16 months to put more money in people’s pockets

  • Indexing tax thresholds to inflation so, over time, New Zealanders keep more of their own money

  • Repealing the RMA to free up land supply and dramatically lift investment in infrastructure and housing

  • Accelerate depreciation rates for businesses that invest in new plant and equipment

  • Reduce costs and regulations, such as restoring 90-day trials, so businesses feel confident enough to hire new staff

  • Invest in the transport infrastructure New Zealand needs to get moving again.

“Labour’s policies, such as doubling sick leave requirements, increasing the minimum wage and adding an extra public holiday, will add costs to business and slow our recovery further.

“New Zealanders need a National Government with a track record of getting out of recession.”