Economic growth – 4% still a long way to go

Don Brash - National Finance Spokesperson

Today’s GDP result should disappoint the Minister of Finance, says National’s Finance spokesman Don Brash.

“GDP growth of 3.5 per cent is still short of the Government’s target of a sustained 4 per cent growth rate and most economists argue that this is the peak in the current cycle.

“What we are seeing is further evidence that the Government has squandered the opportunity to take advantage of the best export conditions in a generation.

“Furthermore, Dr Cullen appears surprisingly unconcerned about Treasury’s medium term growth forecasts of little more than 2 per cent per annum. This is not fast enough to return New Zealand to the top half of the OECD – in fact, it will result in continued relative decline.

“If New Zealand is to be back in the top half of the OECD, it needs to adopt policies which foster sustainable economic growth which will allow the economy to grow faster without generating inflation.

“The reality is Dr Cullen has no policy to achieve sustainable growth of 4 per cent. He simply can’t deal with the issues that matter, such as the tax burden, the regulatory environment and the quality of government investment and spending.

“Only when these things are addressed will New Zealand be able to enjoy sustainably higher growth rates,” said Dr Brash.

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