Rocky ride ahead for agriculture
National Party Finance spokesman Don Brash is predicting a rocky ride for our agricultural sector as the exchange rate
rises, commodity prices soften and New Zealand is left out in the cold on free trade.
He made the comments at the Large Herds Association Annual Conference in Paihia this morning.
"The bad news is that the world economy looks distinctly unsteady at the present time and that's before the highly
uncertain implications of the situation in the Middle East, or of the SARS epidemic, are figured in," says Dr Brash.
"If the traditionally close relationship between world economic growth and New Zealand's commodity prices continues, we
should be battening down the hatches.
"My hunch is that the New Zealand dollar is more likely to appreciate against the US dollar over the next year than it
is to depreciate.
"At around 55 US cents, the New Zealand dollar is in fact at almost precisely the mid-point of its range over the 18
years since it was floated in March 1985," Dr Brash says.
"And now the chances of a satisfactory outcome of the Doha round of WTO negotiations look increasingly bleak.
"But instead of straining every muscle to help the farming sector, or indeed the business sector more generally, this
Government has made life more difficult with a raft of legislative changes.
"From ACC, to OSH and the RMA, the Government has proven itself to be no friend of farming," says Dr Brash.
"If dairy farmers are to prosper, they need what every other business needs - an efficient public sector providing good
quality infrastructure, the minimum of regulatory interference, a tax system which encourages investment and innovation,
as well as vigorous competition among suppliers.
"With the present Government, we're not going to get them," Dr Brash says.