Report makes grim reading for Labour

"Another report out tonight poses further questions about Labour's stewardship of the economy," according to National Party Deputy Finance spokesman John Key.

The just-released IMD World Competitiveness Yearbook shows New Zealand slipping two places from 16th to 18th, while the gap with Australia has widened, with our nearest neighbour climbing from 7th to 4th.

"This is a long way from a ringing endorsement for Michael Cullen's economic management skills.

"We rank dead last at 60th for environmental laws and compliance which hinder the competitiveness of business."

The report notes that 'in some areas we are again legislating against efficiency'.

The survey now ranks New Zealand at 55th place for introducing new legislation which restricts the competitiveness of enterprise. It also suggests that our investment incentives are not attractive to foreign investors (53) and that our real corporate taxes discourage entrepreneurial activity (45).

"There are some positive aspects of the scoreboard, but it calls on New Zealand to encourage foreign investment by reducing corporate tax rates, which is in line with National Party policy," Mr Key says.

New Zealand has slipped behind Taiwan and Malaysia in both the Asia-Pacific region and the worldwide ranking. New Zealand was 4th on the Asia-Pacific scoreboard last year. We now rank 6th out of the 15 regions listed.

The report also backs access to foreign markets through free trade agreements (China, US); highlights the need for more of a commitment to education strategies and retaining skilled workers; and suggests improving business growth prospects by reducing legislative impediments and compliance costs.

"Michael Cullen can not continue to turn a blind eye to these important indicators. His casual dismissal of business as 'pessimists' hides the real truth about our economic performance," says Mr Key.

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