Dutch disease
No it’s not a virus. It’s our dollar surfing on a dumper. Gareth Morgan and Neville Bennett have both written about it recently. Bennett says “There is increasing evidence that New Zealand is ailing. The symptoms are a high exchange rate, excessive foreign debt and a decline of the manufacturing sector.” The resulting damage if nothing is done, says Morgan, is “a hollowing out of our non-commodity producing businesses, no correction in our household savings rate and in time, a balance of payments/external debt crisis as those factors conspire.” Bennett is not in the camp of those who say nothing can be done and offers some ideas backed up by the IMF. We need more thinking like that.
