Latest / The SME Stream / John Pask: BusinessNZ Chief Economist on the economy emerging from stagnation, the debt levels

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John Pask: BusinessNZ Chief Economist on the economy emerging from stagnation, the debt levels · The SME Stream

• 0:00
  Speaker 1: New economic forecast to have a look at comes from
• 0:02
  Speaker 1: Business New Zealand. They're calling a GDP number of just
• 0:04
  Speaker 1: under three percent by the end of twenty seven. They
• 0:06
  Speaker 1: see momentum coming in manufacturing, construction, tourism. They talk of
• 0:10
  Speaker 1: asset sales, which is interesting. John Paska is the Business
• 0:13
  Speaker 1: New Zealand chief economist and is well, there's John, morning
• 0:15
  Speaker 1: to you.
• 0:16
  Speaker 2: Good morning.
• 0:17
  Speaker 1: Having had a good look at this report this morning.
• 0:19
  Speaker 1: Year in the retirement healthcare camp of people who say
• 0:22
  Speaker 1: this is all going to be unaffordable and we're going
• 0:24
  Speaker 1: to need to make some fairly serious decisions, do you
• 0:26
  Speaker 1: reckon we're up for it?
• 0:29
  Speaker 2: Well, I think that it's the success the governments are
• 0:33
  Speaker 2: ready sort of kick this can down down the road.
• 0:35
  Speaker 2: But I think there's more and more public debate now
• 0:40
  Speaker 2: that not only from you know, Treasury, but even healthcare
• 0:45
  Speaker 2: organizations and age care that they realize that this is
• 0:48
  Speaker 2: going to have to be addressed, and sooner rather than
• 0:52
  Speaker 2: later would be desirable.
• 0:53
  Speaker 1: And what about the government idea around debt. I mean,
• 0:55
  Speaker 1: I'm so glad people are starting to talk about debt.
• 0:57
  Speaker 1: I mean, the debt is just a problem. I mean,
• 0:59
  Speaker 1: we're not even getting back to surplus until twenty eight
• 1:01
  Speaker 1: twenty nine, and even then it's touch and go. Do
• 1:03
  Speaker 1: you think people get that bit.
• 1:06
  Speaker 2: Well, I think it's been We went through obviously difficult
• 1:08
  Speaker 2: years under COVID, but I think there was almost like
• 1:12
  Speaker 2: an impression that, you know, we had low levels of
• 1:14
  Speaker 2: debt and it wasn't a problem of the sort of
• 1:15
  Speaker 2: government borrowing up the eyeballs and you consider it buying
• 1:18
  Speaker 2: the government to bail you out. And I you know,
• 1:21
  Speaker 2: once you start dealing with really really big numbers, people
• 1:24
  Speaker 2: know the price of the copper coffee, but when you
• 1:26
  Speaker 2: start talking about you know, fifty or one hundred billion dollars,
• 1:28
  Speaker 2: there's their eyes glaze over and they can't really get
• 1:31
  Speaker 2: in that space. So I think unless you actually sort
• 1:34
  Speaker 2: of try and simplify it and sort of say, look,
• 1:36
  Speaker 2: you know, your average household is basically in debt of
• 1:39
  Speaker 2: you know, a couple hundred thousand or whatever, then that
• 1:42
  Speaker 2: sort of gets a bit of reality into the process,
• 1:44
  Speaker 2: as it were.
• 1:45
  Speaker 1: Are you for rasset sales or the regeneration of income
• 1:48
  Speaker 1: from assets?
• 1:50
  Speaker 2: Well, I think you have to look at everything and
• 1:51
  Speaker 2: it's in its own merits. It's not a case of
• 1:53
  Speaker 2: you know, just simply selling off the family silver. But
• 1:56
  Speaker 2: you've got to sort of really question, you know, why
• 1:59
  Speaker 2: do we have stay owned farms, you know, potentially state
• 2:02
  Speaker 2: owned electricity generation and so on. So and it's not
• 2:06
  Speaker 2: only that, but it's actually getting more efficient use of
• 2:08
  Speaker 2: resources and also potentially opening up areas of government monopolies
• 2:14
  Speaker 2: to competition. So you know, private sector generally has greater
• 2:18
  Speaker 2: incentives than the public sector and are not not prone
• 2:22
  Speaker 2: to political motivations. So generally the private sector does better
• 2:26
  Speaker 2: overall and over time in terms of managing assets.
• 2:29
  Speaker 1: Regrowth GDP is next year real, it's going to happen.
• 2:33
  Speaker 2: Yeah, yeah, no, no, it's I think if you're looking
• 2:36
  Speaker 2: at you know, there's a lot of indicators coming out,
• 2:38
  Speaker 2: both both official from stats but forward looking indicators that
• 2:42
  Speaker 2: show really across the board, things are hanging a lot
• 2:44
  Speaker 2: more positive positive. So you know, obviously it starts with
• 2:48
  Speaker 2: business confidence and consumer confidence. Business confidence is high. You know,
• 2:53
  Speaker 2: I've always taken some of these confidence surveys with a
• 2:55
  Speaker 2: grain of salt because people can you know, it depends
• 2:57
  Speaker 2: with the all blacks one or not, and that can
• 2:59
  Speaker 2: determine whether I feel positive. But it's actually the data
• 3:02
  Speaker 2: what's sexually happening at the individual enterprise level. That's the
• 3:05
  Speaker 2: important stuff and that's sexually improving.
• 3:07
  Speaker 1: Good to hear, John, Well done. John Pascu is the
• 3:09
  Speaker 1: Business New Zealand Chief Economist.
• 3:11
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• 3:14
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• 3:17
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