By YOKE HAR LEE
It is clear to the business community that industrial development policies touted by National and Labour lack focus.
Mindful of the rhetoric of political campaigning, business leaders are still waiting for concrete initiatives from politicians to speed up industrial development.
The two main parties differ markedly in their approaches. National's policies are broad-based, focused on improving the general business environment, removing barriers to enterprise and trying to remedy the shortage of risk capital by encouraging the stock exchange to establish a new market for start-up companies.
Labour's policies are more extensive and more deeply involved in companies and industries. Among its initiatives it is considering government roles in venture capital, export credit and the formation of Industry New Zealand to focus on industrial development.
Dr Jim Watson, founder of biotechnology company Genesis Research said: "The parties' policies [on industry development] are very diffuse. It is not clear anywhere how the policies are going to be prioritised, or what in the economy has to change. It is the nature of political campaigning to focus on everything, which means there's no real focus."
Firstly, he thinks, our economic problems are deep-seated. Secondly, New Zealanders are hoping for too much if they rely on politicians to provide the answers.
"As a nation, we shouldn't automatically look to political parties and assume they will solve our problems. The business leaders, the community [leaders], the universities are our real leaders."
Lex Henry, managing director of CDL Hotels, said the main political parties had become "very lazy" in their focus on the economy. Government spending as a percentage of gross domestic production would grow, requiring more focused expenditure.
But increasingly, the parties relied on personal tax and GST to meet the expenditure and putting insufficient emphasis on helping industries to grow so their increased profits could be a source of tax revenue.
"We've been through a process of reform, yet politicians have failed to focus on segments of the economy that matter. If you were an investor asking me which of CDL's hotels is the most exciting, I should be able to tell you, as the chief executive officer. If we ask the Government, 'which sectors of the economy do you think will do well, and what's your role in it?' they will say, 'we don't pick winners'. There is a major need for industry policy which addresses the economy by differentiating the industries and the sectors."
Mr Henry said that, in the technology sectors, for instance, policies should clearly state what can be done to provide a highly competitive infrastructure, focusing on the sector's unique needs. Such an approach would embrace a wide range of factors, from education to the Resource Management Act.
For many business leaders, a key priority is development of the export sector.
"The National party is relying on its overall industry policy to create exports," said Graham Boult, national president for the Export Institute of New Zealand.
"That's basically saying, 'we will do what we have been doing for the last nine years' - which is, relying on increased economic activity. I don't believe that is enough."
New Zealand, he said, had only 119 exporters - out of 800,000 or so - whose turnover exceeded $25 million.
"We have got to get everyone moving up a notch," he said. He believed some of Labour's policies, such as an export credit scheme "could stimulate some export growth."
A minister dedicated to export would also go a long way towards creating more export growth.
Mr Boult said many members of the institute did not like Labour's proposals to change the Employment Contracts Act and roll back ACC reforms.
"Their overall business policy will increase costs. Most people are in a quandary. For the first time in many years, manufacturers and exporters who have been ardent National supporters are saying they would like to vote Labour, but they are scared of the changes to the Employment Contracts Act and the ACC."
Gary Paykel, chief executive of Fisher & Paykel, said he was concerned New Zealand would fail to match Australia's attractions as a manufacturing head office, given Australia's new corporate tax regime.
"If we don't match that, New Zealand is going to be in a very serious situation. Any company looking at the Aussies' new rate is going to say why not take it when there is going to be immediate growth to shareholder value just by shifting across the Tasman. When that happens, it is going to be a very lonely time, a hollow time, for New Zealand."
Solid initiatives needed to speed up industrial development
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