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Current account 'moving into the danger zone'

Thursday 21 June 2012, 6:21PM

By Labour Party

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Urgent action is needed to modernise our economy, with current account figures out today showing it’s moving into a danger zone, says Labour’s Finance spokesperson David Parker.

“The current account deficit is widening to nearly 5 per cent of the economy, even in slow economic conditions when normally the current account deficit would be reducing,” David Parker said.

“For a long time the value of our exports has not covered the cost of our imports and interest bill. Now it’s not even covering imports, and the interest bill is growing much larger.

“While the National Government has been talking about the Government’s deficit, it has been totally ignoring the international deficit,” David Parker said.

“As the ANZ has said today, these figures mean our economy is moving into the danger zone. As it commented, ‘Our high investment income deficit and external debt underscore the need to lift nationwide saving’.

“The National Government’s inadequate tinkering is again shown up. New Zealand needs universal KiwiSaver, pro-growth tax reforms and other help for exporters.

“The National Government has no vision for increasing our savings or growing our exports. Today’s danger zone figures highlight the urgency of change instead of continuing to drift.

“Things are getting dangerous and yet National has no plans to fix it,” David Parker said.