Monitor Economics Q&A: Immigration Expert Andrew Sayers
Every week Thing asks business and community leaders in New Zealand how they think the economy is doing and what they see as the biggest challenges.
Immigration expert Andrew Sayers is a founding partner of investment platform iNZvest, owner of Sayers Advisory Services and chairman of the Hong Kong New Zealand Business Association.
He says New Zealand is at a crossroads and needs a reset, and suggests the country could learn from the Singapore book and develop a long-term strategic path.
“The cost of the pandemic focus is the lack of focus and real traction on forward-looking initiatives, and that will cost us in the long run.”
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How do you think the New Zealand economy is doing right now?
Overall, I have the impression that there is a lack of cohesion and strategy in the governance of the economy. We need a reset and a long-term strategic path.
The figures suggest that New Zealand’s economy has successfully weathered the enormous challenges posed by the pandemic (partly due to expanding public debt).
However, the economy is at a crossroads, challenged by the continued impact of Covid-19, high inflation, rising interest rates, a slowing housing market and the potential for large flows. incoming and outgoing migrants.
Now, more than ever, we need a roadmap for the future as a collective social and business community. Although the gross domestic product figures and forecasts look favourable, there are still many challenges to overcome in the next three to five years.
Covid-19 has presented unprecedented challenges to governments around the world. However, the cost of the pandemic focus here has been the lack of focus and real traction on forward-looking initiatives, and that will cost us in the longer term.
What are you most concerned about right now?
Again – the absence of any coherent central plan.
New Zealand has many entrenched problems. These include:
- The apparent steady decline in the standards of our education system (compared to education globally);
- The greater divide between the haves and the have-nots, and the growing reliance on welfare;
- Multigenerational dependence on the state. In my opinion, a good social protection policy also requires a financial incentive for the unemployed to redeploy. Band-aid policies such as social housing in motels are not enough;
- Lack of investment and capacity in key sectors such as health, education, police, etc.
I am baffled that the government thinks that higher taxation is the path to public debt reduction or economic growth. No government in history has taxed its way to prosperity.
Tax policy/cost is a key decision-making tool for businesses/entrepreneurs. Domestic and foreign companies have a choice of where they base their operations.
We need to redevelop an attractive investment landscape in New Zealand to retain and attract local and overseas entrepreneurs.
The latter part of my career has been working with high net worth non-residents investing in New Zealand, looking to establish business in New Zealand or investing new capital in existing businesses. This in turn creates new intellectual property, improves the skills of already talented Kiwis and ultimately contributes to tax revenue.
As an economy, we need this smart capital. But policies such as a ban on the acquisition of residential real estate (a policy based solely on a political platform, not on the actual data of housing sales), a new high overall tax rate (which in fact generates very few taxes) and changes to increase the amount of investment required for migrants with investor visas are all examples of policies that discourage foreign investment.
As a nation, we have no reason to be elitist about our place in the world. Wealthy members of the international business community have a choice of where to live and invest, and New Zealand is struggling to compete globally within the current political parameters.
What has the past year taught us about the New Zealand economy?
That the fundamentals of what has built the New Zealand economy over the decades have to a large extent carried the New Zealand economy through this pandemic – the agricultural sector and the resilience of many New Zealand SMEs and their owners.
We were lucky with the timing of strong dairy prices at a time when tourism was decimated.
Are you optimistic or pessimistic about the economy this year? Why?
I am by nature an eternal optimist. I’m optimistic that the businesses that have survived (and many have thrived) in today’s environment are adaptable and sustainable. Other businesses will thrive again once the borders open, and we will return to some degree of normality (although it will take months and years to get back to pre-2020 levels due to the enormous task the airlines are faced with reassigning planes, crews and rerouting flights back to our shores).
But I am disheartened by the lack of new ideas from any political party – that the economic, educational and social models and policies (and those of the councils) have remained fundamentally unchanged over the decades, but that the world and society have evolved.
Politics is now more focused than ever on survival, not long-term sustainable politics. Perhaps a radical change in our electoral parameters is the first step in a strategic economic reset.
The Monitor is Stuff’s unique set of information to help the business community better understand the economic landscape and maximize their success. Next to the quarterly snapshot is a economic index showing the speed of growth in different parts of the economy.