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Salient. Official Newspaper of the Victoria University Students' Association. Vol 41 No. 18. July 24 1978

A Different World

A Different World

The biggest change has come in the external environment. A generation ago New Zealand was virtually an offshore farm for Britain in a world dominated mainly by a group of western states and their overseas dependencies. Now most of the dependencies are independent states, a new nationalism is in the ascendant in many, while in others communist regimes or military governments have seized power.

At the same time world trade and economic activity is increasingly being dominated by trade blocs and special economic groupings, particularly those centred on the EEC, the US, Japan, the Soviet Union and the OPEC states.

New Zealand stands isolated outside these large groupings with an economy still based mainly on the export of a limited range of farm products which are essential to none. Our export problems are thus two-fold. First, to secure trade access for our traditional pastoral products in both traditional and new markets. Secondly, to develop new export industries based on our other resources and the skills and imagination of New Zealand's people.

Photo of people protesting

"...administrative firmness has to be brought in to deal with difficult situations. "

Some people consider that I place too much stress on economic issues. They are entitled to their opinion. However, there are certain realities which are very pressing.

First, we are still running a huge overseas exchange current account deficit of around 500 million dollars a year on an exchange transactions basis. This is only half of what it was when my government took office, but it is still too large. The rest of the world does not owe us a living.

Secondly, there is the domestic situation. According to the Government Statistician's projections, the New Zealand labour force will grow by over 100,000 in the next five years. Providing jobs for all these people - including the graduates of Victoria University - is going to be a major task of government.

We cannot do it simply by make-work activity in the public sector since even this generates an additional demand for foreign exchange, even if it is in smaller degree. The only realistic solution is to develop new industries which earn or save foreign exchange and provide the basis for genuine expansion in the rest of the economy.