Changes in World Economy

The post-war era has seen a dramatic transfer of power among the major western powers. In New Zealand, for example, the influence of British finance has diminished in comparison to the influence of American finance. Many of the ostensibly 'British' companies are in fact controlled by American interests. The United States protects its economic and political influence in a number of ways. Stable countries like New Zealand are controlled through international finance institutions such as the International Monetary Fund. Key strategic countries like South Africa are provided with heavy investment from Europe, and protected by buffer states like Angola and Mozambique, where the Portugese colonialists are provided with NATO arms. For countries which do not toe the line there is the lesson of Indochina.

New Zealand's entry into the I.M.F. in 1961 was preceded by a fierce public debate between economic nationalists and the Labour Party on one hand and professional economists and the National Party on the other. In effect New Zealand had no option but to join the I.M.F. The demands of the multinational companies operating in New Zealand could only be served if the economy was restructured. Such restructuring required access to sources of short term and long term loans, and the World Bank was the answer. But once New Zealand joined it had to play the game, and it was the rules of that game which induced a militant response from workers throughout the country.