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Speaker 1: Now the man who coined the term rockstar economy has

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Speaker 1: got some tips on how we can become a rock

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Speaker 1: star economy again. He's HSBC Chief economist, Paul Blocks them

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Speaker 1: over here from Sydney. Paul, Hello, it's nice to see you.

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Speaker 2: It's great to be in the studio.

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Speaker 1: I'm really interested in your take on this. Now. I

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Speaker 1: don't reckon we become a rock star economy again if

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Speaker 1: we just keep doing the same thing.

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Speaker 2: What do you think, Well, there's a couple of reasons

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Speaker 2: why I agree with you. I mean, the first one

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Speaker 2: is that the world is a different place. It's changed.

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Speaker 2: You know, when we described the New Zealand economy as

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Speaker 2: a rock star back in twenty fourteen, the environment was different,

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Speaker 2: and so a couple of things have changed, and the

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Speaker 2: geopolitical environment has changed. But the other thing that's changed,

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Speaker 2: of course, is there's a much much bigger focus globally

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Speaker 2: on climate policy as there ought to be. So, no,

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Speaker 2: you can't keep doing the same thing. You have to

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Speaker 2: move on, you have to adjust. And so then the

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Speaker 2: question is what ought you do to try to strive

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Speaker 2: to be that rock star economy again. Well, one thing

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Speaker 2: that's helpful is that it looks as though the central

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Speaker 2: bank has broken the back of inflation. Inflation is coming down,

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Speaker 2: and of course we saw the RBNZ cut rates just

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Speaker 2: a couple of weeks ago, so you're now down that

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Speaker 2: pathway of getting a bit more support. But it's also

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Speaker 2: this means that this is now the right time to

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Speaker 2: start focusing on what it is you need to do

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Speaker 2: to start growing in a broad based sense, So looking

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Speaker 2: at the growth engines that New Zealand's got.

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Speaker 1: So the last time we did it was twenty fourteen,

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Speaker 1: and we did it because we basically had this market

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Speaker 1: open up to US China and they just bought more

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Speaker 1: and more and more of our stuff. Do we get

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Speaker 1: back to the same place by still selling stuff just

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Speaker 1: selling it to someone else, or do we actually try

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Speaker 1: to get more sophisticated. Well, you're right.

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Speaker 2: So one of the things that happened is obviously the

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Speaker 2: market opened up to you. You sold more dairy and

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Speaker 2: meat products into that. You've got more tourists coming through.

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Speaker 2: There was a booming tourist industry at the time. You've

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Speaker 2: done a lot of the sorts of things, the backwork

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Speaker 2: with the free trade agreement and a lot of things

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Speaker 2: that made the economy more competitive to support those things.

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Speaker 2: So now you have to look at what the growth

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Speaker 2: engines are going forward. It still seems to me, at

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Speaker 2: least that the growth engines are going to be about

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Speaker 2: selling agricultural products. That's the biggest part of what you do.

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Speaker 2: It's going to be meat, dairy, it's going to be aquaculture,

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Speaker 2: it's going to be fruit and vegetables.

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Speaker 1: So that leaves us so exposed with climate change, doesn't it?

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Speaker 2: It does, But this is the this is the primary

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Speaker 2: thing that This makes up the bulk of New Zealand's

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Speaker 2: exports at this point in time. This is a lot

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Speaker 2: of where you're comparative advantage lies. But the key is

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Speaker 2: obviously to make those industries as competitive as possible. And

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Speaker 2: as you're right, you're not going to be aiming at

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Speaker 2: just any one trading partner. You've got a broad base

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Speaker 2: set of trading partners to target what you. I think

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Speaker 2: we need to keep in mind is you know China

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Speaker 2: is one of those It still is, of course it is.

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Speaker 2: But of course the rest of Asia is also growing

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Speaker 2: fast too. Now we can look to India which is rising,

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Speaker 2: We can look at Indonesia which is growing quickly. We

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Speaker 2: can look at the asy and countries in general and

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Speaker 2: as they develop and they've got large populations too, what

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Speaker 2: sorts of things are they going to want to buy?

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Speaker 2: And so that's one element. I think. The other element

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Speaker 2: is reviving the tourism industry more. I mean it's picked

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Speaker 2: up a lot since, of course the borders reopened and

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Speaker 2: we've got past COVID and so on, but there's a

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Speaker 2: lot more that can be done in that space too.

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Speaker 2: The key is to get the economy to be as

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Speaker 2: competitive as possible. Yes, to lift productivity and make it

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Speaker 2: as competitive.

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Speaker 1: Why are we so bad at this?

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Speaker 2: Well, we need to do. You need to do reforms

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Speaker 2: that are going to make that productivity left. Well, one

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Speaker 2: thing you need to do is focus on infrastructure. That's

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Speaker 2: a part of what you know, we we and you

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Speaker 2: know I can talk about in New Zealand, but Australia

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Speaker 2: has had a similar situation. We've underinvested in infrastructure for

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Speaker 2: such a long period of time that we've got a

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Speaker 2: large you know, under it, a sort of need for

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Speaker 2: building even more over time. So that's that's one thing

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Speaker 2: we can do. We need to be very sort of

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Speaker 2: clear that we're still attractive to foreign capitals. That's I

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Speaker 2: think you know the growth opportunities for Australia and for

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Speaker 2: New Zealand. Open economies that are medium sized in Australia

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Speaker 2: small here, a small economy. They come from the world.

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Speaker 2: You've got to keep focusing on growing the economy through

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Speaker 2: selling things into the global system, so things that attract

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Speaker 2: foreign capital. We've got to get the settings right in

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Speaker 2: terms of climate policy so that it balances finds the

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Speaker 2: right balance between attracting capital, growing the economy and also

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Speaker 2: achieving the climate goals. These are all not easy things

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Speaker 2: to do, by the way. I mean they're not. They're not.

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Speaker 2: That's why if they were easy, they'd be done already.

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Speaker 1: But they're the sorts of things.

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Speaker 2: You need to You need to focus on growing the

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Speaker 2: pie so that then you can allocate the pie more

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Speaker 2: it spread it across the population more.

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Speaker 1: Paul, it's good to talk to you. Thank you so

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Speaker 1: much for coming, and I hope you enjoy your dinner

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Speaker 1: out in Auckland this evening. I will do give you

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Speaker 1: a good time. That is Paul Bloxham, h Species chief

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Speaker 1: economist out of Sydney, Well out of Auckland to night.

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Speaker 1: Normally in Sydney For more from Hither duplessy Alan Drive,

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