The Opposition says Government Ministers' continuing to “shoot from the hip” with comments pertaining to private enterprises have caused business confidence to stall.
National’s Finance Spokeswoman Amy Adams says if the Government isn’t careful, it is going to “rip the guts out of the very strong economy it inherited.”
Her comments follow new data from ANZ, showing business confidence is down slightly on the month prior.
A net 20% of businesses are pessimistic about the year ahead, down 1% versus February.
Last month, confidence rebounded by almost 20% – at the time, Prime Minister Jacinda Ardern called it a “significant jump.”
But business confidence is now “treading water,” says ANZ Chief Economist Sharon Zollner.
Adams suggests Regional Economic Development Minister Shane Jones’ calls for Air New Zealand’s chairman to stand down have rattled businesses.
She also points the finger at the Prime Minister’s signals to the oil and gas sector that Greenpeace’s call to end fossil fuel exploration was “under consideration.”
“The drops we have seen since the election tell us there is a real reason to be concerned that if this Government isn’t very careful, they are going to rip the guts out of the very strong economy they inherited.”
Jones says Adams’ comments are “rubbish” and that she is simply “trotting out lines that you expect to hear in Opposition politics.”
Associate Finance Minister David Clark says Adams “needs to make more serious comments if she wants to be taken seriously.”
He says there are a number of indicators within ANZ’s figures which have gone up and, overall, the trend is “in the right direction.”
The number of firms which are expecting to lift investment, for example, is up five percentage points on the month prior.
Employment intentions are also up, and export intentions are back at pre-election levels.
Crawling, not gliding
Zollner says a “marked divergence” was evident across the retail and agriculture sectors last month, which both sank significantly.
But firms’ views of their own activity, which Zollner says has the stronger correlation with GDP growth, lifted from +20 to +22.
“The economy is certainly not crawling, but it’s hardly gliding along.”
Since the numbers for last month were released, GDP data revealed a fairly lacklustre 2017 fourth-quarter growth figure.
Zollner says that this far into the cycle it is naturally hard to accelerate.
“But while sectors of the economy such as housing and construction may be tiring, record-high terms of trade and a positive outlook for incomes are providing helpful buoyancy.”