Keynote speech on economy

MELANIE VERRAN

There are no "big bang" solutions to New Zealand’s economic woes, Prime Minister John Key said this week.

He told 250 people at a Newmarket Rotary Club lunch in Ellerslie on Tuesday that science, innovation and natural resources were the keys to getting New Zealand’s economy back in line with Australia’s.

"Don’t look for a big bang answer, because that big bang is as elusive as a Blues victory," he said.

Science would be at the heart of improving the economy, the environment and social standards, the prime minister said.

"As a country we actually spend too little in science and that needs to change."

Sheep numbers were the perfect example of how better science could boost the economy.

"We now have half the number of sheep in New Zealand than
we used to, but we produce more, and we export more than we used to."

He said "bright scientists" who worked out ways to maximise productivity could take the credit for that, and a new focus on science and innovation would be reflected in the upcoming budget.

Mr Key again dismissed Reserve Bank governor Alan Bollard’s comments that New Zealand’s economy would never catch up with Australia.

"Thirty years ago we earned the same as Australia and 40 years
ago we earned more. So if it’s not possible, why was it possible
then?"

New Zealand has an advantage in its rich natural resources, he said.

"Australia’s agricultural output has dropped 9 percent and New Zealand’s has grown 24 percent because they don’t have water," he said.

The OECD ranks New Zealand as the second wealthiest country in terms of minerals and natural resources per capita, he said, yet "we currently mine one-hundredth of 1 percent in New Zealand".

"We have so much lignite in the South Island that you could convert to diesel that we could make New Zealand self-sufficient for diesel for 200 years."

Taking black sand from the seabed 12 to 16km out was another
option.

Asked about his view on climate change, he said: "I personally think human-induced climate change is happening."

But he dismissed the Kyoto Protocol as a "hoax", saying the answer was not in "writing out a cheque for Russia for polluting a little bit less", but in investing in research.

- © Fairfax NZ News