Investment in startups the answer, says Parker
Labour's deputy leader says the country needs more companies like Obo, but does not have the conditions to foster them.
David Parker visited the Palmerston North firm, a manufacturer of protective gear for hockey players, yesterday during a day of campaigning in the city.
Visibly impressed with Obo's success - the company supplies gear to about two-thirds of the world's top field-hockey goalies - Parker said it was businesses like this that would grow the economy.
At present there were barriers in the way of such companies, which tended to have large start-up costs, particularly in research and development.
"We need to have economic settings that encourage investment in the high-value export sector," Parker said.
The economy was promoting investment in the Auckland property market instead, he said.
"We need to shift capital into the productive sector."
One method of achieving that was Labour's proposed capital gains tax, but there also needed to be greater incentives to invest in R&D-heavy companies and a lower dollar to favour exporters.
New Zealand could learn a lot from the likes of Denmark and Sweden, where investment in start-ups was part of the economic culture, he said.
"At present our tax system pushes the other way. It gives tax advantages to the business that buys and sells houses in Auckland; that's not how we're going to get ahead."
Getting ahead would require more manufacturing jobs that paid high wages, Parker said.
Obo co-founder Simon Barnett said he agreed with Parker's take. Businesses looking to manufacture top-quality products needed more support, he said.
"If you want to thrive in the world market, you've got to do something different. To do something different you've got to invest hugely in R&D. That's difficult to fund without assistance."
Parker also visited computer software developer Unlimited Realities and Academy Apparel yesterday, before attending two street corner meetings with Labour MP and Palmerston North candidate Iain Lees-Galloway.
At each meeting Lees-Galloway joked Parker could be trusted to be frugal with the Treasury coffers because he had arrived in Palmerston North yesterday on an InterCity bus.
- Manawatu Standard
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