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Treasury Report Underlines the Economy's Dependence on Agriculture

"The New Zealand economy depends too much on agriculture for farmers to be excessively restricted in their efforts to manage adverse climatic events said Tom Lambie, President of Federated Farmers of New Zealand (Inc.).

Mr Lambie was commenting on a recently released Treasury Working Paper which found that climatic events and export/import price shocks tended to have a greater impact on growth in the New Zealand economy than exchange rates.

"As an export-dependent economy, it is important that the Government take on the findings of the report and develop robust economic policy to ensure continued economic viability. The Government should address the barriers that prevent farmers from managing and mitigating the effects of adverse climatic events.

"New Zealand farmers constantly walk a minefield of unnecessary central and local government regulation. An ever-increasing array of compliance costs, regulatory requirements, and administrative delays all hinder the ability of farmers to effectively manage adverse events in a timely and cost effective manner.

Significant obstacles already restrict the development of irrigation schemes, the movement of haymaking equipment on roads, the siting of storage sheds, and add exorbitant costs to resource consents for building water storage dams. The deregulation of road transport was one of the most important measures to help farmers with stock management during the 1998/99 drought yet the Government's latest Land Transport Management Bill threatens to reverse such flexibility.

"The Government should use this report to look carefully at its policies and focus on reducing the compliance and regulatory burden placed on farmers and other businesses to prevent adverse events from severely impacting on the country's economic growth," concluded Mr Lambie.

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