Gelastic – pertaining to or inclined to laughter; laugh provoking conduct or speech.
There’s much to be glum about.
Finance Minister Bill English listed some of the worries in a speech: after shocks from the global financial crisis affecting the world and in New Zealand we’ve had two earthquakes, finance company collapses, blizzards, drought, PSA in kiwifruit, the costs of leaky homes and schools, loss of life in the Pike River mine and more recently the potential cost of support for AMI policyholders.
But difficult as all that is – and obviously more difficult for those directly affected- the news isn’t all bad.
I’m confident that we are on the right track and there are some good reasons to be optimistic for the next few years.
These include a sound financial system and growing economy; export prices at record highs and trading partner growth is strong – helped by strong ties to Australia and Asia.
Our trade is moving quickly towards Asia. In the year 2000, the United States took 15 per cent of New Zealand’s exports, and China 3 per cent. By 2015, it will be almost the other way round. Exports to China have almost doubled since the free trade agreement took effect in 2008, with dairy and forest products to the fore.
To sum it up, the merchandise terms of trade jumped 10 per cent in 2010. This equates to a lift in national income of more than $4 billion – a boost to the economy equivalent to the full annual value of the October personal income tax cuts.
Our competitiveness with Australia is near an all time high. This is primarily because the New Zealand-Australian exchange rate is at a 20 year low.
In turn, this largely reflects the strength of Australia’s minerals boom. So we are an indirect beneficiary of that boom.
We have reinforced that advantage through the changes to our tax system; a better regulatory system; through our infrastructure programme; via our new financial markets framework; and around our policy process which will continue to make progress year after year.
We also note that:
- Floating mortgage interest rates are at 45 year lows (5.7 per cent) and have halved in the past three years.
- Inflation remains low – setting aside the GST rise, for which everyone was at least compensated.
I appreciate things are tight for many families. But the facts are that after tax wages, as measured by the Quarterly Employment Survey, rose 6.8 per cent last year, compared with annual inflation of 4 per cent.
Since September 2008, real after tax wages have risen a total of 10 per cent. This is very significant, when you consider that in the nine years before that, real after tax wages rose only 4 per cent in total.
And let’s not forget that despite all of our significant global and domestic challenges, the economy has grown in six of the past seven quarters – albeit pretty modestly.
Given all the handicaps that is no mean achievement and there’s more good news: the government’s strategy to lift national savings and make the eocnomy competitive are working:
This recovery is fundamentally different to previous recoveries in New Zealand.
It is not built around consumption, taking on more debt or increased Government spending.
It is built around lifting national savings rates and reducing debt, including the Government’s debt. This will shift resources back towards sectors where we have a competitive advantage and activities we are good at – allowing us to earn our way in the world.
This is a fundamental and much needed change after decades of spending more than we earn.
We have genuine competitive advantages in agriculture and other primary industries. We are a great destination for tourists and we have world-class companies in high-tech manufacturing, education, software, film and other industries.
But collectively, their output has fallen 10 per cent since 2005. We have halted this slide, but we need to accelerate the process and get them growing faster.
The economy is now part way through this adjustment. Private savings rates have lifted sharply and New Zealanders’ appetite for more debt has diminished.
We can see this from looking at credit growth, which is close to zero even though the economy has been growing for eighteen months.
In the short term, higher savings is a headwind. In the longer term, it is required for faster and enduring growth.
I was pleased to see this neatly set out recently by Bank of New Zealand economists. They said gross household savings as a proportion of disposable income is on track to reach more than 5 per cent in the current March year – the best result since 1992.
As BNZ’s economists noted, the process will be a bit painful in the short term, but it is laying the foundations for lasting, quality economic growth over the medium to long term.
Primary industries are already seeing an improvement. This is the best season in decades for lamb, wool, beef and dairy; crop prices are up, horticulture is improving and returns from forestry are also better than they’ve been for years.
Most farmers have used the better than expected income to pay off debt which is why the money isn’t filtering far beyond the farm gate yet, but it will.
The speech then looked at improving government operations, looking at the mix of state assets, the impact of the quakes, the support package for AMI policyholders and why the government doesn’t favour an earthquake levy then concluded:
I’m confident that New Zealanders understand the challenges we face. They are supporting the Government’s direction to be more sensible and disciplined because it is what they are doing themselves.
The challenge now is to build confidence and get on with building a faster-growing economy. The global financial crisis was a major shock.
But on closer inspection the glass is more than half full. For example, by world standards we have:
- low tax rates and generally a sound tax structure
- a flexible labour market
- generally improved regulatory regimes
- certainty about our emissions trading regime
- a financial sector that has remained sound
And on top of this we have strong terms of trade and solid growth in key trading partners.
Now is the time to build on this early momentum. The next year or two will be about getting out of a survival mentality and into growth mode.
We’ve been going in the wrong direction for a long time.
Policies introduced in the last couple of years are starting to get us heading back in the right direction and there is a bright side to look forward to as economic growth accelerates.
Rather than the boom-bust cycle we’ve been used to the fundamental changes from borrowing and spending to investment, saving and exports mean the improvements won’t be temporary.
Giving nature a helping hand isn’t new but this idea of indoor farming takes that several steps further:
Farming is moving indoors, where the sun never shines, where rainfall is irrelevant and where the climate is always right.
The perfect crop field could be inside a windowless building with meticulously controlled light, temperature, humidity, air quality and nutrition. It could be in a New York high-rise, a Siberian bunker, or a sprawling complex in the Saudi desert.
Advocates say this, or something like it, may be an answer to the world’s food problems.
“In order to keep a planet that’s worth living on, we have to change our methods,” says Gertjan Meeuws, of PlantLab, a private research company.
The danger of demand for food outstripping supply is real. Changing methods is part of the solution but that doesn’t have to mean anything as radical as moving indoors.
Improved genetics for plants and stock, through conventional breeding or genetic modification, and more irrigation would be good places to start.
Using the best land for food production rather than bio-fuel crops would also help as would free trade and an end to subsidies which encourage inefficiencies.
Meeuws and three other Dutch bioengineers have taken the concept of a greenhouse a step further, growing vegetables, herbs and house plants in enclosed and regulated environments where even natural light is excluded.
In their research station, strawberries, yellow peppers, basil and banana plants take on an eerie pink glow under red and blue bulbs of Light-Emitting Diodes, or LEDs. Water trickles into the pans when needed and all excess is recycled, and the temperature is kept constant. Lights go on and off, simulating day and night, but according to the rhythm of the plant – which may be better at shorter cycles than 24 hours – rather than the rotation of the Earth. . .
. . . For more than a decade the four researchers have been tinkering with combinations of light, soil and temperature on a variety of plants, and now say their growth rate is three times faster than under greenhouse conditions. They use no pesticides, and about 90 percent less water than outdoors agriculture. While LED bulbs are expensive, the cost is steadily dropping.
Olaf van Kooten, a professor of horticulture at Wageningen University who has observed the project but has no stake in it, says a kilogram of tomatoes grown in Israeli fields needs 60 litres of water, while those grown in a Dutch greenhouse require one-quarter of that. “With this system it is possible in principle to produce a kilo of tomatoes with a little over one litre of water,” he said.
This might work for some fruit and vegetables and intensive indoor growing might revolutionise horticulture but I can’t see agriculture moving indoors.
The most efficient way to raise many crops and animals is outside, working with and supplementing natural water and light supplies rather than excluding them.
New Zealand merino products have won an international medical design award in the United States:
Christchurch based The Merino Company and Mt Maunganui based product development company, Locus Research, have scored a major international win with a Medical Design Excellence Award (MDEA) announced in the United States for their innovative range of merino wool compression garments designed and developed in New Zealand.
The Medical Design Excellence awards . . . recognise the achievements of medical product manufacturers, engineers, designers and clinicians who are responsible for groundbreaking innovations that “change the face of healthcare”.
The compression garments, ‘Encircle Compression Therapy’, were developed for The Merino Company (TMC) by a crack Kiwi team led by Locus Research, partnered with the AgResearch Textiles Group and the Medical Research Institute of New Zealand. Professor Richard Beasley, director of the MRINZ, who is an internationally recognised respiratory physician led the research team which tested the garments.
The Encircle products use textiles made by Levana in Levin (the company is part of TMC).
Compression bandages which have been used to treat chronic venous disease until now have been synthetic. They’ve been difficult to apply, seldom reused and often contribute to skin infection.
Encircle garments are composed of an innovative proprietary material made up of two fibres. The first is merino, which is composed of keratin, also found in the outer layer of the human skin and the second, Thermacool, is an elastane polyester which can channel out moisture from the skin. Merino and Thermacool were weft-knitted into a new structure whereby the merino is placed on the inside for next-to-skin comfort. The result is a comfortable garment that creates a micro environment around the skin to assist and regulate the skin or wound environment. Unlike other existing therapies, Encircle garments are convenient for wearers – the knee high garments can be pulled on, and zipped up, rather like a snug sock. The garments can be purchased in three pressure grades from light to firm. . .
Production of Encircle is already underway, with significant order already produced for the Australian pharmacy market, through pharmacy distributors, Symbion Pharmacy Services, and TMC is also working with medical distributors in New Zealand, Scandinavia and the United Kingdom. . .
Bythe Rees-Jones, lead designer for the Encircle project for Locus Research, said merino derived products were already being used in a variety of medical products, such as keratin protein and lanolin, but the team believed merino could offer significant therapeutic advantages for sufferers of CVD conditions when merely used as a fibre, as it has unique moisture absorbent, antibacterial, antimicrobial and odour-inhibiting properties.
Rees-Jones praises the other researchers in the Encircle team such as Dr Stewart Collie, from the AgResearch Textiles Group for “his amazing knowledge of textile science”.
Merino is my favourite fabric and it’s rare I don’t wear at least one item of clothing made from it.
In summer I wear merino tee shirts – they’re cool when it’s hot, don’t get cold if they get wet and don’t get smelly when the wearer sweats.
As the season changes and weather cools I opt for longer sleeves and add extra merino layers until I’m warm enough for the worst of winter.
The fibre has proved itself in work and fashion wear it’s great to see it now has a use in the treatment of health problems.
Encircle is a wonderful example of the potential for diversification into “farmaceuticals” which will add value to New Zealand’s primary produce and the wider economy.
Hat tip: RadioNZ
Fonterra agreed to freeze the price of milk for the rest of the year but other dairy products are getting more expensive:
The price of cheese and yoghurt could be on the way up at a supermarket near you.
Cafe owners supplied by dairy processor Goodman Fielder have received word the price they pay for some dairy products will go up from next Monday.
Some say that’s a result of Fonterra’s freeze on milk prices, and the same could happen in supermarkets.
Fonterra CEO Andrew Ferrier was interviewed about this on Campbell Live last night. He said the company’s profit margin on milk was around 12%:
“All we do is run a milk price which converts the world market price to the New Zealand equivalent,” . . .
Mr Ferrier says it is the distributors who set the price consumers pay in the supermarket.
“Ultimately it’s the distributors who are buying product – whether you are in a dairy or a supermarket – who will set pricing polices as they see fit.
“They buy from us and they have there own pricing policies.”
He reiterates that Fonterra is not pointing the finger at supermarkets, saying price structures are often very complex.
“I’ve been in business a long time, the last thing you do is try to put important customers in a difficult situation – and I won’t.”
I have no doubt that price structures are complex but how often do you see milk, cheese or yoghurt on special?
What about other basic foods – meat, eggs, bread, fruit and vegetables?
Is it my imagination or are non-staple foods and grocery items on special much more often than the staples, most of which are produced domestically if not locally?
Regardless of the answer to that question, higher prices for goods we export are good for the country. Producers are already benefitting from better returns and that will filter through the economy. Unfortunately the higher prices are filtering through first which makes it difficult for people on limited budgets.
But the problem of affordability is not high prices it’s low wages and better prices for exports is one of the best ways to improve them.
On April 13:
1111 – Henry V was crowned Holy Roman Emperor.
1250 The Seventh Crusade was defeated in Egypt, Louis IX of France was captured.
1570 Guy Fawkes, English Catholic conspirator, was born (d. 1606).
1598 Henry IV of France issued the Edict of Nantes, allowing freedom of religion to the Huguenots.
1742 George Frideric Handel’s oratorio Messiah made its world-premiere in Dublin.
1743 Thomas Jefferson, 3rd President of the United States, was born (d. 1826).
1796 The first elephant ever seen in the United States arrived from India.
1808 Antonio Meucci, Italian inventor, was born (d. 1889).
1829 The British Parliament granted freedom of religion to Roman Catholics.
1849 Hungary became a republic.
1852 F.W. Woolworth, American businessman, was born (d. 1919).
1861 American Civil War: Fort Sumter surrendered to Confederate forces.
1866 Butch Cassidy, American outlaw, was born (d. 1908).
1868 The Abyssinian War ended as British and Indian troops captured Magdala.
1870 The Metropolitan Museum of Art was founded.
1873 The Colfax Massacre took place.
1892 Arthur Travers ‘Bomber’ Harris, British Air Force commander, was born (d. 1984).
1892 – Sir Robert Alexander Watson-Watt, Scottish inventor, was born (d. 1973).
1895 Sir Arthur Fadden, thirteenth Prime Minister of Australia, was born (d. 1973).
1896 The National Council of Women was formed in Christchurch.
1902– James C. Penney opened his first store in Kemmerer, Wyoming.
1902 Philippe de Rothschild, French race car driver and wine grower, was born (d. 1988).
1906 Samuel Beckett, Irish writer, Nobel laureate, was born (d. 1989).
1919 The Establishment of the Provisional Government of the Republic of Korea.
1919 Jallianwala Bagh massacre: British troops massacred at least 379 unarmed demonstrators in Amritsar, India. At least 1200 wounded.
1919 Eugene V. Debs entered prison at the Atlanta Federal Penitentiary in Atlanta, Georgia for speaking out against the draft during World War I.
1920 Liam Cosgrave, fifth Taoiseach of the Republic of Ireland, was born.
1921 Foundation of the Spanish Communist Workers’ Party.
1923 Don Adams, American actor and comedian, was born (d. 2005).
1931 Jon Stone, co-creator of Sesame Street, was born (d. 1997).
1939 In India, the Hindustani Lal Sena (Indian Red Army) was formed and vows to engage in armed struggle against the British.
1941 Pact of neutrality between the USSR and Japan was signed.
1943 World War II: The discovery of a mass grave of Polish prisoners of war executed by Soviet forces in the Katyń Forest Massacre was announced, alienating the Western Allies, the Polish government in exile in London, from the Soviet Union.
1943 James Boarman, Fred Hunter, Harold Brest and Floyd G. Hamilton took part in an attempt to escape from Alcatraz .
1943 The Jefferson Memorial was dedicated in Washington, D.C. on the 200th anniversary of Thomas Jefferson’ss birth.
1944 Diplomatic relations between New Zealand and the Soviet Union were established.
1945 Judy Nunn, Australian actress, was born.
1945 German troops killed more than 1,000 political and military prisoners in Gardelegen.
1945 Ninth American army crossesdThe Elbe River.
1948 The Hadassah medical convoy massacre: In an ambush, 79 Jewish doctors, nurses and medical students from Hadassah Hospital and a British soldier are massacred by Arabs in Sheikh Jarra near Jerusalem.
1949 Christopher Hitchens, English-born journalist, critic, and author, was born.
1953 CIA director Allen Dulles launched the mind-control program MKULTRA.
1956 Peter ‘Possum’ Bourne, New Zealand rally driver, was born (d. 2003).
1969 Closure of the Brisbane tramway network.
1970 An oxygen tank aboard Apollo 13 exploded, endangering the crew and causing major damage to the spacecraft en route to the Moon.
1974 – Western Union (in cooperation with NASA and Hughes Aircraft) launches the United States’ first commercial geosynchronous communications satellite, Westar 1.
1975 Bus Massacre in Lebanon: Attack by the Phalangist resistance killed 26 militia members of the P.F.L. of Palestine, marking the start of the 15-year Lebanese Civil War.
1976 The United States Treasury Department reintroduced the two-dollar bill as a Federal Reserve Note on Thomas Jefferson’s 233rd birthday as part of the United States Bicentennial celebration.
1983 Harold Washington was elected as the first African-American mayor of Chicago.
1987 Portugal and the People’s Republic of China sign an agreement in which Macau would be returned to China in 1999.
1992 The Great Chicago Flood.
1997 Tiger Woods became the youngest golfer to win The Masters Tournament.
Sourced from NZ History Online & Wikipedia