This article is part of a series of blog items contributed by Charles Broad, Convenor of the Pacific Exporters' Network (PEN). The aim is to assist our understanding of the new economic order that Covid 19 will trigger in coming months and years.
The views expressed are the result of research over the last 2 years aided by the unprecedented disruption to the world economy since the start of 2020.
PEN is a Wellington based volunteer network that has been operating for 7 years. It's members are Wellington based Pacific exporters and those who support greater New Zealand business interaction throughout the Pacific region.
PEN seeks greater recognition of the role that the Pacific has had in the past and will play in the future as New Zealand is forced to reset its trade compass post Covid – 19.
Covid – 19's impact on New Zealand's future trade activities cannot be understated. We note that Ministers and bureaucrats seem to assume that within a year things will largely return to a pre Covid – 19 state. We very much doubt that that will happen. With much of the world having poorly addressed the containment of the virus, travel restrictions for New Zealanders travelling to much of the world will be severely disrupted for a long time. When one considers that the US Congressional Budget Office forecasts a $US3.7 trillion deficit, a 5.6% economic contraction and 12% unemployment by the end of 2020, it is something never experienced in living memory.
Other countries, including New Zealand are in similar postions. The fall out is going to have major negative impacts that will take many years to fix.
New Zealand was fortunate to tackle Covid – 19 early and fast. Much could have been done better.
It is PEN's hope that the Government's economic recovery plan will be delivered in a similar fashion as its response to the onset of the virus. However, if past preformance is a guide to the future, PEN is of a view that the recovery will not be smooth sailing and will be a roller coaster experience for both our businesses and exporters.
We note that discussions are taking place with Australia about creating a possible Trans Tasman bubble. PEN welcomes this but we think much should be done to either integrate selected Pacific countries into the proposed bubble with Australia or we could create a new stand alone Pacific bubble, should difficulties surface with the discussions with Australia.
Travel restrictions will impede any normal business interaction with much of the world. Bearing this in mind, there is logic for New Zealand to try and quickly establish normal open access pathways with selected Pacific countries. 7% of our population is Pasifika and another 17% are Maori. With 24% of our population identifying as Polynesian it gives validity to creating a Pacific bubble.
In further blog items we will look at what PEN sees as the best way to prosper from a Pacific bubble, that will serve New Zealand and its Pacific neighbours well into the future.
This will see challenges given to long established ways of delivering trade and aid in the Pacific.
We make no apologies for what we say, but major changes are required with haste.