On Point is our series of quarterly talks designed to empower business. During our most recent event, Sudburys hosted well known independent economist, Cameron Bagrie. What follows are our key takeaways from his insight into the road ahead for New Zealand.
“New Zealand has a repair job ahead of it” – Cameron Bagrie
We’re yet to know the full makeup of our new Government, but one thing is certain – it faces a series of economic challenges that demand substantive leadership and innovative solutions. The Kiwi economy, like so many others around the world is feeling the pinch and there’s plenty of indicators of a challenging few years ahead.
While there is a decent dose of doom and gloom, there is also cause for hope with discipline coming back to the market and opportunity to lay the building blocks for our next economic upswing.
Economic challenges on the horizon
- Economic Reset
Bagrie prefers to use the word ‘reset’ instead of that other R word – recession – and believes New Zealand is on the cusp of a significant economic reset. This reset involves major structural shifts from operating in a low risk environment to instead managing risk and a move from rising inequality to an outright fragmentation of society.
- Education as an Economic Indicator
Amid these economic uncertainties, one significant indicator that holds immense importance is education outcomes. New Zealand has an opportunity to leverage the potential of its education system as a key driver of economic growth and resilience. At present, the picture Bagrie paints about our education system is not rosy.
- Geopolitical Tightrope
New Zealand's unique geographical location places it on a tightrope between major global powers, including the United States and China. While maintaining friendly relations with both, New Zealand must navigate the complex dynamics of this international balancing act more than it has previously.
- Future Government Scenarios
A breakdown of election results suggests that forming a government could be a complex task, with three possible coalition partners around the table instead of a more straight forward two. This will lead to a series of reality checks as campaign promises meet fiscal realities.
- Global Economic Shifts
New Zealand, like the rest of the world, is experiencing significant shifts in the global economy. The decoupling between the United States and China, rising inequality, and a shift toward populism in leadership all have far-reaching implications for the nation's economic future.
- Challenges in Supply Chains
Building resilience into supply chains is critical as the world transitions from a state of abundance to one of scarcity. We’re already seeing growing challenges in supply and their impact on multiple sectors, including food, technology, and energy.
Where there’s cause for optimism
As New Zealand navigates its way through the challenging economic landscape, Cameron Bagrie outlines his thoughts about the key components needed to come out the other side well:
- Identify and capitalise on unique strengths and competitive advantage
- Get the fundamentals right
- Get the right people in the right place to execute the plan around your competitive advantage
- Ruthlessly drive innovation and constant change
Cameron Bagrie's insights offer a pragmatic framework for the road ahead. There’s no question the next few years could be ugly for business, but there’s also opportunity for those who will take risk and keep a proactive mindset.
Our mission is to empower business and right now, that’s more important than ever. If you’d like to chat with us about how we can help you navigate your business through the challenges you’re facing, get in touch. Sometimes an outside perspective can make all the difference.
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