Finance Minister Bill English’s blunt message to a Queenstown business audience today: “The developed world is stuffed”.
English, fresh from delivering his so-called zero Budget last week, told those at a Chamber of Commerce Queenstown luncheon up at Skyline restaurant: “If you’re waiting for the world to settle down, you’ll be waiting till you’re retired.
“It’s not going to happen. Get used to a dark cloud on the horizon…the developed world is stuffed.
“By that, I mean it has a huge problem with debt and hasn’t started dealing with it yet.”
English, also the Deputy Prime Minister and MP for the Wakatipu’s Clutha-Southland electorate, didn’t spend his whole lunchtime speech being a doom merchant.
New Zealand’s debt is coming under control and Kiwis seem to have the right message about the importance of reducing their household debt, he says.
“Across the UK, US and Europe their debt is still growing. There’s only two ways of dealing with it, pay it off or write it off but they’re doing neither. They’re just shifting it around because the politicians are in charge.
“You’re going to have frequent crises for the next 10 to 15 years because you’re seeing the end of a way of life – welfare driven states propped up by debt.”
However, English is buoyant about New Zealand’s prospects, saying job growth is reasonable and savings are picking up.
“And don’t forget the benefits of our location,” English told diners.
“We have a huge opportunity because we’re on the doorstep of the fast-growing Asian economies – they want more of our food, more of our holidays.”
English says the middle-class in Europe is growing fractionally and actually shrinking in the US, but in Asia-Pacific it’s exploding and would climb from half a billion to three billion people in the next three years.
“So our problem is not if we have markets, but if we can get organised to take advantage of those markets.”