N.Z. Economy 'Much Sounder’: Mr Lake

Press, Volume CII, Issue 30113, 23 April 1963, Page 8

N.Z. Economy 'Much Sounder’: Mr Lake

Everyone desired an increase in the rate of economic growth, and he thought his hearers would agree that this depended considerably on the ability of individuals and companies to save from current income for investment, said the Minister of Finance (Mr Lake) when he addressed a Christchurch Businessmen’s-Club luncheon meeting yesterday. ft also depended on the abilities and skills of the country's labour force and on the propagation of new ideas and the use of innovations in industry. Over all it was necessary to maintain stability and business confidence, he said.

The last -two years and a half had been difficult in some respects, but ' he was haippy to say the New Zealand economy was now on a much sounder bapis. Export income this June year should be at a record level of £323m —it could well be £32Bm—and the overseas reserves were beginning to build up. At April 17 the net overseas assets of the New Zealand banking system amounted’ to £B9m. J'his was £32m higher .than a year ago. This- was a result in part of good export prices but also, Jte felt, a result of

the promotion of more positive economic policies. “The way is now clear for greater advancement," said Mr Lake. "The Government’s plan in 1961 was to restore and maintain stability without upsetting the economy. Tied to this goal was the determination to reduce progressively the rates of taxation and to implement incentive schemes to encourage savings and investment and greater overseas earnings “1 can claim this policy has been most successful. Stability has been restored without causing any upheaval. and much greater economic growth is evident. I am sure the continuation of these policies will result in a stronger and more diversified economy with a higher standard of living for all,” Mr Lake said. Mr Lake had been speaking of the economic challenge faced by New Zealand and of the desire to increase the income, particularly the average individual income, of the people of the country. He said the raising of living standards and the increasing of national output, particularly for export, were not mutually exclusive but were inextricably linked. The foremost problem was undoubtedly the overseas balance of payments. Too often the overseas receipts had been insufficient to meet

overseas payments. In each of the last two June years the export income had been £294m. That sum was not only below what was needed to finance growth but also was quite static.

Mr Lake spoke of the changing pattern of world trade, the European Economic Community, and the possible shrinking of this country’s traditional markets as giving New Zealand further incentives to find new markets. He paid a tribute to the producer boards for what they were doing in the search for new markets.