Plans ‘going in right direction’

Press, 28 March 1980, Page 1

Plans ‘going in right direction’

PA Wellington The Prime Minister and Minister of Finance (Mr Muldoon) said yesterday that the 1980 O.E.C.D. survey of the New Zealand economy “should confirm in people’s minds that the Government is taking the right action in planning for the restructuring of the economy.”

“The O.E.C.D. has recognised and welcomed the moves taken last year to abolish price control, to administer the exchange rate more flexibly, to review protected industries, and to liberalise import controls in a controlled manner,” he said. “All of these are key features of the Government’s restructuring plan.”

Mr Muldoon, commenting on the survey’s references to wage rates

said. “The survey underlines that one of the major barriers to adjustment is excessive wage settlements, which hinder the profitability of exporters and all producers.

“As the O.E.C.D. has noted, high wage settlements lead to low profitability, a fall in investment, and fewer job opportunities. The Government is determined to prevent isolated groups forcing this situation on the rest of the economy,” he said.

Mr Muldoon said New Zealand had clearly taken major steps to open up .itseconomy to foreign competition. , “But our adjustment? path would be 10 times easier if we did not faces restrictive trade practices from the major economies,” he said.