rod oram - sustainable dunedin march 2013
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Reinventing Paradise
Rod Oram’s presentation by video to Sustainable Dunedin’s RMA Meeting
Thursday, March 21th, 2013
Why we need a strong RMA… …and LGA, EEZ Act and other laws
Kiwiki on Facebook / Twitter @RodOramNZ
Rod.Oram@NZ2050.com / +64 21 444 839
Agenda
• Slowth • Strategy
• Challenges • Hope
Most of our export markets are holding up
…but we’re recovering slowly
…we suffer from slowth • We’re still recovering slowly …
…helped by rebuild of Christchurch
• Growth could peak at 2.8 % in 2014-15 …dominated by Christchurch
• But will then sink back to its
long-run slow growth average of less than 2%
• Why can’t we grow faster,
longer by earning a bigger living in the world economy?
Our economy is constrained • Despite slow growth, the economy
is constrained by e.g. • Skills and capital shortages • Weak business investment • Limited government investment
• As a result “potential GDP” (the rate at which the economy can grow without causing inflation) is low
• Solution: business strategies and investment that build capacity, value, wages…
• …to grow the economy and living standards faster
We’re growing our exports slowly • Government programmes and investments are not shifting the needle… • …e.g. composition, volume and rate of growth of exports are unchanged
What we owe the world • …likewise our net international liabilities keep getting bigger…. • …2011 an aberration driven by inflow of earthquake reinsurance payouts • We are one of the most indebted of developed countries • We need to earn a bigger living in the world economy… • …Treasury forecasts no change in our performance
Agenda
• Slowth • Strategy
• Challenges • Hope
Government Strategy Mk III • “Business Growth
Agenda” • 6 ingredients of
business growth
Some simple maths • We need to double the size of the economy in 15 years in real terms • To maintain its role, the primary sector needs to more than double • Government wants primary sector to double…grow, say, 10% a year
• The primary sector can: • Grow volume a bit…but real physical constraints in New Zealand • Grow productivity a bit…but historic rate of NZ agricultural productivity
increases about 2% a year • Benefit a bit from higher world prices…but commodity prices moderated
overseas competition and politics • Earn a bit of a premium for NZ quality and brand…but it would need to
break free from retailers’ stranglehold • Stave off overseas competition a bit…but the competition gets ever
better on cost, volume and quality
• Government’s primary sector strategy: incremental growth of current model • …but the primary sector’s current commodity model fails on simple maths
Agenda
• Slowth • Strategy
• Challenges • Hope
Value Creation & Capture
• 1 Fonterra plant in NZ makes infant formula for Pfizer
• 8% Pfizer’s Chinese market share for infant formula
• US$12bn Nestlé paid for Pfizer’s infant formula brands
= 3 x Fonterra’s net asset value
Urban New Zealand • As a nation, we largely define ourselves by our rural and wild parts
• …and we believe rural business underpins the national economy
• Yet, we’re one of the most urbanised populations in the world • …87% of us live in towns and cities • …most people earn livings far removed from the rural economy
• Our urban places are in trouble…. • …their built environments are increasingly unsustainable • …their economies anemic, inward looking
• Christchurch pre-earthquake had a lot of marginal businesses, buildings • Auckland mainly serves only its own population • Wellington’s tourism & events strategy earns little; public sector shrinking • Dunedin is slipping away • …and every smaller town has its own story to tell, positives & negatives
• Challenge: • Reinvent, reinvigorate our urban communities and economies
Yes…
• Radical? • No
• Zero energy? • No
• Growth? • No
• Sustainable? • No
• 21st Century city? • No
…but
Cities vs. Government • What our cities want
• Compact form
• Public transport
• Quality urban design
• Wide choices in housing
• Power to decide, act
• Enough investment
• New economy
• Sustainability
• Local democracy
• What it says we will get
• Urban sprawl
• Roads
• Some urban guidelines
• Narrow choice in housing
• Strong central oversight
• Limited investment
• Old economy
• Economy-Environment “balance”
• Central intervention
Highly centralised spending • Wellington rules…local initiative suffers • National has brought a lot of control back to the centre
Affordable housing…for Germans and Swiss
A challenging view on housing • Why German and Switzerland have stable house prices….
• …because local governments have financial freedom • By Oliver Hartwich, executive director, NZ Initiative…
• …when he was at Policy Exchange in UK • Details - http://bit.ly/13VFRyG
Our future…and the ultimate challenge
• NZ Land: 270,000 sq km • Australia’s 28x NZ
• NZ Oceans: 5.8m sq km • 5th largest in the world • Australia’s 1.4x NZ’s
• Huge responsibility: • …to nurture • …to use responsibly • …to sustain us • …we get $184bn of ecosystem
services for free
• We need new values, systems, learning, collaboration: • …to be sustainable • …to offer hope to the world
Agenda
• Slowth • Strategy
• Challenges • Hope
NZ Vision 2050 • …by a group of young leaders…
• …under the NZ Business Council for Sustainable Development…
• …which morphed into Business NZ’s Sustainable Business Council
• Download at: • http://www.sbc.org.nz/
projects/vision2050
• Vision 2050 Global report at: • http://www.wbcsd.org/
vision2050.aspx
Paradox
Abundance Scarcity
Poverty
Cows Scientists
Poverty
Simplicity Complexity
Poverty
LGA, RMA, EEZ Society
Poverty
Sustainability
Weak Strong
Re-invention
Scarcity Abundance
Wealth
Lacto-pharmaceuticals Milk powder
Wealth
Sustainability
Strong Weak
Wealth
Complexity Simplicity
Wealth
Society.....................LGA, RMA, EEZ
“You’ll have no future…
…if you don’t make one for yourself”
…Johnny Rotten:
“You’ll have no future…
…if you don’t make one for yourself”
…Johnny Rotten:
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