New Zealand PM Luxon Addresses Economic Downturn and Growth Plan

Defending the Finance Minister

• 💡 Prime Minister Luxon strongly defended Finance Minister Nicola Willis, calling her "outstanding" and the "best finance minister New Zealand is ever going to have," despite recent negative economic growth figures.
• ✅ He expressed full confidence in her leadership of both finance and economic development portfolios, stating she is doing an "exceptionally good job in a very tough situation."

Explaining Economic Downturn

• 📉 Luxon attributed the -0.9% GDP contraction (Q2 data) to a challenging global trading environment, a loss of confidence post-COVID, and the "longest hangover from COVID" among Western countries.
• ⚠️ He also blamed the previous government for running up debt three times and creating a "hell of a mess," leading to high inflation and interest rates.

Government's Economic Growth Plan

• 📈 The Prime Minister asserted that the economy is currently growing (Q3) and projected to grow even stronger into Q4, with economists forecasting New Zealand to grow faster than Australia over the next two years.
• 🛠️ Key initiatives include fiscal discipline to achieve lower inflation and interest rates, significant infrastructure investment (e.g., $7 billion in construction projects, $1.5 billion Melling interchange), and an investment boost for manufacturing.
• 🌱 He highlighted the "investment boost" policy which allows manufacturing businesses to write off 20% of new plant capital and equipment in the first year to incentivize growth and efficiency.

Regional Disparities and Future Outlook

• 📊 Luxon acknowledged a "two-speed recovery," with rural economies and primary industries experiencing record years, while Auckland and Wellington face ongoing challenges.
• 🚀 He projected 240,000 new jobs over the next four years and anticipated further mortgage interest rate cuts by Christmas, benefiting New Zealanders and stimulating the economy.
• ✈️ The Prime Minister also emphasized the aviation action plan and the role of tourism in New Zealand's economic future, particularly attracting visitors from the Indo-Pacific region.