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National must hurry up and diversify economy

Today’s significant drop in the global dairy price shows National needs to stop sitting on its hands and come up with a plan to diversify the economy, Labour Finance spokesperson Grant Robertson says.

“Despite Fonterra putting less product up for sale – as it has done in better recent auctions – prices have fallen significantly. With Europe increasing its production levels there’s little chance of a major recovery for the rest of the year.

“After large fluctuations over the past few months, dairy prices are now where they were a year ago – a time when John Key said he expected a rebound.

“New Zealand is too reliant on such a volatile commodity. No sensible long-term investor would put so much of their portfolio in such an unpredictable investment. They would diversify and spread the risk so they are not so reliant on it.

“As a long-term manager of the economy that’s what National needs to do. Despite months of problems with the dairy price showing the risk of National’s approach there has been no real effort from the Government to do this.

“National tried to claim the tough times for farmers were over after a handful of better auctions but the reality is the prices will continue to be well below break-even levels for some time yet.

“National’s complacency amounts to wilful neglect of regions that are suffering from the uncertainty, increasing debt and decreasing investment from dairy farmers. When dairy farmers are in trouble some communities have nowhere else to turn.

“But National doesn’t seem to have a clue what to do. They should already be implementing a plan to diversify the economy to create decent high-paying jobs,” Grant Robertson said.