Manufactured exports flex competitive strengths

The high state of competitiveness of our manufacturing exporters should be rewarded with far stronger government focus to kick the economy back into gear, says Bruce Goldsworthy, Manager of Manufacturing for the Employers & Manufacturers Association (Northern).

“Today’s Performance of Manufacturing Index (PMI) at 43.5, the lowest since the index began, reflects uncertainty in world market demand, not in our manufacturers’ competitiveness,” Mr Goldsworthy said.

“Manufacturing is a major strength to be harnessed for these tougher times.

“Manufacturing is rich in skills and skills development, IP, and the biggest source of higher value add for our primary sector, lifestyle products, and to address our environmental issues.

“When the dollar was running at over US76 cents back in July, way over its 10 year average, our manufacturers were still growing their export sales at over 4 per cent a year.

“That’s how competitive they have become.

“Now with the currency back around its 10 year average, 26 per cent lower and under US 60 cents, manufactured exports were 14.6 per cent higher at $4.4 billion in the September quarter, a full third more than our dairy and meat exports combined.

“We call on the new government to take a fresh look at the resilience and competitiveness of our manufacturers. They need the sort of productivity boosting policy package that will deliver:

· accelerated depreciation on plant & equipment

· gradual reduction in the 15 per cent R&D tax credits under the old regime with top priority on new policies to stimulate innovation.

· more investment in skills development

· immigration policy that targets skills shortages

· urgent scrutiny of the Emissions Trading Scheme to bolster investment certainty.

“Overriding all these we need a renewed drive to retain and build even further our export markets.”