Our Changing Face

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BACK ON THE MEND

 

Last year’s Census was the first undertaken in 7-years, a delay brought about when the 2011 Christchurch earthquake displaced thousands of residents who moved away from the devastated city that would have made it difficult to track their whereabouts.

 

But even with a series of natural disasters combined with weak economic under pinnings the number of New Zealanders crossing the Ditch has been falling since December 2012. Statistics New Zealand figures bear that New Zealand has man aged a net gain – meaning, there were more arrivals than departures as fewer Kiwis left for Australia.

 

There were also net gains of migrants from other countries led by: the United Kingdom (6,000), China (5,400), India (5,100), the Philippines (2,200) and Germany (2,100).

 

It is expected that these inflows will continue particularly when NZ’s labour market improves as Australia continues with its struggles to add jobs at a suffi cient pace to keep up with their own population growth in a much weakened economy.

 

With unemployment in Australia expected to hit around 6.5% in 2014, one expects the net rise in NZ immigration numbers to hold steady. If that occurs, this would make it New Zealand’s biggest migration cycle story since the early part of the previous decade.

 

But the downside to this story is that New Zealand’s unemployment rate rose to 6.40% in second quarter 2013, from 6.20% in the previous first quarter even as the unemployment rate fell to 6.9% in the last quarter of 2012 from a 13-year high. It’s still not good enough. Unless the differential with Australia’s unemploy ment rate improves in NZ’s favour, its own economic resurgence story won’t be anywhere spectacular as hoped for. We can’t assume so quickly that we’re back on the mend.

 

FIRING ON ALL CYLINDERS

 

Economically, things today don’t appear to look just rosy as yet even as a reporter from NZ Herald – Liam Dann who published a post recently suggesting that New Zealanders need to brace themselves for an economic boom. Dann cited sources such as Paul Bloxhan – HSBC’s Sydney-based chief economist for Australia and New Zealand as saying that for this year the country will be “firing on all cylinders“. Likewise, ANZ economist Cameron Bagrie notes that the latest business and consumer confidence surveys were so strong that it points to economic growth of around 4% by early 2014.

 

Now this may sound a tad too optimistic for some because any news about ‘prospective’ good growth in 2014 always trumps news about the lingering effects of this long recession. But even then, after 5-years in the doldrums since 2008 we may be disappointed that the hoped-for strength of the rebound some economists are now singing as the new tune doesn’t materialise.

 

Good things to come don’t always come as a neat air tight package. A sharp acceleration in economic activity always ushers in new dislocations in some sectors especially in an unbalanced economy. For one, common knowledge dic tates that interest rates will have to rise. If things really begin to boom then interest rates would consequently rise at much faster clips. That will suck out more money from the shallow pockets of many mortgage-holding households.

 

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A MUCH MORE TRICKY SELL

 

Many ordinary New Zealanders will feel the pain first of higher living costs. That’s going to make the economy a much more tricky sell for the current National-led Government during the election period slated this year even as some economists today are telling us that things have a potential of becoming better. The other question is, for whom or how many of us?

 

One can also expect the Kiwi dollar to stay artificially higher for longer as the rest of the world buys into the New Zealand “potential growth story” especially if all that’s coming in from overseas is short-term “hot money” rather than real foreign direct investments committed to long-term capital formation in such areas as light manufacturing and other long-term job-creating value-added ventures. True, the higher dollar should help keep a lid on inflation a bit but it will mean less gain and more pain for non-commodity exporters and fixed wage workers. These are the many “small guys in the room” whose resources aren’t as hefty as the 800-pound gorillas sitting with them.

 

We could also see the economy hit capacity levels in other sectors like IT and construction translating into the same kind of severe skills shortages which we all were worrying about until the 2008 financial crisis hit our shores thanks largely (if not mostly) to the rapacious greed of the Whiz Kids of Wall Street in the United States.

 

IS THIS ALL JUST POPPYCOCK?

 

If real year-on-year growth can manage to hold its course by maintaining a steady and measured ascending curve over the next 3-5 years starting 2014, New Zealand’s labour market will improve and remain relatively healthy. The country’s current high unemployment figures will reverse and the differential widened compared to those in Australia and Europe. When this scenario hap pens, it will continue to drive inwards migration which ultimately means more skills avail able, more connections with the outside world and obviously more consumers of local products and services.

 

Outwardly, New Zealand is progressive in its policies towards diversity, migra tion and social inclusion. In fact, in some ways we are doing better than other countries who are trying to achieve the same goals for diversity. A survey undertaken by the ASIA:NZ Foundation in 2009 claims that nearly 90% of New Zealanders feel that it is a good thing for our society to be made up of different ethnicities, religions and cultures, which is slightly higher than what Australians (85%) think and much more consensual than amongst Europeans whose own figures range from Greece (36%) to Sweden (77%). New Zealanders think Asia is now more important to New Zealand’s future prosperity than all other geogra phical regions except Australia.

 

But that’s all just glitter and gloss on the surface of things because once you peel off the veneer of being “politically correct”, the actual realities happening on the ground are entirely different. The policies may be right (that’s good) but the actual practices aren’t (not good).

 

This time around, the thing that has to really change here in New Zealand is that while the face of its population mix is again being re-sculpted with the influx of new skilled migrants from many other countries our experience in the past tells us that we will probably still be unable to “fire all cylinders”. This has much to do with the prejudice and preferences that many employers across the country apply to discriminate particularly when they don’t describe what they really want in an employee even if that employee-applicant has more than enough qualifications to accomplish the job. If the shape and colour isn’t right, they don’t buy in.

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Now that’s just one of the hidden set-backs that cause much wider and deeper problems which have to be eliminated by a change of attitude among employers. The other is that we also need to rapidly diversify our economic production base because even if we are on track for record dairy production – which provides a huge boost to an economy that gets a fourth of its income from cows, the recurring wealth generated from it doesn’t filter out so easily or spread evenly towards the rest of the population.

 

So, is all this talk about economic resurgence just all poppycock? Well, consider this. New Zealand income levels – which used to be higher and above much of Western Europe’s prior to the deep dislocation crisis New Zealand experienced in the 1970s, have never recovered in relative terms.

 

Here’s a case in point: In 2011, New Zealand’s GDP per capita of $31,585 (ranked 21st out of 34 at purchasing power parity levels) was less than that of some OECD countries and about 60% that of the United States. Income inequality has also widened much at home; the incidence of poverty has increased, implying that significant portions of the population (the struggling middle-class) pretty much still have very modest incomes while the upper 10%, who own more than 60% of the country’s wealth and resources, are living in hog heaven. So, how can you fire all cylinders when nearly 70% of the population just barely manage to get by from pay check to pay check?

 

People do only two things when they have more money in their hands. They either spend or save it. Either way, the money is re-circulated back into the local economy unless it is siphoned-off elsewhere overseas in terms of profit repat riations or hidden in offshore tax haven accounts.

 

ON THE WINDS OF CHANGE

 

New Zealand has and continues to be heavily-dependent on international trade, mostly in agricultural products. Its other principal export industries such as wine, horticulture, fishing, forestry and mining – which make up over half of the country’s exports, rise and fall on the winds of change and are all vulnerable to international commodity prices and global economic slowdowns. Tourism, which plays a smaller but important role in New Zealand’s economy, is just as vulnerable.

 

The country has only small manufacturing and high-tech sectors but investment opportunities exist in chemicals, medicine, food preparation, banking and finance, finished forest products, as well as in franchising. The export sales prospects appear to be for medical equipment, information technology, and consumer goods. On the agricultural side, bright prospects ap pear for fresh fruit, snack foods and specialised (e.g. organic food) grocery items – all which can be produced or manufactured here and exported.

 

Three things that we’re obviously learning here and that need fixing are that: 1) Earnings from agricultural exports and tourism have not been enough to cover the imports of both basic and advanced manufactured goods and other imports (such as imported fuels) required to sustain New Zealand’s economy; 2) There has been an investment income imbalance or net outflow for debt-servicing of external loans, particularly favouring the majority of Australian-owned banks operating in New Zealand; and, 3) It makes sense to enhance and grow further the declining demographic dividend through aggressive but innovative policy implementation reforms, incentives and settling-in follow-through programmes necessary to release the vitality of our migrant communities to sustain New Zea land’s continued development.

 

The last point above is probably the most important. Enabling more of our newer migrants to become true participants and players in our economy would encourage more local consumption, investment and tax revenues. Only with enough social security and social acceptance will our migrants dare to spend more of their money kept in hand. It is an essential way of boosting domestic demand, strengthening the business sector and lessening our economy’s over-reliance on temporary “hot money” investments and vulnerable exports that frit ter away during economic downturns.

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The Marbebe Couple of Taranaki

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Meet Joame and her husband VJ Marbebe a Filipino couple whose desire for a different life and to provide their children with a brighter future were among the decisions which led to move their young family to Hawera New Zealand 9-years ago. Mrs. Marbebe was on a visitor’s visa when she came with her husband, who was employed as a welder with a South Taranaki firm.

 

Visa restrictions meant that she could not work so their family were entirely dependent on Mr Marbebe’s salary to keep them afloat. By the time they paid their rent, monthly bills and loans they took in the Philippines to make their way here, they were left with only $50 a week and that was it. At that time the Marbebe family could not afford a car so groceries were hand-carried home on long walks in biting wind during winter. Garage sales were visited every weekend in search for bargains. It was a rough life on edge but soldiering on was what their family did.

 

The Marbebe’s never stopped talking about the good of New Zealand even as their adjustment period was an especially painful and hard one for the children. But the kids eventually understood the reason for their parents’ sacrifices. Today, everything they have they worked hard for – well-paying jobs, owning a modest but well-appointed home, a car and other things which makes life more pleasant. Mr. Marbebe recently got himself a small boat to take around the Taranaki coast in the warmer months. They now call New Zealand home and they’re thankful enough to say that the only way they can give back to their adopted country is by being law-abiding citizens, work hard, and pay their fair share of taxes.

 

The Asian population in Taranaki which include Filipinos stood at 3,200 in 2011, with a projected forecast of 3,800 by 2016. For them as with new arrivals coming into other parts of the country, isolation is a common problem which lasts long after they arrive. There is very little in terms of employment references and family support mechanisms provided by government. So, they keep in touch with their local migrant community and church ministers for any support they can get.

 

STRENGTH OF ITS TALENT POOL

 

Countries that have learned to unleash and cultivate the potential of their migrant populations by applying consistently the right mix of policy and practices over time have reaped the benefits of being able to fire all cylinders. It multiplies and deepens the beneficial effects of any economic upturn all because more people become active economically, engaged and are able to contribute.

 

In so many aspects of our society, leaders are waiting for solutions rather than creating them. The seeds are on hand but aren’t being sown and cultivated. To be quite honest, New Zealand has not yet fully realised the true strength of its talent pool potential given the growing melting pot that exists in the country today.

 

Our immigrants are naturally wired to create. They have the innate power to catapult a life, a business and a career in an instant if but given opportunities to do so. In today’s fiercely competitive global market, we must begin to think more like our im migrants who trust that great opportunities are all around them, in both obvious and not-so-obvious places and spaces.

 

Thinking this way means that we shouldn’t limit those capable of serving the nation in different capacities and capabilities. Rather, we should serve them the means to acquire these opportunities. Rather again, we should serve all for whom we have the opportunity. We shouldn’t limit the jobs and tasks they want or are willing to do. Rather once more, we should allow them all each day to show us what can be done. Likewise, we shouldn’t specify the kinds of oppor tunities we’re looking for. Rather, we should allow opportunities to come from anywhere and surprise us in the process.

 

BLURRING OUR LINE OF SIGHT

 

Unfortunately, many of our immigrant’s more older and longer-settled neigh bours neither believe nor behave in this way. As a result, we are prone to pass by many good opportunities through apathy, laziness, or busyness and in the process have become more myopic, suspicious, clammed-up and insanely political and over-critical for no good reason in the process. This blurs a clean line of sight and bypasses opportunities we might discover instead by engaging with them openly and fairly.

 

New Zealand is still struggling economically at many levels. It is just slowly learning how to reinvent itself from lessons being learned by developing countries throughout the world and particularly Asia. Its businesses and their employees must not only be more entrepreneurial in their mindset, but also more culturally intelligent about themselves and the demographic shift that’s happening in their own backyards settings. That’s why they advance and prosper. This is the only way for our economy to grow and develop organically. We need more people of all stripes to help us continue to create new oppor tunities, cultivate a mindset for constant innovation and widen the space for collaborative inclusiveness for the benefit of all.

 

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INTRINSICALLY VALUABLE TO US

 

The numbers being released so far appear to support the view that inward migration will continue. Overall, New Zealand showed a net gain of 15,200 migrants over the 12-months (in the year to September), compared with a net loss of 3,300 in the previous year. If this trend continues, annual net immi gration might surpass 20,000 by the end of this year.

 

Further Census 2013 data is due to be released in the next few months but early results are pointing to an increasing number of New Zealanders who are born overseas and the numbers of Asian and Pacific migrant communities are expected to grow the most since the last census in 2006. The biggest booms are expected to be coming from the Chinese, Filipino and Burmese communities.

 

Migrant communities are intrinsically valuable to New Zealand as a whole and more so for its major cities like Auckland, Hamilton, Wellington, Christchurch or other rural towns where they settle. They are fabulous in their contribution to these population centres; add zest and real energy, vibrancy, new perspectives and create passion to the place.

 

MORE OF THEM AROUND

 

So why is New Zealand still able to attract people from different parts of Asia as a favoured destination for immigration? For that, much of the answer is explained by what has been happening in both Asia and New Zealand itself.

 

The economic growth performance of China alongside some of the leading members of the 10-country ASEAN Bloc as global economic power houses and as increasingly significant trading partners with New Zealand, has perhaps contributed to the biggest shift in mindsets since the 1997.

 

Likewise, New Zealanders’ changes in perceptions over the last 16-years have resulted in more contact with Asians as there are more of them around. This has helped reduce some of the narrow-mindedness and prejudices that had previously coloured many New Zealanders’ attitudes towards them.

 

These days, New Zealanders’ attitudes towards Asian people in general are be coming more positive, with more than half of non-Asians in this country believing Asian immigration to be a good thing. The more contact non-Asian Kiwis have with its Asian people, the more positive they feel about them.

 

But there is always a dark side to these matters and things. In this case, the state of our economy tends largely to influence perceptions towards biased conclu sions particularly when it takes a dive or remains moribund for any length of time.

 

Thus, when economic optimism decreases there is a marked mental shift of ‘born and bred’ rabble rousers who find it easy to put the blame on our migrants from Asia for taking their jobs and undercutting the labour market. The truth of the matter is that the Asians who are now amidst us have improved workplace productivity since 1997. Likewise, the small businesses they have set up and the cultural contributions they are now making continue to improve New Zealand’s profile as an egalitarian society in the eyes of the world.

 

Filipinos in Auckland | Our Changing Face

 

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