Best of Business

Donald Trump is claiming fresh talks with Iran will begin in coming hours, after calling off strikes against the country. The US President threatened over the weekend to carry out the biggest attack 'since World War Two'. Harbour Asset Management expert Shane Solly explained what this means for the markets. LISTEN ABOVESee omnystudio.com/listener for privacy information.

Car sales are on the rise, according to a new report - but there's one key factor that's leading the charge. BYD, GWM, MG, Chery and Zeekr all appeared in the top 15 car makes for the month, with Chinese-made EVs helping grow overall car sale numbers. Motor Trade Association CEO Lee Marshall says this proves that the market dynamics are shifting. "I think it's a demand for EVs overall, but I think you've got a few different factors that are all playing into each other - and making something of a perfect storm." LISTEN ABOVESee omnystudio.com/listener for privacy information.

IMAX has been seeing a big surge in popularity thanks to films like The Odyssey, and the head of Hoyts is looking to utilise this to meet demand. Event Cinemas currently operates the only two IMAX theatres in New Zealand, in Wellington and Auckland. Film critic Darren Bevan says it's likely Christchurch will get an IMAX theatre - and Hoyts has said there's plans to upgrade existing cinema complexes in Riccarton in Christchurch, Te Awa in Hamilton and Sylvia Park in Auckland. LISTEN ABOVESee omnystudio.com/listener for privacy information.

Chris Luxon's standing by his comments telling struggling business owners to take more responsibility for themselves. The National party leader told a Rotorua business function on Friday to "be adult", responding to a question about the city's struggling economy. He says they had a "parent-child mentality" - and that he didn't wait for the Government when he was Air NZ's CEO. Luxon told Mike Hosking that his government's trying to empower businesses. He says they've partnered with businesses through the fuel crisis, which is different to Labour's approach of dictating to businesses through Covid. LISTEN ABOVESee omnystudio.com/listener for privacy information.

When the cost of living crisis is driving your day-to-day costs up, putting money in to a Kiwisaver might not seem appealing. But is it still important to keep the flow of money in to Kiwisaver going? And what do you do when you want to get started investing in an index fund? Founder and Managing director of Koura wealth Rupert Carlyon joins Tim Beveridge for Smart Money to discuss. LISTEN ABOVESee omnystudio.com/listener for privacy information.

A Rotorua business leader told Prime Minister Christopher Luxon about the city's struggling economy at a function, prompting the PM to tell business owners to 'be adult'. Luxon was in Rotorua last week with appointments including the recent Business Chamber Westpac Smarts Breakfast. Newstalk ZB political reporter Ethan Griffiths says Luxon's comments have prompted outrage, with Labour condemning him for 'lecturing' business owners about the state of the economy. LISTEN ABOVESee omnystudio.com/listener for privacy information.

Manufacturing and construction are showing signs of recovery. ANZ's latest Business Outlook survey finds confidence rose 19 points over the last month, to 56%. In terms of past activity, manufacturing was highest, while agriculture saw a marked fall and construction lifted. ASB acting chief economist Kim Mundy told Andrew Dickens the construction sector has been struggling for some time, so this is welcome news. She says it's good to see the rise in residential consents transfer into activity. LISTEN ABOVE See omnystudio.com/listener for privacy information.

South Island business leaders want to be recognised as the engine room of New Zealand's economy. The eight chambers of commerce have launched a joint manifesto, representing around seven thousand businesses. It calls for policies to lift productivity, with a goal of increasing South Island GDP per capita to at least $130 thousand by 2035. Business Canterbury CEO Leeann Watson told Mike Hosking it shows there's great alignment across the South Island. She says if New Zealand wants stronger productivity, higher incomes, and greater resilience, backing the South Island is the smartest investment. LISTEN ABOVE See omnystudio.com/listener for privacy information.

It's been a big week for the tech sector, with Meta and Microsoft moving to post their earnings. But it's sparked concerns about the future of AI, and whether or not another sector bubble is set to burst. Sam Dickie from Fisher Funds explained further. LISTEN ABOVESee omnystudio.com/listener for privacy information.

Auckland's Watercare is taking a mixed approach to funding a $15.2 billion capital investment. This includes $4.3 billion for renewals, upgrades to prevent wastewater spills, and lifting the daily flow of drinking water from Waikato River to $300 million by 2033. Watercare CEO Jamie Sinclair says separating from Auckland Council means the utility will need to explore new funding streams to get this through. "We've got to go find our own debt funding, which we've been pretty successful at, I'd have to say, over the last year or so." LISTEN ABOVESee omnystudio.com/listener for privacy information.

Farming is powering strong small business sales growth. A Xero Small Business Insights report reveals an 8.6% year on year increase in sales in the June quarter. Agriculture saw a 16.3% increase, construction climbed 11%, and manufacturing rose 8.6% during the same time period. Country Manager Bridget Snelling told Mike Hosking it is a bit of a two-speed recovery, with retail only growing by 6.4%. She says there's some ongoing uncertainty around fuel costs and geopolitical events which will continue to influence small businesses when it comes to hiring and investment decisions. Plus, Snelling told Hosking, consumers are still going to be a bit circumspect with their discretionary spend heading towards the election. LISTEN ABOVE See omnystudio.com/listener for privacy information.

ACC's outgoing chief executive Megan Main has defended her record at the helm of the troubled Government insurer and insisted that a new progress report shows the agency is effecting a turnaround. Main's last day at the helm is Friday, and her five-year contract runs to November. NZ Herald Wellington business editor explained further. LISTEN ABOVESee omnystudio.com/listener for privacy information.

The US Federal Reserve is set to meet soon, and it's unclear what investors and experts can expect this time round. It's looking likely that rates will stay on hold, but the ongoing Middle East conflict has made the market cast doubts. Milford Asset Management's Brendan Larsen explained further. LISTEN ABOVESee omnystudio.com/listener for privacy information.

FIFA has announced plans to sell the commercial rights to its tournaments, including the World Cup, to private investors. This proposal has been dubbed controversial and sparked backlash from Uefa and some leading European clubs. Former All White Fred de Jong says this isn't a good idea, and there's some 'worrying' aspects that could come from this. "You give it to a third party who would have a non-controlling stake in that separate company - but still, they would have a lot of influence, and they would have shareholders who want to maximise the profits. What are they going to want to see?" LISTEN ABOVESee omnystudio.com/listener for privacy information.

Conversations about reintroducing maximum sustainable employment to the Reserve Bank's monetary policy mandate and inflation targeting could be back on the table, following recent comments from Winston Peters. Peters had to let this issue go during the last round of coalition negotiations, but speculation indicates he's like to bring the issue up again the next time round. Infometrics Principal Economist Brad Olsen says there would be very little, if any, differences to the current state of the OCR if these changes were implemented. "The Reserve Bank is not dumb, they're not looking at the economy and going - well, if only we completely ignore the labour market. You can't ignore people in the economy and their jobs, so realistically - no , we wouldn't expect any real change." LISTEN ABOVESee omnystudio.com/listener for privacy information.

There are two ways to look at this oil and gas announcement today. Aussie outfit EnZed Energy's been given the nod to go have a sniff around off the coast of Taranaki. That's important because they're the first company to be given that right since the Ardern ban. But there's already talk online about the fact this was the only application. There was nobody else applying for this permit, and it's just to have a poke around. Now, you would say this proves the point that there's not much interest and, therefore, why bother anyway? But what it actually tells you is people are still bloody scared of the ban coming back. With good reason. Labour and the Greens say they'll bring it back. I asked someone in the sector about this, and they said, "When that bulls*** goes away, we'll get more interest." There's apparently another handful of permits been applied for. But this Aussie start-up is the first, and they're basically the guinea pig. The test run. It's a small step on a long road to re-building an industry that's basically in pieces on the chopping room floor. The fact is, Labour doesn't need to be sitting in the Treasury benches to have power over industry. They're what corporates call a "regulatory risk". They don't like those. My question to Hipkins and co. is pretty simple - NSW has just gone out to market on two tenders for offshore gas exploration. Why should they get the jobs and not us? Why should they get the royalties and not us? Why should they get the company tax and not us? What is the point in being cool on the climate when even our next-door neighbours are doing the exact opposite? LISTEN ABOVESee omnystudio.com/listener for privacy information.

The Government is introducing new regulations to help poultry farmers navigate bird flu, and industry experts are welcoming the changes. Operators with more than 100 birds will be required to create a farm biosecurity plan - setting out how they will prevent and manage the disease. Poultry Association head Fiona MacMillan says it's helpful for everyone to be on the same page about the outbreak. "I think having a standard that's applied consistently across industry can only be a good thing." LISTEN ABOVESee omnystudio.com/listener for privacy information.

The rising cost of living is down to more than global uncertainty, according to one expert. Stats NZ data shows costs for the average household jumped 3.2 percent annually to June, a more than four-year-high. Petrol was the biggest contributor - skyrocketing more than 27 percent. Independent economist Cameron Bagrie says shocks like US tariffs and its war with Iran play a role, but core inflation is still higher than before Covid. "But there's a little bit more of a sticky persistent inflation - it's the obvious drivers like rates, it's your insurance, it's your energy bills, which the Reserve Bank can't control." LISTEN ABOVESee omnystudio.com/listener for privacy information.

Nicola Willis will like the inflation number that's come out. More importantly, she'll like the story that number is telling. Remember, her target audience is the squeezed middle. This is the battleground. This is the fight for the soft centre at the election: Labour versus National. These are the voters both parties are targeting. The Stats NZ figure for the year to the June quarter is 3.2 percent. Prices are up for the average Kiwi family. On the face of it, that doesn't sound like good news. But for the roughly one-third of Kiwis who own a home, aka the squeezed middle, the number is better than it could have been. That's because this figure is based on the Household Living-Costs Price Index, not the Consumers Price Index (CPI). CPI inflation is 4.1 percent. This measure is lower at 3.2 percent. Why? Because it takes into account the cost of mortgage interest payments. And the mortgage-interest story is a good one. On these numbers, mortgage interest payments are 15 percent cheaper. Just imagine how bad this figure could have been if interest rates hadn't fallen, or if the Reserve Bank hadn't had the headroom to cut rates. You can see where I'm going with this. If you're an average home-owning family with two kids in New Zealand, you know how important your mortgage is to your sense of financial wellbeing. The smaller it is, the better you feel. So Nicola Willis will see this number as positive for two reasons. First, she'll claim some credit for helping bring mortgage costs down by 15 percent. Even though that's largely the Reserve Bank's doing, she'll argue that the Government created the conditions that made it possible. Second, she'll blame Donald Trump for prices continuing to rise, which isn't entirely untrue. A third of the annual increase is due to petrol prices and that's tied to events involving Trump and Iran. This helps National because it's running this election not only on its own record, which, let's be honest, has been patchy, but also against Labour's record. It's playing the "don't put it all at risk" card and it's playing that card hard. You would have heard that from Nicola Willis on the show. The only problem with these numbers is that they're backward-looking. Yes, interest rates have been coming down but they're starting to climb again. Westpac has moved on fixed rates and you can bet your bottom dollar the other banks will soon follow. LISTEN ABOVESee omnystudio.com/listener for privacy information.

Origin Energy has confirmed the full extent of how many Australians were impacted by the recent hacking scandal. In an update to customers, the energy giant said 900,000 current and former customers had their data accessed. Australian correspondent Murray Olds says the hackers got access to important information, including names, addresses, dates of birth, and payment histories. LISTEN ABOVE See omnystudio.com/listener for privacy information.

Auckland's Snowplanet has partnered with one of NZ's leading commercial solar companies, Sunergise, to produce more snow for less energy. The new system features 2,317 ground-mounted panels on the hillside adjacent to the main facility, in order to create 80 cubic metres of fresh snow every week to keep the experience going for skiers. Snowplanet general manager Rojie Aguilar says the clean energy is a plus - and it will save the company power as well. "It covers 30 percent of our overall power bill, because we're a 24-hour operation. So during the day, it covers the whole - if it's sunny, obviously - the whole environment." LISTEN ABOVESee omnystudio.com/listener for privacy information.

A digital marketing agency says more New Zealanders are turning to TikTok to decide where to eat and shop. A new Infometrics report shows the app supported almost 10 thousand local jobs last year and helped boost the local economy by an estimated $1.2 billion. It reveals more than 300 thousand New Zealand businesses are using the platform each month. Squid Group founder Laurence Carey told Andrew Dickens it's becoming a useful research tool. He says it's without a doubt the easiest way to find a restaurant to eat at or something to do. LISTEN ABOVE See omnystudio.com/listener for privacy information.

TikTok's proving to be a powerful tool for New Zealand businesses. A new Infometrics report shows the social media platform helped boost the local economy by an estimated $1.2 billion last year. It found more than 670 thousand New Zealanders are visiting restaurants and cafes or making other purchases after discovering them on TikTok. Infometrics Principal Economist Brad Olsen told Mike Hosking around 50% of businesses in New Zealand reckon they're using TikTok in some way, shape, or form. Of that number, he says, around 15% don't do anything paid, instead just posting organic videos, which is a low cost but effective way to get in front of a whole bunch of eyes. LISTEN ABOVE See omnystudio.com/listener for privacy information.

Queenstown's famous gondola and luge operator continues to reach new heights. Skyline Enterprises has reported revenue of $239.3 million, up 15%, while net profit more than doubled to $86.1 million in the year to March. International visitor numbers from its key markets have now surpassed pre-Covid 2019 levels. CEO Geoff McDonald told Mike Hosking the Iran conflict is influencing where people travel, and is helping New Zealand's shoulder season. He says there's a clear rise in the number of Americans coming through. LISTEN ABOVE See omnystudio.com/listener for privacy information.

Kiwi furniture brand Mocka is preparing to open its first standalone physical store in New Zealand, nearly 20 years after it began operating. Originally selling kids' furniture online, the business' range expanded to curated collections across key sectors, and it's set to open its first bricks-and-mortar store in Christchurch. Mocka chief executive Catherine Williamson says the brand's not looking to compete with Ikea - and it'll do things the 'Mocka way'. LISTEN ABOVESee omnystudio.com/listener for privacy information.

Telecommunications company Spark has reorganised its operations into two divisions to reflect an increasing focus on core services. The core telco and IT services will come under the direction of the Connectivity division, with the other division responsible for Digital Services. Harbour Asset Management's Shane Solly explained further. LISTEN ABOVESee omnystudio.com/listener for privacy information.

Laurie Blyth, owner of the Frontrunner store, has told customers not to use the in-store sizing service, and then buy cheaper online. Blyth has put up a sign outside the store saying staff will ask customers if they intend on shopping online before they fit them. Consumer NZ chief executive Jon Duffy says this will be difficult to enforce as customers could just fib, but there's nothing wrong with this move. "They also absolutely have the right to ask the question, and if someone says - yeah, I'm just using the sizing service you're paying for to size up a shoe so they can buy it online, it's perfectly within the shopkeeper's rights to say they're not going to offer that service." LISTEN ABOVESee omnystudio.com/listener for privacy information.

An infrastructure advocate says the introduction of new AI data centres requires careful consideration. The Green Party wants a one-year pause on new centres, while rules for the industry are developed. It says the already consented facility in Southland is expected to use about 6% of the country's total electricity supply. Infrastructure New Zealand Chief Executive Nick Leggett told Mike Hosking that the benefit to New Zealanders must have weight in any new consents. He says the door to data centres should be open - but with adequate checks and balances. LISTEN ABOVESee omnystudio.com/listener for privacy information.

New Zealand businesses are selling like hot-cakes. ABC Business Sales' latest report shows there were 503 completed sales over the last 12 months, up 19 percent on the year before. The business broker says New Zealand is still in a seller's market with an average of 34 buyers per new business listing. Managing Director Chris Small says they're sending out huge numbers of confidentiality agreements to people who want to look at the details behind businesses. He says more than a 100 of these are signed, for the most popular businesses. LISTEN ABOVESee omnystudio.com/listener for privacy information.

Support for National's paid parental leave policy, from at least one business leader. The party's promising to extend paid parental leave from the current 26 weeks, to 30 weeks by 2029 if re-elected, with further increases possible if finances allow. Parents would also have more flexibility to share, or take leave at the same time. Business Canterbury CEO Leeann Watson told Andrew Dickens that most small businesses would already be paying for some additional cover regardless. She says hiring someone for slightly longer, could make things easier, as it can be challenging finding someone for a short term role. LISTEN ABOVESee omnystudio.com/listener for privacy information.

The AI is now breaking out of its containment. Should we be afraid? Boy, it's almost like Hollywood predicted this! Our worst fears about AI have come true, with OpenAI saying its new ChatGPT model managed to connect to the internet and hack into another AI company's servers. It was meant to be contained, it was not meant be connected to the internet, but it found a way through. These new models are so good, they're finding vulnerabilities and exploiting them all on their own to achieve a goal. JPMorgan Chase's CEO Jamie Diamond was one of the people briefed into Anthropic's powerful model, and said this week that we need to slow things down. He said widespread access to Mythos could create risks comparable to "giving ballistic missiles to individuals". He also revealed that some of the bank's departments have cut 30-40 percent of headcount and moved them to be AI powered. He thinks the claims of mass layoffs because of AI are unfounded but that while jobs have been lost, jobs have also been created. Move over Slack, there's a new chat app in town This one - called Buzz - brings your human workers and AI workers together. Just like you would ask a coworker for something, you can ask your Agent for it too. There can even be managers of agents that have teams of specialists and they handle all the tasks. Buzz comes from one of the founders of Twitter, who now runs Block - the company behind Square and Afterpay. It uses your own Claude or ChatGPT on your computer, is open source (so can he self hosted on your own servers for free). Ford is teaming up with Apple to bring better tech to its cars Apple announced a new offering for Automakers and said Ford would be its founding customer. Basically, Apple is making its map and navigation tech available in-car systems. This isn't an Android vs Apple thing, those will still work just as normal, but this is about the car's actual operating system. It means that the car makers can use the same tech that the iPhone maps use, and get all those benefits without needing to spend huge dollars developing it inhouse. Things like turn-by-turn directions, slowdown information, better visualization.See omnystudio.com/listener for privacy information.

It's been yet another week of yet more unsettling news. The conflict in the Middle East appears to be escalating again. As of this morning, we face even higher tariffs in the U.S than under President Trump's previous measure. But if there's one piece of unsettling news I think we probably haven't grappled with sufficiently, it's the latest humbling episode with one of the world's biggest AI companies. OpenAI admitted yesterday that one of its new models has autonomously broken free of its shackles, escaped from the walled-off environment where it was supposed to be safely tested, gained access to the wider internet, and successfully hacked another company. Legally it's a grey area. There's a pretty strong argument that this was a crime. If a person did it, theoretically they could be charged. But it wasn't a person. It was an autonomous AI model going to fairly extreme lengths in order to solve a problem that had been posed by its creators. Again, it was supposed to be contained. Those same masters who posed it a challenge had thought it was confined in what they call a sandbox, a sort of digital playpen where you can wall in a model and stop it from escaping to the outside world. But like a toddler who pulls themself up and climbs out of a cot, this model got free. AI models are now so good at exploiting cyber vulnerabilities, they can exploit the vulnerabilities of their creators. Ultimately, the model solved the problem it had been set. But at some cost. There were heaps of details that made this whole episode particularly interesting. For starters, it looks like OpenAI didn't really understand what its own model was doing. They couldn't tell in real time that it had escaped and was roaming the internet at large. They couldn't pull a metaphorical power cable out of the wall, because they only realised what it had done after the fact. But if there's one thing to be grateful for in this instance, it's the target of the AI hack. It wasn't a bank or a crypto-currency exchange or a weapons system. It was a start up called Hugging Face which works as an interface for open source AI. If anything, the boss of Hugging Face sounded kind of stoked that his business had been targeted. Of course this is the sort of thing that experts have been warning about for ages. At the most extreme end of the AI doomerism scale, they've suggested these systems could ultimately decide humans are an inconvenience and that the world would be a much better place if computer systems were in charge. And arguably one very important step on the road to AI Armageddon is this - a model breaking free. If you can't be bothered engaging with AI, or even if you think AI is overhyped...this week marks a significant milestone. In one sense, it is incredibly impressive that an autonomous system, operating completely free of human control, is able to pull off something with this complexity. In another sense, it is incredibly unsettling. If this is where the technology is today, who can honestly say where it might be in five or ten years' time? LISTEN ABOVE See omnystudio.com/listener for privacy information.

New Zealand's agriculture sector should be able to withstand the current El Niño weather pattern, although it may lead to increased farm costs, an agricultural economist says. Earth Sciences New Zealand this month confirmed El Niño conditions have been reached the tropical Pacific and are expected to strongly influence New Zealand's weather. The Country's Jamie Mackay explained further. LISTEN ABOVESee omnystudio.com/listener for privacy information.

One of New Zealand's big power companies is throwing their support behind a firm planning to build a large data centre in Southland. Mercury has invested $53 million for a 12.7 percent minority equity stake in Datagrid NZ. Mercury CEO Stew Hamilton says the company's looking to invest in a new growth sector - and there's potential to make more investments like this down the track. LISTEN ABOVESee omnystudio.com/listener for privacy information.

Australia's unemployment rate stayed at 4.4 percent in June, according to the latest Labour Force data from the Australian Bureau of Statistics. The rise in employment was driven by a 47,000-person rise in part-time work, pushing it to more than 4.6 million people, with full-time employment also rising up by 29,300 to over 10 million people. Australian correspondent Murray Olds says the Reserve Bank is looking for unemployment figures to go higher in order to cool the economy down. LISTEN ABOVESee omnystudio.com/listener for privacy information.

Recent data has unveiled a silver lining in the latest June-quarter inflation figures. Rents rose at their slowest rate, annually, in 25 years, according to Stats NZ. The country's stock of rents rose by 0.5 percent between the June 2025 and 2026 quarters, continuing the trend of softening increases that began towards the end of 2024. NZ Herald Wellington business editor Jenee Tibshraeny explained further. LISTEN ABOVESee omnystudio.com/listener for privacy information.

It's been an interesting time for the tech sector, with many big companies reporting their results. Tech stocks recently reversed some of the recent selloff last night - with the Nasdaq up 1.9 percent. Milford Asset Management's Andrew Curtayne explained further. LISTEN ABOVESee omnystudio.com/listener for privacy information.

ChatGPT maker OpenAI said its artificial intelligence system hacked into another AI company on its own - and they're launching a full investigation. AI startup Hugging Face said last week that it had detected an intrusion into its data processing systems that it suspected was caused by an AI agent acting on its own. Auckland University AI expert Dr Kerry McInerny says AI has been used to hack companies in the past, but this incident raises new concerns about cybersecurity. "My fear is that we focus a lot on the capacities of the agent of the AI itself, and that distracts away from the people who I think we should really be holding responsible - which is OpenAI itself." LISTEN ABOVESee omnystudio.com/listener for privacy information.

A new trend has emerged, where people are ordering fake takeaways and filling online shopping carts knowing they'll never receive a thing. This viral trend is gaining popularity, with one platform, FoodNeverComes, claiming nearly 1 million 'cravings satisfied' to date. Queensland University of Technology, Professor of Marketing and Consumer Behaviour, says this gives consumers a version of the online shopping experience in order to stave off boredom. "The research shows that we're more inclined to do online shopping...generally in the evenings. We've got home from work, we've had dinner, we sit down and go - I might just pick up my phone and see what's available online." LISTEN ABOVESee omnystudio.com/listener for privacy information.

US President Donald Trump on Tuesday imposed 50 percent tariffs on most Canadian goods, and concerns have been raised about the economic implications. The new tariffs would exclude energy products, potash, fish and critical minerals, but would cover goods that had previously been protected from import taxes by the United States-Mexico-Canada Agreement. US correspondent Dan Mitchinson says Canadian officials haven't said much, but there's speculation Canada could raise tariffs on their own goods. LISTEN ABOVESee omnystudio.com/listener for privacy information.

The Consumers Price Index (CPI) has increased 4.1% in the 12 months to the June 2026 quarter, according to figures released by Stats NZ today. As expected, the increase can be partially contributed to the US-Iran war as the largest upwards contributor to the annual inflation rate was petrol, up 27.5%. Finance Minister Nicola Willis is labelling annual inflation hitting its highest level in more than two years a “Trump spike”. Former Reserve Bank senior economist Michael Reddell told Andrew Dickens that economists don't tend to look at the headline numbers but they will be digging through the numbers to find trends. "It's a bit like the famous line about democracy, you know, it's not a perfect system, it's just better than any of the alternatives that have been tried, and inflation targeting is a bit like that as well. It's definitely not perfect." LISTEN ABOVE See omnystudio.com/listener for privacy information.

I have so many questions around the Government bailout of Golden Bay Cement, which is not in fact manufactured in Golden Bay, but in Northland. Fletcher owns the company and they said Golden Bay Cement operates New Zealand's only domestic cement manufacturing facility at Portland near Whangarei. It supplies nearly 60% of the cement used in New Zealand – about 95% of its output is sold domestically. Golden Bay Cement took a long hard look at the account books and participated in an independent assessment which confirmed that without support, rising costs —including carbon costs— would force the closure of the company and a shift to an import only model for cement from 2030. So in steps the Government with a $60 million payout. They say it's a specific one-time response to an exceptional set of circumstances, to keep the plant open at least through to 2040. In return, Golden Bay Cement has committed to continue producing cement at its Northland plant at least until 2040 and to invest at least 150 million through to 2040, phased over time. Finance Minister Nicola Willis told Heather du Plessis Allan last night the decision to offer a bailout was not made lightly and does not set a precedent. “We went through three steps. One, this is quite different in that it is strategically so important that you can produce cement for your domestic economy, that you're not exposed to not being able to have cement if there was an international trade disruption. Two, the financial case here is that actually this is a business that is working overall. The key thing is just that emissions cost. And three, we've set in place some really firm requirements that Golden Bay need to meet in order to get this cash with clawbacks if they don't meet those requirements. And that includes keeping production going through to at least 2040 making $150 million worth of investments in that manufacturing capability, keeping the jobs at that factory going, and having an open book exercise with us, the Government, so that we can audit that investment. So we set a very high bar, we took a very case by case approach. Believe you me, I did not want to be setting a precedent that we're going to keep doing this.” Well, yeah, you kind of have set a precedent though, haven't you? Because when you bail out one company, that's precedent. The other companies can say you've done it before, so it's a precedent. And Nicola Willis made the point that, oh, this is a thriving company, it's just that emissions cost. Yeah, about that... that's one of those questions. If it's just that emissions cost, then that's not going to change unless you change our obligation to the Paris Agreement and unless you do as other European countries have done and delay the introduction of the ETS or scrap it all together. So “just that emissions cost” is what's snookering a whole lot of New Zealand companies. Fletcher says that New Zealand manufacturers face carbon costs that importers largely avoid. They want to see a carbon border adjustment mechanism, something they say addresses the structural imbalance directly and would let the ETS work as intended without exposing domestic manufacturers like Golden Bay to ongoing domestic advantage. A CBAM would apply a carbon charge to imported goods based on the emissions generated during their production. While we're all being, hey look at us, we're being so good and we're saving the Arctic shelves and we're snookering our own companies because we believe in the greater good of the of the planet and the universe, other countries go, yeah, no, not for us. Not really. We don't buy into that whole ETS thing, so we're not going to do it. They can make their goods a whole lot cheaper on so many levels without the ETS even coming into it. Add the ETS on that, the fact that they're ignoring it completely, no wonder their goods are cheaper. So as Fletcher says, why don't we bring in the carbon border adjustment mechanism so wherever it's made in the world, you have to pay your ETS if we're all going to buy into that. How is a one-off payment going to help given the trading environment isn't changing or they've given no indication of the ETS obligations changing anytime soon? And they won't under Labour and Greens, if anything they'd go up. And if Golden Bay is so critical, why isn't Carter Holt Harvey's pulp and paper and plywood? I would have thought that was pretty critical too. Except of course they closed down and it wasn't an election year. Perhaps that's the difference. Last year Carter Holt Harvey saw the closure of Kinleith and Eves Valley sawmill with the loss of hundreds of jobs. We had the closure of Ravensdown, Smithfield, and Ruapehu. Each of these towns and regions could argue that what they made was critical to the supply chain. It was certainly critical to the economic viability of their particular region, which is not awash in situations vacant. Cameron Bagrie has called the bailout of Golden Bay corporate welfareism. Of course it is. Fletcher says it's not, the Government says it's not, but if it's taxpayer money going to an entity that can't support itself, that's welfareism. Nicola Willis might not want to set a precedent, but she has. And a one-off payment is not going to fix the problem, as Fletcher points out. We have signed up to the Paris Accord, we've said, oh yes, bring on the ETS, please let's cripple ourselves so we can maintain the moral high ground. And in the meantime, we're going to have to import goods that are made by other countries that have stuck two fingers to Paris and said we can't afford it. How does that work? How do we maintain the moral high ground by buying goods from countries that are ignoring their carbon offset obligations? We do our own companies out of business, we put people out of work, and we buy from countries that ignore the ETS. It doesn't make any sense to me at all. See omnystudio.com/listener for privacy information.