Ryan Bridge: NZ's isolation is a blessing and a curse

It'd be easy to draw comparisons and parallels between our upcoming election and the local and federal upsets in Australia and the UK at the weekend. 

But New Zealand is a totally different kettle of fish. In part, because, unlike the Brits and the Aussies, we run an MMP system. 

The smaller parties that have traditionally been overlooked, like One Nation and Reform, are doing well because the major parties have failed on immigration and the economy. 

Our system is designed to allow these smaller parties more say, with fewer wasted votes.

But most importantly, mass-migration is not the hot-button political issue here it is in the UK and, to a lesser extent, Australia, where migration, and particularly illegal migration, is a problem.

The vast distance you must travel to get here is our saving grace, in that regard. 

But our isolation is also a curse in many ways. 

Our labour productivity, low population base and lack of competition in key consumer sectors make us a relatively pricey place to raise a family. 

We're an open economy heavily reliant on international trade. 

So when there's a tariff war or international shipping routes get blocked, we are disproportionately affected compared to bigger economies with more domestic demand and buying power. 

A government report looking at our undersea infrastructure cables - power and internet - shows how vulnerable we are - 99% of our international internet goes undersea. The Cook Strait power cable provides up to 30% of the North Island’s electricity. 

If the Russians or Chinese or somebody else tried to cut us off, we'd be in trouble, and our isolation makes replacing these things more difficult than others. 

A quarantine or blockade of Taiwan would be the worst-case scenario for our trade-flows. And, as we've been talking about for years now, could happen anytime from 2027 onwards. 

Our isolation protects us from the threats faced by the UK , America and the Aussies, but exposes unique ones we should guard against. 

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Episode Transcript

Speaker 1 (00:00):
It'd be easy, I think, to draw comparisons or parallels
between our upcoming election and the local and federal upsets
in Australia were in the UK at the weekend. But
New Zealand is a totally different kettle of fish, in
part because, unlike the Brits and the Aussies, we run
an MMP system. The smaller parties that have traditionally been overlooked,
like One Nation in Australia and Reform in the UK,

(00:23):
are doing well because the major parties have failed on
immigration in the economy. Our system here is designed to
allow these smaller parties more say, therefore fuel wasted votes.
But most importantly, mass migration is not the hot button
political issue here that it is in the UK and
to a less extent Australia, where migration, particularly a legal migration,

(00:46):
big problem. Right the vast distance that you have to
travel to get here is basically our saving grace, but
our isolation is also a curse in many ways. Our
labor productivity, low population based, lack of COMPI and key
consumer sectors thick groceries make us a relatively pricey place
to raise a family, which is a bit of an

(01:07):
issue We're an open economy, we are heavily reliant on
international trade, so when there's a tariff war or international
shipping routes get blocked and jammed up, we are disproportionately
affected compared to our bigger economies, our friends overseas, where
they've got more domestic demand, more buying power, etc. A
government report looking at our undersea infrastructure cables has come out,

(01:31):
Power and Internet shows just how vulnerable we are because
of the distance. Ninety nine percent of our international Internet
goes under sea, and the Cook Straight Power cable provides
up to thirty percent of the North Island's electricity. If
the Russians, or the Chinese or somebody else tried to
cut us off, we would be in big trouble, and
our isolation makes replacing these things more difficult than other countries.

(01:57):
A quarantine or a blockade of Taiwan would be the
worst case scenario for our trade flows, and, as we've
been talking about for years now, could happen anytime from
twenty twenty seven onwards. Our isolation protects US from the
threats faced by the UK, America and to a lesser
extent than Aussies, but exposes unique ones that we should

(02:19):
be king to guard against. For more from Early Edition
with Ryan Bridge, listen live to News Talk Set B
from five am weekdays, or follow the podcast on iHeartRadio