October 22, 2024 • 7 mins
Three big business issues of the week.
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Episode Transcript
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Speaker 1 (00:00):
The Country Sport Breakfast with Brian Kelly on gold Sport.
Oh yeah, is business is business.
Speaker 2 (00:17):
It's time to talk business now with Managing director at
Iron Duke Partners, Phil O'Reilly morning.
Speaker 3 (00:22):
Fill, morning, ba. That's evening here in London where I'm
twenty from. It's it's a cooler shirt autumn afternoon. But lovely,
lovely to be here.
Speaker 2 (00:32):
All right, Well, I won't interrupt your point, but we'll
get into things back home in your hometown, Minister of
Local Governments decided to appoint a Crown observer to Wellington
City Council. Uh do you think that that's deserved?
Speaker 3 (00:48):
Yeah? I think it is. Actually, I mean, the business
community in Wellington had been calling for intervention for some
time and I actually wasn't convinced. I mean, I think
you've got to pass a really high bar to say
to an elected mayor and elected councilor good enough, are
we going to do something about it? But when they
couldn't get over themselves over selling those airports she is
in Wellington, which is my personal view, as I should
have sold them. You know you're going to say, well,
(01:08):
look it's so dysfunctional. Something's got to happen and anybody
who's been to Wellington, and it pains me to say
this because it's a lovely town. It really isn't some trouble.
And the reason I raise it as a business issue
is that it's the business community that's really suffering from
this shop's closing and confidence really down and you know,
the city's really lost its swagger and I think the
(01:29):
you know, that something they needed to change, and I
think the government's right to put an observer and now
I think that's all they needed to do. They didn't
need to remove the council. But hopefully this will mean
that you've got a bit more accountability and business being
listened to a bit more in Wellington. I think that'll
be a very good thing.
Speaker 2 (01:41):
And Tory Finance come out admitting the council must do better,
and I think everybody would agree with that.
Speaker 3 (01:47):
Yeah, I think that's right. I mean, and it's good
for her for saying it. Good to the leaning into
the observer. She had no choice, of course, but you
make I'm being positive out of it. But once again
she's saying in the media, Look, you know, if only
would agree with me is the mayor. We've got to
be fine. Well, actually that's not. It's them tissue, come on.
(02:08):
But I hope her left leg on the council will
do a bit of that now that the SHOT's been
fired across the abow But two days we'll see your
actions are that far along, all.
Speaker 2 (02:18):
Right, Phil? Our chances that the Reserve Bank will drop
the official cash rate by a further seventy five basis
points at their next meeting in a couple of weeks time,
is that a good call? Is?
Speaker 3 (02:33):
Of course, the Reserve Bank grows too high, too fast,
and keep them up there to the too long. You
and I have been talking over the last few months
about the fact that although headline inflation was quite high,
actually the real economy was on the carpet. This is
maybe a year ago actually, and so you're still still
quite high headline inflation, but a lot of that was
what we call non trader of inflation, things like council rates,
(02:54):
just having spoken about what in city council were their
huge race rises, and so what you saw was the
real economy really hurting for quite a while before the
RB started to reduce last time around. And the fact
that they're reducing so fast and so and so heavily
does demonstrate, I think, but they overdid it, and I think,
you know, they need to be called to account and
demonstrate that they've now got it right in terms of
(03:16):
they go forward. So I think now my sense is
the New Zealand economy, in New Zealand, businesses and households
and consumers, it did worse than they might have otherwise
done if the Reserve Bank have played a more conservative
game about putting those rates rises up and then looked
at the real economy as they as they reduced them.
But you know, better late than never. Let's hope that
we get a bit of confidence back in the business community.
(03:36):
We've got high confidence. Now we need some spending from
those consumers and some business investment as well. Hopefully that
will happen before Christmas and we'll see the economy start
to pick up again.
Speaker 2 (03:47):
Absolutely. Latest data telling us that fruit exports are going well,
particularly into Europe. So what's happening there? Fil Can it last?
Speaker 3 (03:57):
That's a great well, it won't last because it's seasonal,
but it's a great story. There is no one of
to raise with. It's such a positive story to end
on this week, this is Kiwi Freud exports, particularly into
Europe up by you know, a big number, one hundred
and thirty million. I think it was in the in
the Foreca in the period of the survey. And of
course what we're seeing is imports to New Zealand still
low because as we and I've discussed previously, nobody wants
(04:18):
to buy a television and nobody wants to buy a car,
so New Zealand are actually pretty subdued. Hopefully those interest
rate rezes will mean that consumers start spinning again and
you'll see some of those imports rise in the next
quarter or two. But in the meantime you're seeing great
success from Kiwi fruit, for example, and to Europe. Now
I've just come in Europe right now, but I've just
(04:38):
come from from the EU area of Europe over the
last few days, and what's clear is that Ziesber is
doing a great job in that market. They've got great
branded Kiwi fruit. It's everywhere you can buiny in any
sever market. Basically you've see in all the restaurants, and
they've got good partnerships, good licensing partnerships with the likes
of Italian growers who can grow the Kiwi fruit. The
(04:59):
cult of VARs Q through gold and so on in
the off season. So you know you've got this ongoing
capacity to buy kivy fruit in the supermarket and in
your restaurant, and that's a very good outcome. So it
just demonstrates to me a success story in terms of
what Zespri's trying to do in terms of building valuable
exports intermarket supported by IP agreements and distribution agreements with others.
(05:21):
So long mat continue, you'll see that export growth level
off of it as the season finishes. But you know,
the Italians will pick it up as we as we
come into the off season for US, and you'll still
be able to buy it in Europe and that will
still be income to farmers because of the IP agreements
that have been done between New Zealand and Europe in
that regard. So a great success story and I certainly
saw it firsthand as I was in Europe over the
(05:43):
last week or two.
Speaker 2 (05:44):
That's nice and positive. And before I let you go,
I know you love your Formula one. You would have
been totally impressed by Liam Lawson's performance the US Grand
Prix last weekend.
Speaker 3 (05:54):
Well, I was in London. I just tell your listeners
and I was. I was trying to find a pub
that might might broadcast and I found a huge sports
bar called Greenwood at Victoria Station. Of any of your
listeners are going to London, want to watch some sport,
go there. And it was on about forty screens with
about two thousand people watching it, all drinking beer, and
(06:14):
I was screaming louder than most. Obviously they were all
supporting Lewis Hamilton and the British drivers, but you know,
it was just great to see it and great to
see it happen on that global stage, and then great
to see what Christian Horner and Red Bull have said
about him afterwards. And I think he really it really
sets him up, I think for a bright future. So
I really hope we'll see a great Formula one driver
and some other safefully coming through with the Lakes of
(06:37):
Louis Sharp and a few others who are just bubbling
up there as being really promising drivers. The birth of
these new young guns and Formula one, it's just fantastic
to see and really inspirational to see a key with
there was just it was a heartwarming moment. I must say,
to stand in a pub in London makes the whole
bunch of bombs and see it happened.
Speaker 2 (06:54):
Yeah, absolutely, Hayfel, safe travels and we'll talk again next week.
Speaker 3 (06:59):
Thanks b K Fellow.
Speaker 2 (07:00):
O'Reilly Managing director of Iron Duke Partners. Here there's there's
nothing like it being over in the UK when there's
some top sport on and Kiwis are involved
The Country Sport Breakfast with Brian Kelly on gold Sport.
Oh yeah, is business is business.
Speaker 2 (00:17):
It's time to talk business now with Managing director at
Iron Duke Partners, Phil O'Reilly morning.
Speaker 3 (00:22):
Fill, morning, ba. That's evening here in London where I'm
twenty from. It's it's a cooler shirt autumn afternoon. But lovely,
lovely to be here.
Speaker 2 (00:32):
All right, Well, I won't interrupt your point, but we'll
get into things back home in your hometown, Minister of
Local Governments decided to appoint a Crown observer to Wellington
City Council. Uh do you think that that's deserved?
Speaker 3 (00:48):
Yeah? I think it is. Actually, I mean, the business
community in Wellington had been calling for intervention for some
time and I actually wasn't convinced. I mean, I think
you've got to pass a really high bar to say
to an elected mayor and elected councilor good enough, are
we going to do something about it? But when they
couldn't get over themselves over selling those airports she is
in Wellington, which is my personal view, as I should
have sold them. You know you're going to say, well,
(01:08):
look it's so dysfunctional. Something's got to happen and anybody
who's been to Wellington, and it pains me to say
this because it's a lovely town. It really isn't some trouble.
And the reason I raise it as a business issue
is that it's the business community that's really suffering from
this shop's closing and confidence really down and you know,
the city's really lost its swagger and I think the
(01:29):
you know, that something they needed to change, and I
think the government's right to put an observer and now
I think that's all they needed to do. They didn't
need to remove the council. But hopefully this will mean
that you've got a bit more accountability and business being
listened to a bit more in Wellington. I think that'll
be a very good thing.
Speaker 2 (01:41):
And Tory Finance come out admitting the council must do better,
and I think everybody would agree with that.
Speaker 3 (01:47):
Yeah, I think that's right. I mean, and it's good
for her for saying it. Good to the leaning into
the observer. She had no choice, of course, but you
make I'm being positive out of it. But once again
she's saying in the media, Look, you know, if only
would agree with me is the mayor. We've got to
be fine. Well, actually that's not. It's them tissue, come on.
(02:08):
But I hope her left leg on the council will
do a bit of that now that the SHOT's been
fired across the abow But two days we'll see your
actions are that far along, all.
Speaker 2 (02:18):
Right, Phil? Our chances that the Reserve Bank will drop
the official cash rate by a further seventy five basis
points at their next meeting in a couple of weeks time,
is that a good call? Is?
Speaker 3 (02:33):
Of course, the Reserve Bank grows too high, too fast,
and keep them up there to the too long. You
and I have been talking over the last few months
about the fact that although headline inflation was quite high,
actually the real economy was on the carpet. This is
maybe a year ago actually, and so you're still still
quite high headline inflation, but a lot of that was
what we call non trader of inflation, things like council rates,
(02:54):
just having spoken about what in city council were their
huge race rises, and so what you saw was the
real economy really hurting for quite a while before the
RB started to reduce last time around. And the fact
that they're reducing so fast and so and so heavily
does demonstrate, I think, but they overdid it, and I think,
you know, they need to be called to account and
demonstrate that they've now got it right in terms of
(03:16):
they go forward. So I think now my sense is
the New Zealand economy, in New Zealand, businesses and households
and consumers, it did worse than they might have otherwise
done if the Reserve Bank have played a more conservative
game about putting those rates rises up and then looked
at the real economy as they as they reduced them.
But you know, better late than never. Let's hope that
we get a bit of confidence back in the business community.
(03:36):
We've got high confidence. Now we need some spending from
those consumers and some business investment as well. Hopefully that
will happen before Christmas and we'll see the economy start
to pick up again.
Speaker 2 (03:47):
Absolutely. Latest data telling us that fruit exports are going well,
particularly into Europe. So what's happening there? Fil Can it last?
Speaker 3 (03:57):
That's a great well, it won't last because it's seasonal,
but it's a great story. There is no one of
to raise with. It's such a positive story to end
on this week, this is Kiwi Freud exports, particularly into
Europe up by you know, a big number, one hundred
and thirty million. I think it was in the in
the Foreca in the period of the survey. And of
course what we're seeing is imports to New Zealand still
low because as we and I've discussed previously, nobody wants
(04:18):
to buy a television and nobody wants to buy a car,
so New Zealand are actually pretty subdued. Hopefully those interest
rate rezes will mean that consumers start spinning again and
you'll see some of those imports rise in the next
quarter or two. But in the meantime you're seeing great
success from Kiwi fruit, for example, and to Europe. Now
I've just come in Europe right now, but I've just
(04:38):
come from from the EU area of Europe over the
last few days, and what's clear is that Ziesber is
doing a great job in that market. They've got great
branded Kiwi fruit. It's everywhere you can buiny in any
sever market. Basically you've see in all the restaurants, and
they've got good partnerships, good licensing partnerships with the likes
of Italian growers who can grow the Kiwi fruit. The
(04:59):
cult of VARs Q through gold and so on in
the off season. So you know you've got this ongoing
capacity to buy kivy fruit in the supermarket and in
your restaurant, and that's a very good outcome. So it
just demonstrates to me a success story in terms of
what Zespri's trying to do in terms of building valuable
exports intermarket supported by IP agreements and distribution agreements with others.
(05:21):
So long mat continue, you'll see that export growth level
off of it as the season finishes. But you know,
the Italians will pick it up as we as we
come into the off season for US, and you'll still
be able to buy it in Europe and that will
still be income to farmers because of the IP agreements
that have been done between New Zealand and Europe in
that regard. So a great success story and I certainly
saw it firsthand as I was in Europe over the
(05:43):
last week or two.
Speaker 2 (05:44):
That's nice and positive. And before I let you go,
I know you love your Formula one. You would have
been totally impressed by Liam Lawson's performance the US Grand
Prix last weekend.
Speaker 3 (05:54):
Well, I was in London. I just tell your listeners
and I was. I was trying to find a pub
that might might broadcast and I found a huge sports
bar called Greenwood at Victoria Station. Of any of your
listeners are going to London, want to watch some sport,
go there. And it was on about forty screens with
about two thousand people watching it, all drinking beer, and
(06:14):
I was screaming louder than most. Obviously they were all
supporting Lewis Hamilton and the British drivers, but you know,
it was just great to see it and great to
see it happen on that global stage, and then great
to see what Christian Horner and Red Bull have said
about him afterwards. And I think he really it really
sets him up, I think for a bright future. So
I really hope we'll see a great Formula one driver
and some other safefully coming through with the Lakes of
(06:37):
Louis Sharp and a few others who are just bubbling
up there as being really promising drivers. The birth of
these new young guns and Formula one, it's just fantastic
to see and really inspirational to see a key with
there was just it was a heartwarming moment. I must say,
to stand in a pub in London makes the whole
bunch of bombs and see it happened.
Speaker 2 (06:54):
Yeah, absolutely, Hayfel, safe travels and we'll talk again next week.
Speaker 3 (06:59):
Thanks b K Fellow.
Speaker 2 (07:00):
O'Reilly Managing director of Iron Duke Partners. Here there's there's
nothing like it being over in the UK when there's
some top sport on and Kiwis are involved
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