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00:00Can I just grab a long black, please?
00:01In Melbourne, the so-called coffee capital of the world,
00:05lawyer Sean Collier has found a new home.
00:08Thank you so much.
00:09The New Zealander moved to Australia in 2023.
00:12I would say pretty much entirely for economic reasons.
00:15I was working as a lawyer in Auckland for about a year and a half,
00:20and I was essentially living at subsistence level,
00:23pretty much unable to save any money.
00:25Once you get paid, it would just be rent, groceries, gas,
00:31all the money's gone, essentially.
00:33Everyone's got like a different sort of version of events,
00:36but for me at least, I basically doubled my income in less than a year,
00:40and the cost of living went down, so the grass was very much greener.
00:44Collier is part of a growing movement.
00:47About 41,000 New Zealanders moved to Australia in 2025,
00:50the highest level in 12 years,
00:53with more than half of those estimated to be between ages 20 and 39.
00:57And earlier this year,
00:59former Prime Minister Jacinda Ardern joined them,
01:02a move which made international headlines
01:04and shone a light on New Zealand's economy.
01:07There's a bit of a view that our economy isn't performing
01:10quite as well as Australia's economy.
01:12Then you're feeding the narrative that people are starting to hear
01:15at dinner parties that, you know, all of our children are leaving
01:18or the health care services are better or some other kind of thing.
01:22Like Ardern, John Key is also a former Prime Minister of New Zealand,
01:26and before that was Global Head of Foreign Exchange at Merrill Lynch.
01:30The New Zealand economy is not as strong as we'd like it to be,
01:33and maybe not as strong as historically it has been,
01:36but it's not a story of universal lower growth.
01:40Actually, Auckland and Wellington, the main centres, have been weaker,
01:44and largely weaker because of negative house prices.
01:46So that's had a big impact on construction
01:49and all sorts of activity related around housing
01:52and the sort of negative wealth effect of people living in Auckland.
01:56And when you think Auckland is home to 1.5 million people
01:59of a population of about 5 million, it has quite a big impact.
02:03So, yeah, that's been a bit negative.
02:05But the rest of the country have been very strong, actually.
02:08Rural prices have been strong.
02:09So we're a big food producer, basically started life as Britain's little farm,
02:14and we continue to be that.
02:16We're very much a strong food producer.
02:17So that part of the country's been good.
02:20And there's lots of exciting things happening.
02:22Well, New Zealanders have always left for Australia.
02:25The question is whether they come home.
02:27Largely they do, but not always.
02:29I mean, if you look at New Zealand,
02:31we're a home of, say, 5 million people now.
02:34About half a million, maybe as many as a million New Zealanders live in Australia.
02:38So it's quite a few.
02:40We're a little bit like Canada is to the United States.
02:43In the end, the United States is a sort of magnet for talent out of Canada.
02:48Pay packets are higher, opportunities are greater.
02:50It's a little bit like that from New Zealand to Australia.
02:53And every New Zealander has a free option.
02:55So you're free to go to Australia.
02:57It depends on the conditions of how you go, but you are free to go.
03:00So it's a very open labour market.
03:03And there's just no question that those jobs and opportunities are bigger.
03:06And the lifestyle is very similar.
03:11But while New Zealanders have always sought the experience of living overseas,
03:15be it Australia, the UK, or US,
03:18typically they would return home eventually to start a family and buy a house,
03:22often with more wealth and increased expertise from their time overseas.
03:27I've always thought I would raise my kids in NZ.
03:30You know, I've always, like, when I moved here,
03:32the plan was to sort of get a bunch of money together and go home.
03:35And I've spoken to a lot of Kiwis over here,
03:37and that's very much their intention as well.
03:40But to be honest, like, all of the, out of all the Kiwis I know that have moved here,
03:47I couldn't, I couldn't name more than, like, you know, three or four that have actually returned.
03:53So I think, I don't know, it's a, it's a pretty big, it's a pretty big issue.
03:59Like, it's looking less and less realistic for me.
04:03And it's showing up in the numbers.
04:06New Zealand's net citizen migration is at its lowest since official data began in 2001.
04:12In other words, people are leaving like they always did, but now they're no longer coming back.
04:18New Zealand has got a very big productivity problem in that its economy is just muddling through.
04:24Gillian Tett is provost at King's College, Cambridge.
04:26There's a lot of self-inflicted wounds in New Zealand, not least, for example,
04:31the nimbyism that prevents people from building enough houses
04:33to ensure that everyone could get access to a house cheaply and easily.
04:37So you're creating in New Zealand a real intergenerational inequality problem
04:41in that people who are inheriting assets are doing well, others aren't.
04:44So New Zealand's got a lot of problems, and that's one reason why
04:47you've got New Zealanders leaving at the moment.
04:50But in terms of trying to attract smart people and smart talent,
04:54that really is the big new game in town.
04:58New Zealand's problem is not unique.
05:00Poland experienced a brain drain after joining the EU.
05:04Ireland did so in the wake of the great financial crisis.
05:06And Portugal is the latest in Europe.
05:09In all three examples, citizens saw new opportunities for higher pay
05:13and better jobs elsewhere.
05:15But Tett says the loss of intellectual capital isn't always a bad thing.
05:19Is the flow of intellectual capital necessarily a zero-sum game?
05:22I saw a recent report that suggested, actually, both countries could benefit
05:26because people, when they go someplace else, maintain relations back with their home country.
05:32And there can be a flow of capital, of business across the boundaries.
05:37Can it be something that could benefit both countries?
05:39One of the biggest mistakes you will make is to regard intellectual capital as a zero-sum game
05:43and to assume they have to hang on to their brilliant minds at all costs
05:48and stop them from going around the world.
05:50That was a disastrous mistake because history shows very clearly that to get innovation,
05:56you ideally need to have one or two things happening, ideally both at the same time.
05:59On the one hand, you need to have clusters of brilliant minds who can bump into each other,
06:04ideally from different disciplines,
06:06to create that kind of interdisciplinary collisions and creativity.
06:10But you also need to have some diversity and serendipity
06:14that allows people to bump into entirely different ideas
06:17in a way that enables them to be even more creative.
06:19But in terms of people moving around and spending stints of research time
06:26in different intellectual hubs and environments,
06:28it's absolutely crucial if you want to keep ideas flowing
06:32for the benefit of everyone and spark new ones.
06:35And it makes my blood boil when I see governments trying to shut the doors on people,
06:40whether it's the European Union and the UK,
06:43which have not yet implemented a youth mobility scheme.
06:46That makes my heart break, frankly.
06:48The fact that it's become harder to move scientists back and forth across borders,
06:51or not just scientists, but social scientists and humanities scholars as well.
06:55But also what America's doing at the moment is not helpful in terms of sparking
06:59that extraordinary, if you like, you know, chemical mix of brilliant minds coming together.
07:07A healthy flow of intellectual capital may be a good thing for a country,
07:11but it needs to flow in both directions.
07:14Poland provides tax incentives and other support for citizens to return.
07:19Ireland's corporate tax rate attracted foreign direct investment to promote job growth.
07:23And Portugal is looking to stem its brain drain by offering tax exemptions
07:28for a worker's first decade of unemployment.
07:30As politicians and I think even as business leaders,
07:34we feel unclean about any kind of incentive to do something.
07:38And so, I mean, for instance, in my day,
07:40I put up pretty big incentives for movies to be made.
07:43That led to The Hobbits and so many other things happening at Avatar.
07:47And you imagine the skills and technology and capacity that came off that.
07:51But it caused a massive outcry that we were essentially giving back
07:56some of the indirect tax that we got in the form of a subsea,
07:59because we didn't normally do that.
08:01But Ireland's done that.
08:02It's been quite prepared to do that.
08:04I mean, Israel probably has incentives all over the show,
08:06I'm guessing, in the technology space.
08:08So I'm not arguing that we need to go back to a sort of stupid world
08:12where politicians allocate resources and the wrong outcomes come.
08:16I'm just saying I just wonder whether we sort of let perfection get in the way of the possible.
08:22During Key's time in office, HSBC labeled New Zealand a rock star economy,
08:27praise that enhanced its global reputation
08:29and helped the country experience positive net migration with Australia
08:33for the first time in 24 years.
08:35We had political stability.
08:36You know, I was starting to go through Australian prime ministers pretty rapidly.
08:39We'd had one, myself.
08:43And by the end of it, that period of eight years in office,
08:47HSBC described us as a rock star economy.
08:49So people started saying, wow.
08:50And there really are some great opportunities over in New Zealand.
08:53They started coming over.
08:54So it's not an impossible thing to get.
08:58Sadly, what you see is, I mean, in a lot of ways it's a good thing,
09:00but we have a very much an integrated economy with Australia.
09:04So CER, Closer Economic Relations, is our free trade deal.
09:07And it's about the most comprehensive free trade deal you can get.
09:13Extremely comprehensive.
09:14So goods can travel.
09:15Either way, there are no conditions.
09:17Basically, investment can do the same.
09:19So one of the reasons why you see less Australians coming over
09:22is their investment comes into New Zealand,
09:25but then they stay in Australia
09:27and have someone running the operation here,
09:29but they domicile the operation in Australia.
09:32So, look, it's a challenge.
09:34There's no question about that.
09:36But then you've had isolated parts of the country.
09:38Like if you look at, say, Queenstown,
09:40it's had enormous connectivity with Australia,
09:43deemed to be kind of beautiful, the Aspen of the South.
09:46It's attracted an enormous number of migrants,
09:48both from the United States, United Kingdom, but Australia.
09:52And you are seeing positive net migration there.
09:55So it's not every place,
09:58but it's certainly been hard as felt in Auckland
10:02where people have left, I think.
10:05New Zealand's government has also introduced a range of measures,
10:09including active investor visas for wealthy foreigners
10:12and tax incentives for investment.
10:14It's not yet driven the sort of economic opportunities
10:17to attract Kiwis back home.
10:18But for now, Key says New Zealand
10:21should lean into what it's known for.
10:23It can be a little bit negative, but I don't know.
10:27I look at New Zealand and I say,
10:28OK, yeah, I understand all that, but we're five million people.
10:31We really are the last bus stop on the planet,
10:34but we're kind of a paradise as well.
10:36In a world where there's global insecurity,
10:38we seem like a really safe place.
10:41We are incredibly beautiful.
10:44I mean, there's a lot of things going for New Zealand.
10:46So I'm kind of of the view to say,
10:48yeah, we need to acknowledge that the economy needs to be a bit stronger
10:51and create more opportunities, but let's not sort of panic
10:54that all is not fixable, at least in New Zealand,
10:58because I actually believe it is.
11:00In terms of actually fixing these problems,
11:02I think, yeah, like, in a nutshell,
11:05we need to be looking at things
11:06that will actually attract young people back to the country.
11:09I think so many people have left now,
11:10it's not going to be good enough to just stop them leaving.
11:13We actually need to look at things that will bring people back.
11:17And for my generation, like, the main problems are housing,
11:20like, being able to afford property,
11:22being able to have kids, job stability, you know,
11:25AI's ruining job stability for a lot of people.
11:28So I think our government should be looking at ways
11:32to sort of guarantee that if you work hard in New Zealand,
11:35you'll actually be able to have a good quality of life,
11:38which is not the current situation over there.
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