For our economic recovery to continue and based on exporting many of manufacturing exporters will need to diversify into markets beyond Australia, says Kim Campbell, chief executive of the Employers and Manufacturers Association.

 “Times are tougher than for many years in Australia, our biggest market for manufactured goods, and the climbing trans Tasman cross rate is cutting into margins,” Mr Campbell said.

“Early this year people were panicking over the high US dollar and the Australian dollar was low; now the position has reversed with a 10 per cent switchover for each currency.

“In fact the change is already taking a toll with manufactured exports to Australia down 4 per cent for the 12 months ended June 2013 to $6.1billion, excluding dairy, meat and wood pulp.

 “Some years ago we were planning a parity party with Australia, followed most recently by several years of the most favourable trans Tasman cross rate ever. Currencies fluctuate.

“The answer to managing currency volatility is to diversify into new markets and invest in productivity gains through better equipment, skills development and innovation.

“A longer term solution in our own hands would be to increase our savings rate which would mean not having to rely so much on overseas capital to fund our voracious appetite for housing.”