(Bloomberg) -- New Zealand’s next prime minister will have big shoes to fill after the shock departure of John Key.
A politician with an uncanny ability to read the public mood, Key’s broad popularity has been the driving force behind the success of his National Party-led government. While his deputy, Finance Minister Bill English, is the leading candidate to succeed him, there’s no guarantee he would take the party to a fourth straight election victory in 2017 or remain at the helm for the long term.
“He’s seen as a bit bland and boring, which is fine for a minister of finance because you want someone with stability and a bit more of a conservative look,” said Bryce Edwards, a political scientist at University of Otago. “He’s going to need something different as prime minister, and I’m not sure he has that same charisma or colorfulness as John Key.”
With the economy growing at a healthy clip and Key as popular as ever in opinion polls, National was looking a good bet for a fourth term. Key’s surprise resignation Monday, less than a year out from the election, has given the main opposition Labour Party renewed hope.
Labour’s 28 percent support in the most recent poll compares with 50 percent for National, but New Zealand’s electoral system is conducive to coalition governments and even a small swing can unseat the incumbent. Labour will partner with the Greens, who are on 11 percent support, while the maverick New Zealand First party on 10 percent could also align against National.
Add to that the appetite for change sweeping the globe, as evidenced by the U.K.’s vote to leave the European Union and Donald Trump’s victory in the U.S. presidential election, and Labour leader Andrew Little was quick to talk up his chances.
“I think next year’s general election is going to be bloody interesting,” Little told Sky News. While the economy was doing well and National was riding high in the polls, “the truth is there are some real challenges for New Zealand,” he said.
New Zealand stocks fell and the local dollar shed almost half a U.S. cent on Key’s unexpected announcement. The currency later recouped its losses.
Key cited family reasons and a need to refresh National’s leadership for his resignation. He will step down on Dec. 12, when the party’s members of parliament will vote on his replacement. Key anointed English as his most qualified heir.
“I have witnessed first-hand his leadership style, his capacity for work, his grasp of the economy, his commitment to change and most of all his decency as a husband, as a father, a colleague and as a politician,” Key said.
English, 54, said Tuesday he will seek the leadership. It won’t be an uncontested succession after Health Minister Jonathan Coleman and Police Minister Judith Collins also said they’re throwing their hats into the ring.
English has led the party before, taking it to its worst election defeat in 2002 while in opposition. However, since becoming Key’s deputy in 2006 and finance minister in 2008, English, a father of six and a former farmer, has developed a reputation as a safe pair of hands.
He will present a half-year budget update on Dec. 8, which is expected to show rising surpluses and a solid economic outlook.
“English has been the thinking man behind National’s success and the real anchor of its policy,” said Craig Ebert, senior economist at Bank of New Zealand in Wellington. “The problem is he is not the front man that Key is. The next political polls will be very interesting, as will the next business confidence surveys.”
With economic growth of 3.6 percent in the year through June, New Zealand is among the fastest-growing nations in the developed world, leaving National well placed to fight next year’s election on its promise of tax cuts.
However, the South Pacific nation of 4.7 million people is also in the grip of a housing boom that’s seen prices in largest city Auckland almost double over the past nine years, locking many first-home buyers out of the market and forcing others to take on huge amounts of debt.
Key said yesterday he believes National will win next year’s election, and distanced the party’s success from his personal brand.
“People have seen what the government has delivered, and I think in the end people vote on issues that really matter,” he said. “The new leader will have a different style from me. That’s a healthy thing. That’s potentially how we get a fourth term, or maybe even a fifth.”