The Green Party is proposing to print more money in order to bring down the value of the New Zealand dollar.
The kiwi rose to 82.41 US cents at the end of the week and its increasing strength against the greenback is causing concern for exporters.
Green Party co-leader Russel Norman said the pressure is causing the loss of thousands of jobs and greater migration to Australia.
"The National Government promised a rebalancing of the New Zealand economy. Instead, under their watch, the New Zealand dollar has reached record high levels, tens-of-thousands of jobs have been lost in the manufacturing sector, the current account deficit is widening, and overseas debt is increasing," he said.
"Since the Global Financial Crisis, our major trading partners have engaged in large scale measures that have devalued their currencies. Our productive sector has been the first casualty and, along with it, any chance of securing our long-term prosperity."
The party has outlined three measures it believes will enhance the country's economy.
- A broader mandate for the Reserve Bank to enable a lower Official Cash Rate (OCR) and new tools for managing asset bubbles.
- A comprehensive capital gains tax (excluding the family home)
- Quantitative Easing (QE) in the form of the Reserve Bank purchasing Government earthquake recovery bonds to pay for the government's costs in the rebuild of Christchurch and, separately, refilling the Natural Disaster Fund.
Norman said adopting Quantitative Easing in New Zealand would bring an immediate downward impact on the exchange rate.
"Buying Christchurch earthquake recovery bonds will reduce the need for the Government to borrow offshore. Currently, about 60% of all Government borrowing is from offshore," he said.
"Buying overseas assets to restore the EQC's Natural Disaster Fund will prepare us better for any future natural disasters."
Norman said the measures would make the kiwi less attractive to currency speculators and improve the prospects for the country's exporters.
The proposals have been welcomed by FIRST Union which says the current monetary policy is broken.
"Sitting on our hands and doing nothing about the high New Zealand dollar is not an option," said Robert Reid, FIRST Union General Secretary.
"There will be plenty of views on how to deal with the high dollar, but shirking away from a meaningful debate on alternative monetary policy settings that support jobs in manufacturing is not good enough."
However, the Minister for Economic Development, Steven Joyce, has dismissed the plans as a "grab-bag of theories" which shows the Green Party has little grasp of the economy.
"New Zealand has one of the strongest economies in the OECD over the last 12 months, and yet the Greens are determined to talk us down and promote a bunch of ideas that are only in vogue in countries that have run out of options and have massive and crippling public debt," Joyce said.
"They have truly jumped the shark. The Greens half-baked economic ideas would move one of the few solidly growing OECD economies into the basket case division - more proof that they should never be let near the Treasury benches."
Joyce said New Zealand is doing better than most countries in the wake of the global financial crisis, with the economy growing by 2.6% since last year and 57,000 jobs added over the last two years.