Finance Minister Michael Cullen said today that the annual current account deficit for the year ended last December, at 3.2 percent of GDP, was the strongest result recorded since March 1992.

“The quarterly figure was a little below but still broadly in line with market expectations,” Dr Cullen said.

He said the recent bounce back in tourism numbers should take some pressure off the BoP moving forwards although the deficit was expected to increase somewhat as lower export prices, particularly in the dairy sector, impacted on export receipts and as a strong domestic economy pushed up the demand for imports.

“To improve our current account position over the long term we have to strengthen our export base through a mix of international trade liberalisation, foreign direct investment, skills improvement and innovation.

“The government has a detailed and developing strategy to address all those objectives and to raise New Zealand’s sustainable growth rate over time,” Dr Cullen said.

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