Manufactured Exports Break $12 billion Mark
“New Zealand manufacturers have cause to celebrate,” said Simon Carlaw, Chief Executive of the New Zealand Manufacturers Federation. “Despite the uncertainty over last year about interest rates and the possible outcome of some Government policies the manufacturing sector still went on to set a number of significant export records in the year ended December 2000. The fundamental soundness of the sector and the significance of its contribution to the economy has never been more evident, said Mr Carlaw.
He was commenting on the latest export data from Statistics New Zealand which confirms that manufactured exports well and truly broke the $12 billion mark in 2000. Provisional manufactured exports for the calendar year were $12,436 million.
“It was only March last year that the sector passed the $10 billion mark. So overtaking the $12 billion in the same year is quite an achievement and reflects the significant and growing contribution made by manufacturing to the health of New Zealand’s economy. Manufactured exports, excluding basic processed products such as dairy, meat and fish products, scoured wool, wood pulp and pickled pelts), now contribute 45% of total export returns.
“Total manufactured export growth achieved for the year was $2,812 million, an increase of 29% on 1999. This is well up on the previous record for annual growth in 1995 when growth of $1,083 million (15%) was recorded.
“Manufactured commodity exports (sawn timber, panel products, newsprint, methanol and aluminium) contributed much of the growth earlier in the year, reaching the $4 billion mark in December which reflected an annual growth of 44%.
“Exports of Elaborately Transformed Manufactures (ETMs), however, accelerated in the second half of the year breaking the $8 billion mark with a $1,594 million (23%) increase over 1999.
“An even more remarkable result for ETM exports is the growth the sector has achieved over the past decade. In 1990 ETM exports were $3,083 million, or 20% of total export earnings. By 2000 they have grown to $8,450 million, an increase of $5,300 (174%) over the decade. Their contribution to total exports is now 30%.
“A significant contributor to the strong growth in ETM exports has been the rapid expansion of the broad fabricated metals sector. The sector encompasses electrical and electronic products, industrial and agricultural machinery, metal products and transport equipment (automotive components and boats). Its exports grew from just $918 million in 1990 to $2,848 by 2000.
“A further important change over the past year has been the reduced dependence on the Australian economy. In December 2000 Australia took only 33.7% of New Zealand’s manufactured exports, well down on the 38.7% share in 1999. By comparison in the mid 1990s Australia's share was as high as 44% of New Zealand’s manufactured exports.
“Strong competition from Asia for the Australian market, the weak Australian dollar and the recent downturn in the Australian economy have all been factors in the weak export growth to Australia
“In contrast, strong growth was recorded to a number of trading partners in North America and Asia. Exports to the US, for example, increased by 48%, Japan was up by 58%, while China 49% and Korea were up 42%. We should continue to see more diversification away from Australia into Asia, particularly the strongly growing market in China.
“While economic growth in some of these economies is slowing, New Zealand manufacturers are still confident they will continue to gain new market share in 2001. Improved competitiveness provided by the exchange rate will be a significant factor in this confidence.”