Economy Grows 0.5 Per Cent

Gross Domestic Product: December 2000 quarter

Economic activity increased by 0.5 per cent in the December 2000 quarter, according to information released today by Statistics New Zealand. This follows a 0.8 per cent increase in the September quarter and a 1.0 per cent fall in the June quarter. For the year ended December 2000, the economy grew 3.4 per cent, down on the 3.9 per cent growth recorded in the previous December year.

While many industries experienced small increases this quarter, the strongest performers were those involved in exports of primary production and inbound tourism. Continuing rises in dairy production and strong export demand for meat products have been the major contributors to increases in agriculture and primary production. Activity in agriculture rose 1.6 per cent this quarter and production is now at the highest level recorded since the current series started in June 1987. Growth in short-term arrivals for the December quarter contributed to increased activity in both hotel and accommodation services, and cultural and recreational services.

Falls in construction and retail trade partially offset these increases, and reflected the more subdued level of internal demand. Construction activity was volatile during the calendar year 2000. The latest fall of 4.2 per cent follows a flat September quarter (up 0.6 per cent), a 16.5 per cent fall in the June quarter, and a 10.1 per cent increase in the March quarter. On an annual basis, construction activity is up 2.9 per cent. Retail trade value added was down 0.3 per cent this quarter, with most storetypes experiencing flat or declining sales. The biggest fall was in furniture and appliance retailing as consumer demand for durables fell.

Brian Pink GOVERNMENT STATISTICIAN

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