Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Election jitters start to impact NZ business confidence

Election jitters start to impact NZ business confidence; Australia closes gap


Election jitters in New Zealand boardrooms and a hard-hitting Australian budget have seen the gap in business confidence levels between the two countries narrow sharply over the last three months.

New Zealand business confidence for the next 12 months has dropped 18%, from 88% in first quarter of this year to 70%, while Australia’s has rebounded from 36% to 50%, according to the Grant Thornton International Business Report (IBR) which surveyed businesses in 34 economies. New Zealand confidence levels have been higher than Australia since 2011.

Mark Hucklesby, Partner and National Technical Director, Audit, for Grant Thornton New Zealand said the shadow of the elections is definitely starting to fall on New Zealand businesses.

“I have been in several boardrooms over the last few weeks where the impact of the elections has been discussed. It’s clear that the offshore customers of many New Zealand businesses are seeking views on the likely outcome of our pending election.

“One thing that these offshore customers want is stability. Even though the National Party has a strong majority, the quirks of MMP leave overseas business leaders with a sense of unease which in turn dents confidence among New Zealand business.

“This survey was conducted before the Reserve Bank’s latest interest rate rise and I suspect this move has probably further eroded confidence levels given its impact on exchange rates,” he said.

Hucklesby said that despite the drop in confidence levels, New Zealand is still ranked sixth in the world, one place lower than last quarter. India (86%), Ireland (84%), United Kingdom (80%), Germany (79%) and the United States (74%) are ahead of us.

“This is still a very good ranking. If you look at the rise in confidence throughout the rest of the world, especially in Australia where business confidence has climbed to its highest level since 2010, then there is no reason to think that the New Zealand economy will not continue to perform strongly.

“The influence of Australia on New Zealand cannot be underestimated. They are still our second biggest trading partner after China and a buoyant economy in Australia is beneficial to New Zealand. Australia’s strong business performance through the Global Financial Crisis and the fact they did not slip into recession was a real positive for this country.

“I firmly believe that the ruthless budget delivered mid-May in Australia helped their business confidence level. They knew that something drastic had to be done and the budget delivered some tough measures. Also, one should not forget that while their budget figures aren’t great, their economy is still ticking over strongly. Good growth figures coming out of India and China have also helped Australia,” he said.
ends

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

R18: The Warehouse Group Praised For Removing Games

The decision by New Zealand’s largest retailer The Warehouse Group (TW Group), to withdraw stocks of the latest version of Grand Theft Auto V (GTA V) and other R18 games, has been praised by advocacy group Stop Demand Foundation. More>>

ALSO:

Air NZ Wine Awards: Victory For Villa Maria As Pinot Noir Thrills

It was a night to remember as Villa Maria Estate picked up one of the highest accolades of the evening, the O-I New Zealand Reserve Wine of the Show Trophy, at the 28th Air New Zealand Wine Awards. The Villa Maria Single Vineyard Southern Clays Marlborough ... More>>

ALSO:

Future Brighter Money: RBNZ Releases New Bank Note Designs

New Zealand’s banknotes are getting brighter and better, with the Reserve Bank today unveiling more vibrant and secure banknote designs which will progressively enter circulation later next year. More>>

ALSO:

Commerce: Supermarket Inquiry Finds No Breaches By Countdown

The Commerce Commission inquiry into anti-competitive behaviour by Countdown supermarkets, alleged by former Labour Party MP Shane Jones, has found nothing to warrant prosecution, although it warns supermarkets to take care in the way they communicate... More>>

ALSO:

Crown Accounts: English Flags ‘Challenge’ To Budget Surplus

Finance Minister Bill English is warning next month’s half yearly fiscal and economic update from the Treasury may not forecast a budget surplus, saying that returning the government’s accounts to surplus in 2015 will be “a challenge”, given the decline in commodity prices and weak global inflation. More>>

ALSO:

March 2015: Netflix To Launch In Australia And New Zealand

World’s Leading Internet Television Network to Offer Original Series, Movies, Documentaries, Stand-Up Comedy Specials and TV Shows for Low Monthly Price More>>

ALSO:

Price Of Cheese (Is Up): Dairy Product Prices Fall To Five-Year Low

Dairy product prices fell in the latest GlobalDairyTrade auction to the lowest level in more than five years, led by declines in rennet casein and skim milk powder. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news