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

 

Auckland Transport Case: Men Guilty Of Corruption And Bribery Will Spend Time In Jail

Two men who were found guilty of corruption and bribery in a Serious Fraud Office (SFO) trial have been sentenced in the Auckland High Court today... The pair are guilty of corruption and bribery offences relating to more than $1 million of bribes which took place between 2005 and 2013 at Rodney District Council and Auckland Transport. More>>

ALSO:

Hager Raid: Westpac Wrong To Release Bank Records To Police

The Privacy Commissioner has censured Westpac Banking Corp for releasing without a court order more than 10 months of bank records belonging to the political activist and journalist Nicky Hager during a police investigation into leaked information published in Hager's 2014 pre-election book, 'Dirty Politics'. More>>

ALSO:

EARLIER:

Crown Accounts: Government Ekes Out Six-Month Surplus Of $9M

The New Zealand government eked out a tiny surplus in the first six months of the fiscal year as growth in domestic consumption lifted the goods and services tax take, while uncertainties over the Kaikoura earthquake costs meant expenses were less than expected. More>>

ALSO:

Almost 400 Jobs: Shock At Cadbury's Dunedin Factory Closure

Workers at Cadbury in Dunedin are reeling after learning this morning that the iconic Cadbury factory is to close, with the loss of almost 400 jobs... “The company had reported it was doing well and this has come out of the blue,” says Chas. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news