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


NZ faces long, slow recovery, says Bollard

NZ faces long, slow recovery, says Bollard

Nov. 19 (BusinessDesk) – New Zealand’s economic recovery is progressing “very slowly” and “could yet be a prolonged process,” says the Governor of the Reserve Bank of New Zealand, Alan Bollard.

While the medium-term outlook looks favourable, the large Budget deficit needs reining in and will “subtract from growth for a number of years,” Bollard told a Deloitte tax conference in Auckland.

This would contribute to a weak housing market, “impaired” levels of consumption and private demand, fragile balance sheets, and cautious businesses.

Developed world economies struggling with their own massive fiscal stimulus hangover would grow slowly too, but on the bright side, Australia, China and large, energy-rich developing economies including Russia and Brazil, were growing strongly, while South Africa and Latin American economies were enjoying export-led growth.

The strength of the Chinese and Indian economies “will benefit New Zealand indirectly over and above our direct trade exposure,” Bollard said.

“Emerging markets develop significant middle classes, there is a commensurate increase in demand for protein, increasingly animal-based, and food market analysis by Japanese firm Nomura predicts that “real food prices will need to rise significantly” in response to growing demand.

While New Zealand is not a huge food producer by global standards, its food exports as a percentage of total economic activity places it “top of the world,” said Bollard. “We are the best placed in competitive terms in Nomura’s food vulnerability index.

“Food trade is volatile in the short term, but these trends are very positive for New Zealand’s terms of trade, which have picked up significantly over the last decade.”

Growth in Australia, stoked by “reasonably sustainable” growth in China was a further important pressure on New Zealand’s performance.

The Australian minerals boom and strong currency were driving “strong demand for food and manufacturing exports from a more competitive New Zealand. We are a primary product supplier to Asia, but we need to see ourselves also as a post-primary supplier to Australia,” said Bollard.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Westpac: Sets Out Plan To Go Cheque-Free

Westpac NZ has announced details of its plan to phase out cheques, after signalling in May that it would be supporting a move to other forms of payment. Cheques will cease to be available as a means of payment after 25 June 2021. Westpac NZ General ... More>>


NZTA: Major New Zealand Upgrade Programme Projects Go To Tender

Two major New Zealand Upgrade Programme projects are beginning tenders for construction. The New Zealand Upgrade Programme is a $6.8 billion investment to get our cities moving, to save lives and boost productivity in growth areas. The first Auckland ... More>>

Reserve Bank: RBNZ Seeks To Preserve Benefits Of Cash

The Reserve Bank – Te Pūtea Matua is taking on a new role of steward of the cash system “to preserve the benefits of cash for all who need them”, Assistant Governor Christian Hawkesby told the Royal Numismatics Society of New Zealand annual conference ... More>>


Economy: Double-Dip Recession Next Year, But Housing Rolls On

New Zealand's economy is expected to slip back into recession early next year as delayed job losses, falling consumer spending, and the absence of international tourists bites into growth. More>>


Microsoft New Zealand: Microsoft Expands “Highway To A Hundred Unicorns” Initiative To Support Startups In Asia Pacific

New Zealand, 14 October 2020 – Today Microsoft for Startups launches the Highway to a Hundred Unicorns initiative in Asia Pacific to strengthen the region’s startup ecosystem. This follows the initiative’s success in India, where 56 startups were ... More>>

Fonterra: Farmers Taking Another Step Towards New Zealand’s Low Emissions Food Production

They’re hot off the press and intended to help take the heat out of climate change. Fonterra farmers are already among the world’s most sustainable producers of milk and now have an additional tool in their sustainability toolbox. Over the last few ... More>>


Courts: Businessman Eric Watson Sentenced To A Four-Month Jail Term

New Zealand businessman Eric Watson has been sentenced to a four-month jail term in the UK for contempt of court, TVNZ reports. More>>

OECD: Area Employment Rate Falls By 4.0 Percentage Points, To 64.6% In Second Quarter Of 2020

The OECD area employment rate – the share of the working-age population with jobs – fell by 4.0 percentage points, to 64.6%, in the second quarter of 2020, its lowest level since the fourth quarter of 2010. Across the OECD area, 560 million persons ... More>>

Spark: Turns On 5G In Auckland And Offers A Glimpse Into The Future Of Smart Cities

Spark turned on 5G in downtown Auckland today and has partnered with Auckland Transport (AT) to showcase some of the latest in IoT (Internet of Things) technology and demonstrate what the future could look like for Auckland’s CBD with the power of 5G. 5G is ... More>>

Stats NZ: Monthly Migration Remains Low

Since the border closed in late-March 2020, net migration has averaged about 300 a month, Stats NZ said today. In the five months from April to August 2020, overall net migration was provisionally estimated at 1,700. This was made up of a net gain ... More>>

University of Canterbury: Proglacial Lakes Are Accelerating Glacier Ice Loss

Lake Tasman, New Zealand | 2016 | Photo: Dr Jenna Sutherland Meltwater lakes that form at glacier margins cause ice to recede much further and faster compared to glaciers that terminate on land, according to a new study. But the effects of these glacial ... More>>


Dairy: Fonterra Sells China Farms

Fonterra has agreed to sell its China farms for a total of $555 million (RMB 2.5 billion*1), after successfully developing the farms alongside local partners. Inner Mongolia Natural Dairy Co., Ltd, a subsidiary of China Youran Dairy Group Limited ... More>>