GDP underlines importance of economic focus

Hon Steven Joyce
Minister of Finance

15 June 

GDP figures out this morning are a reminder of the importance of focusing on policies that create and sustain economic growth, Finance Minister Steven Joyce says.

New Zealand's GDP grew a slightly lower than expected 0.5 per cent in the March quarter, taking New Zealand's growth rate for the year to 3.0 per cent.

"Moderate GDP growth over the last six months is a reminder that every economic gain is hard-won in what is still a challenging international environment,” Mr Joyce says.

"This is not the time to rest on our laurels and start considering policies that would damage growth in key sectors or across the economy."

Growth in the quarter was across 11 of 16 industries, including:

  • Agriculture, forestry and fishing (up 2.8 per cent)
  •  Manufacturing (up 1.0 per cent)
  • Retail, trade and accommodation (up 1.8 per cent)
  • Healthcare and residential care (up 1.6 per cent)

These were partially offset by weaker growth in the transport and construction sectors.

“Construction fell in the quarter, by 2.1 per cent, but the annual construction figure increased by 9.3 per cent for the year ending March 2017,” Mr Joyce says. “These figures move around from quarter to quarter, but we remain in one of the biggest building booms New Zealand has ever seen.”

Today’s GDP figures followed on from the release of New Zealand's external accounts for the March year yesterday, which showed a current account deficit of 3.1 per cent, which is the same as the March 2016 year.

"The international liability position – a measure of our indebtedness to the rest of the world – is down again to 58.5 per cent of GDP, compared to over 80 per cent when the current government came into office," Mr Joyce says.

"The improving external accounts show the benefit of a strong economic plan that delivers steadily improving economic results relative to the rest of the developed world.

"The Government will continue to take the right steps to encourage businesses to invest and grow more jobs for New Zealanders."