NZ growth ranked as one of the strongest

October 10th, 2013 at 1:00 pm by David Farrar

Brian Fallow at NZ Herald reports:

New Zealand will rank among the strongest-growing of the advanced economies this year and next year, according to the International Monetary Fund’s annual World Economic Outlook.

It forecasts New Zealand’s growth rate this year to be 2.5 per cent, bettered among the 35 advanced economies only by Israel, Singapore, Hong Kong and Korea. The average for advanced economies in 2013 is just 1.2 per cent.

4th in the developed world isn’t bad.

New Zealand also looked relatively good on the fiscal front, with a general government deficit of 0.4 per cent of gross domestic product over 2014, compared with an average deficit of 3.5 per cent for the advanced economies as a whole.

That will change if the Government changes.

Next year’s unemployment rate of 5.3 per cent was not as bad as the 12.2 per cent projected for the euro area, 7.4 per cent for the United States or even Australia’s 6 per cent.

Still too high, but if under Australia that is good.

But the failing grade on the report card was the current account balance: a bottom-of-the-class deficit of 4.2 per cent of GDP this year and next year, worsening to 6.1 per cent by 2018.

The current account deficit is a challenge, but it is less important that the fiscal deficit.

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30 Responses to “NZ growth ranked as one of the strongest”

  1. Psycho Milt (2,427 comments) says:

    That will change if the Government changes.

    You mean, a different government would cancel the Christchurch rebuild? I presume that’s what you’re saying, given that those impressive growth figures are almost all down to Chch rebuild.

    [DPF: My comment was underneath the fiscal deficit figure. Labour have opposed every single measure of spending restraint for five years, so I’m damn sure we won’t see a surplus under them anytime soon]

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  2. Harriet (5,201 comments) says:

    Who would’ve thought Israel would be ranked the highest.

    With all their ‘past’ ‘grievences’ one would think that these ‘victims’ would all be unemployed, jailed, drugged, boozed, under educated, fatherless, suffering from mental anguish – and living of socialist welfare handouts from their ‘oppressors’.

    Boy have they got some mana to be proud of! :cool:

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  3. Tom Jackson (2,553 comments) says:

    You’re desperate, Farrar.

    It’s Cunliffe’s gulag for you when Labour wins. ;-)

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  4. Manolo (14,173 comments) says:

    Not for long if the socialists win the next election as comrade Tom J. wishes.
    NZ must keep the wealth-redistributors and economy-wreckers away from political power for a few more years.

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  5. Tom Jackson (2,553 comments) says:

    Next year’s unemployment rate of 5.3 per cent was not as bad as the 12.2 per cent projected for the euro area, 7.4 per cent for the United States or even Australia’s 6 per cent.

    You can thank Helen Clark’s Labour government for protecting NZ from the worst of the crash. :)

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  6. Tom Jackson (2,553 comments) says:

    NZ needs to keep the wealth-redistributors and economy-wreckers away from political power for a few more years.

    We tried, but they won the last two elections.

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  7. Redbaiter (10,443 comments) says:

    Gosh three comments from Tom already.

    He’s really got a burr under his saddle since Cunliffe made leader.

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  8. alloytoo (582 comments) says:

    If it ain’t broke, don’t fix it.

    Tune it.

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  9. Changeiscoming (202 comments) says:

    Anyone can get growth by borrowing money. Growth based on debt is not real growth at all. Real success is where you get good consistant growth year after year, while living within your means.

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  10. tvb (4,556 comments) says:

    Borrowing to build long term infrastructure projects that add to the wealth of the country is sensible. Borrowing for consumption is not.

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  11. flipper (4,332 comments) says:

    Harriet…
    Israel has one hard-head sunzabitch Reserve Bank Governor in the Brash, Bollard, Wheeler mould.
    But the red melon genius, petersparty2 and Goitre Chin (acting on instructions from Kelly/Conway), will take us back to the dim dark ages.

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  12. burt (7,428 comments) says:

    Tom

    You can thank Helen Clark’s Labour government for protecting NZ from the worst of the crash.

    You idiot – It was Clark’s government that had NZ in recession while the rest of the world was just starting to acknowledge the sub-prime mortgage crisis in the US – Before the Global financial crisis.

    I know – you like to remember the fun days when NZ voters were gaining personal debt and the country was using excessive taxation to reduce the government debt at the expenses of workers.

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  13. RightNow (7,015 comments) says:

    I can’t believe I’ve only just realised Tom Jackson has been doing a subtle parody of a lefty idealogue this whole time. Genius.

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  14. Antarg (38 comments) says:

    If you haven’t read yourstrawman.com, perhaps you think economic growth means something completely different…

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  15. Harriet (5,201 comments) says:

    “…..Anyone can get growth by borrowing money. Growth based on debt is not real growth at all. Real success is where you get good consistant growth year after year, while living within your means…..’

    So if a business has slumped in sales and profit, and they see another market opening, but need some capital for particular plant and equipment to supply that market – then borrowing is foolish?

    Where do we then look for prosperity?

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  16. Sir Cullen's Sidekick (900 comments) says:

    Good to see David Cunliffe’s policies are already working even when he is in opposition.

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  17. gump (1,685 comments) says:

    It’s been mentioned already, but our economic growth is currently being driven by the Christchurch rebuild.

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  18. thePeoplesFlag (283 comments) says:

    “…4th in the developed world isn’t bad…”

    In the DEVELOPED world.

    Nice try at cherry picking, but no cigar.

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  19. dime (10,215 comments) says:

    urgh, can someone please give wussell back his peoples flag

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  20. Alan (1,087 comments) says:

    If israel, hong kong, singapore and korea are ahead of you, then you’re 5th, not 4th. Sesh

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  21. RightNow (7,015 comments) says:

    now now dime, I’m sure in all fairness to wussell’s fwag we should be incwusive.
    I see we’re also doing well compared to zimbabwe and north kowea.

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  22. Kea (13,571 comments) says:

    flipper, you seem confused.

    Israel gets billions of dollars in aid every year from flat broke America.

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  23. Manolo (14,173 comments) says:

    Kea, I commend to you a good book with an excellent chapter on the subject of Israel-US relations. It’s called Marching Toward Hell by Michael Scheuer.

    The author analyses and takes a very critical view of such relationship.

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  24. Kea (13,571 comments) says:

    Manolo, cheers. I will try and get a copy.

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  25. Psycho Milt (2,427 comments) says:

    Labour have opposed every single measure of spending restraint for five years, so I’m damn sure we won’t see a surplus under them anytime soon.

    Can’t be arsed actually doing it, but I expect a comparison of the last Labour govt with the current National one wouldn’t endorse that view.

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  26. Weihana (4,621 comments) says:

    [DPF: My comment was underneath the fiscal deficit figure. Labour have opposed every single measure of spending restraint for five years, so I’m damn sure we won’t see a surplus under them anytime soon]

    And yet the last Labour government increased spending, enjoyed budget surplus, reduced debt and experienced economic growth.

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  27. Weihana (4,621 comments) says:

    burt (6,222) Says:
    October 10th, 2013 at 1:58 pm

    You idiot – It was Clark’s government that had NZ in recession while the rest of the world was just starting to acknowledge the sub-prime mortgage crisis in the US – Before the Global financial crisis.


    The New Zealand economy entered recession in early 2008, before the effects of the global financial crisis set in later in the year. A drought over the 2007/08 summer led to lower production of dairy products in the first half of 2008. Domestic activity slowed sharply over 2008 as high fuel and food prices dampened domestic consumption while high interest rates and falling house prices drove a rapid decline in residential investment.

    http://www.treasury.govt.nz/economy/overview/2010/04.htm

    Seems the Treasury forgot to include “…and because Helen Clark was an evil bitch sucking the life out of the economy.”

    :)

    I know – you like to remember the fun days when NZ voters were gaining personal debt and the country was using excessive taxation to reduce the government debt at the expenses of workers.

    Reducing government debt? The evil bastards!

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  28. Dazzaman (1,082 comments) says:

    Um Harriet, the Israeli’s are not an oppressed minority…

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  29. Anthony (768 comments) says:

    Weihana, was it OK to reduce government debt but encourage the country to massively run up private sector debt, with a huge part of that going on buying houses? NZ is one of the most indebted developed countries when it comes to private sector debt.

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  30. Weihana (4,621 comments) says:

    Anthony (679) Says:
    October 10th, 2013 at 8:06 pm

    Weihana, was it OK to reduce government debt but encourage the country to massively run up private sector debt, with a huge part of that going on buying houses? NZ is one of the most indebted developed countries when it comes to private sector debt.

    Most of the last 20 years has shown significant increases in private sector debt so I’m not sure that Labour deserves special blame in this regard. A large part of it is going to houses and significant contributor to that is no capital gains tax and migration.

    But yes, regardless it was good to pay down national debt.

    http://www.treasury.govt.nz/publications/reviews-consultation/savingsworkinggroup/finalreport/19.htm

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