High oil prices cut New Zealand's economic growth

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19/12/2000 08:39 - (SA) High oil prices cut New Zealand's economic growth

Wellington – Rising oil prices, falling business confidence and a low New Zealand dollar have combined to cut the official estimate of the country's economic growth in the fiscal year to next March to 2.2%, down from the 3.7% predicted in the July Budget.

But despite significant economic turbulence this year, the Treasury is picking a strong rebound in 2001-02 with rising exports firing a return to growth of 3.7%, Finance Minister Michael Cullen said on Tuesday.

Releasing the Treasury's latest economic forecasts, Dr Cullen reiterated the centre-left coalition's commitment to fiscal responsibility, pledging there would be no blow-out of government spending over the next two years.

Treasury tipped a substantial improvement in New Zealand's current account deficit, decreasing steadily from 7.2% of Gross Domestic Product last June to a forecast 3.1% by March 2005.

Dr Cullen pledged that the government's economic strategy and next year's budget priorities will deliver a programme of fostering sustainable economic growth and welfare in "that will build a decent future for all New Zealanders".

Sapa-DPA

http://www.news24.co.za/News24/Finance/Economy/0,1466,2-8-25_956318,00.html

-- Martin Thompson (mthom1927@aol.com), December 19, 2000


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