New Zealand's economic context

As the Government’s lead micro-economic and business-facing agency, MBIE has many policy and service delivery functions that can affect the economy. We track various indicators to make sure we understand New Zealand’s economic context and the environment we operate in, so we can make changes where they matter.

GDP Growth

Economic growth, as measured by real gross domestic product (GDP), was 0.2% over the year to March 2024.

Growth has been modest compared with other small, advanced economies due in part to New Zealand’s high official cash rate in response to persistently high inflation.

Annual headline inflation fell to 3.3% over the year to June 2024, down from a peak 2 years earlier of 7.3%.

International trade

The value of exports continues to rise, with imports down for the year.

The value of exports rose 1.6% from $92 billion in the year ending March 2023 to $93.5 billion in the year ending March 2024. A fall in exports to Australia, China and Japan was offset by a rise in exports to the United States of America, United Kingdom and other countries.

Imports fell 6% over the same period, leading to a narrowing of New Zealand’s trade deficit, from $16.1 billion to $8 billion.

Business environment

Businesses have been under pressure this year from lower demand and elevated interest rates.

The ratio of non-performing business loans has risen for small to medium enterprises (SMEs) (1.1% as of June 2024), while for large businesses it has remained relatively steady over the year ending June 2024.

The number of company liquidations has risen, with over 2,100 liquidations in 2023/24, a 19.3% increase on the previous year.

Migration flows

Estimated net migration hit a record high in late 2023, peaking at 136,600 for the year ended October 2023. It has since fallen to 73,300 for the year ended June 2024.

Annual migrant arrivals remain above thelong-run average, at over 204,500 to June 2024, but are offset by steady growth in the number of migrant departures over the past 18 months. 

Labour market

Tightness in the labour market has eased as higher interest rates continue to dampen demand across the economy.

Unemployment rose to 4.6% in the June 2024 quarter with the Reserve Bank of New Zealand expecting it to peak at 5.4% in early to mid- 2025. The 15 to 24 year old not in education, employment or training (NEET) rate was 11.9%.

Wages (salary and wage rates, including overtime) rose 4.3% over the year to June 2024, outpacing annual inflation of 3.3% over the same period.

Emissions intensity

New Zealand’s emissions intensity is now below global averages.

New Zealand saw a steady fall in its emissions intensity between 1990 and 2022. Since 2021, it has been less intensive than the global average, with 0.38 tonnes of carbon dioxide equivalent (t CO2e) emissions per US$1,000 purchasing power parity (PPP).

Due to our comparative reliance on primary sector activity, New Zealand’s economy has a higher emissions intensity compared with other small, advanced economies.

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