NZ GDP per capita growth lowest since 2011

By Leith van Onselen

Statistics New Zealand has released national accounts figures for the March quarter of 2018, with Gross domestic product (GDP) rising by 0.6% over the quarter to be up 2.7% year-on-year. GDP per capita rose by 0.1% over the March quarter and rose by 0.9% year-on-year – the lowest annual GDP per capita growth since 2011.

As shown below, mining, manufacturing and construction drove the GDP growth:

Household consumption expenditure continues to ease:

Real gross national disposable income (RGNDI) – which measures the real purchasing power of New Zealand’s disposable income – rose by 0.6% in the March quarter, driven by a 1% rise in the terms-of-trade, and was up 2.5% year-on-year:

A population increase of 0.5% over the March quarter meant RGNDI per capita rose just 0.1% over the quarter and by 0.6% year-on-year.

Statistics New Zealand points out that New Zealand’s economy is growing above the OECD average:

However, it should be noted that New Zealand’s population growth is among the fastest in the world at 1.9%, owing to the nation’s high immigration program.

Thus, New Zealand’s growth figures are being heavily inflated, and per capita growth is soft, much like Australia.

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Leith van Onselen

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