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11:50 a.m. – The government is supplementing the COVID-19 Response and Stimulus Fund by an additional $ 7 billion, Finance Minister Grant Robertson said Thursday.
“The strength of the economy has been reflected in the government’s books, with lower debt and deficits than expected, and well below those of other countries we compare ourselves to,” said Robertson.
“Ministers decided to use the larger fiscal space to top up the COVID-19 Response and Stimulus Fund (CRRF) by an additional $ 7 billion. There is also an additional $ 3 billion available to spend from the money previously allocated in the fund that has not We have already stepped up support to businesses during this period of containment and the additional funding will be intended for additional economic support as well as strengthening the resilience of our health system , supporting the deployment of vaccination and the provision of borders and MIQ.
“We are in a strong economic position to protect lives and livelihoods and to plan New Zealand’s gradual and prudent opening up to the rest of the world to ensure recovery. Our goal remains to keep New Zealanders safe. , accelerate the recovery and deal with long-standing issues such as climate change, housing and child welfare despite the global uncertainty and volatility around the continued impact of COVID -19. “
Robertson also said the economy had shown strong momentum in the run-up to the recent outbreak, bodes well for a strong economic rebound.
GDP grew 2.8% in the June quarter, following a 1.4% increase in the previous March quarter. It was a significantly better result than what most forecasters had predicted. The Treasury had forecast a 0.8% hike in the May budget, and economic commentators using more recent data had forecast a hike of around 1.2%. Internationally, the OECD average was 1.6%.
“This is a very positive result and shows the confidence of New Zealanders in our roadmap for economic recovery. Excluding the September 2020 quarter, this is the strongest quarterly growth we have seen since 1999. The economy in the June 2021 quarter was 4.3% higher than in June 2021. It was in the pre-COVID quarter of December 2019, â€said Robertson.
“Household spending remained dynamic, driven by retail spending on electronics and furniture, restaurants and vacations. Service industries, which account for two-thirds of the economy, have grown strongly with higher activity in engineering, architectural and consulting services.
“Activity in the construction sector continued to increase, driven by residential construction, while there was solid growth in the manufacturing sector. Business confidence in the economy was also reflected in investment levels, which remained high and above pre-COVID levels in the December 2019 quarter.
“This bodes well as we come out of lockdown. It shows that our science and health focused plan has continued to work for the economy. Our swift and decisive response to this outbreak, including providing cash and cash flow. Confidence through programs such as the wage subsidy will also help the economy rebound quickly, but we know the impact has been uneven and we will continue to work with affected sectors to support them in these difficult times.
On an annual basis, the economy grew 5.1%. The size of the economy was $ 340 billion.
“New Zealand continues to outperform many of the countries we compare ourselves with,†said Robertson.
Compared to New Zealand’s 2.8% quarterly growth, Australia grew 0.7%, the United States 1.6% and Japan 0.5%, while Canada fell 0.3%. Only the UK advanced further, up 4.8%, reversing recent declines in activity.
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