Summarised by Centrist
New Zealand’s economy grew 0.7% in the December quarter, officially ending the recession, but growth per person remains weak.
In simple terms: New Zealand had a sharp downturn last year and is now seeing a small rebound, but other economies didn’t fall as hard in the first place.
While agriculture, tourism, and retail improved, construction and telecommunications slumped. GDP per capita rose just 0.4%—its first increase in two years—but remains more than 2% lower than a year ago.
GDP measures a country’s total economic output, while GDP per capita shows how much of that growth benefits individuals—overall GDP can rise with population growth, even if people are worse off, which is why politicians prefer the bigger, less revealing GDP figure.
Finance Minister Nicola Willis welcomed the growth but admitted many Kiwis are still struggling with high inflation and interest rates. Acting Prime Minister David Seymour called it “the first green shoots of an economic recovery”, while Labour’s Chris Hipkins argued that job losses in construction show the economy is still in trouble.
While New Zealand’s quarterly GDP growth data suggests a short-term bounce, the economy is still weaker overall compared to other countries. Other economies may have had slower growth this quarter, but they didn’t contract as much over the past year.
