Summarised by Centrist
The South Island is outperforming the urban north as agricultural exports and tourism replace mass migration and housing activity as New Zealand’s main sources of economic growth.
Southland recorded New Zealand’s highest GDP-per-capita growth in the year to March 2025, rising almost 10%. The West Coast followed at just over 8%, while total South Island GDP increased 5.2%, nearly twice the North Island rate.
“The big reason is that agriculture’s doing really well,” ANZ senior macroeconomist Matt Galt said, pointing to dairy, sheep and beef, horticulture and tourism.
“The really weak areas are Auckland and, even more so, Wellington,” he said.
Infometrics chief forecaster Gareth Kiernan said falling international migration was “weighing on the Auckland economy” and limiting its ability to recover.
He described the provincial resurgence as “an old-fashioned New Zealand economic recovery”.
“If you look at our performance over most of the last 30 years, economic cycles have largely been driven by changes in migration,” Kiernan said.
Strong migration flowed disproportionately into Auckland, stimulating population growth, housing construction and property activity. With New Zealand now “unable to rely on mass migration” to revive the urban north, Kiernan expects provincial regions to remain the country’s economic engine in the near term.
The political implications surfaced at NZ First’s annual convention, attended by more than 350 delegates, the largest gathering in the party’s history.
Jones said powerful political interests “don’t want us to reflect what garden-variety Kiwis are apprehensive over as they watch demographic engineering before their eyes.”
The divide is also visible in housing and internal migration. People are leaving Auckland and Wellington for Christchurch in search of cheaper homes and better employment opportunities. Auckland’s average asking price fell below $1 million in June, while Wellington homes are taking longer to sell than at any point in 34 years.
By contrast, property values increased almost everywhere south of Greymouth except Dunedin.
Read more over at The NZ Herald and Stuff
