Dairying is expected to boost export-focused regions. Photo
by Peter McIntosh.
Otago regional economic confidence has taken a hit during
the past quarter, in part related to public sector cost-saving
austerity measures such as the loss of Hillside, NZ Post staff
and Invermay scientists.
Of 11 regions identified, seven recorded a lift in confidence
for the quarter to the end of September, and four a decline.
Otago had the second-greatest fall in confidence, from 12% to
3%, behind the combined Taranaki-Manawatu-Wanganui areas'
fall from 33% to 21%.
Westpac senior economist Felix Delbruck said Otago and
Wellington, down respectively to 3% and 4%, were ''subdued''.
''It's a reminder that public sector austerity continued to
weigh on parts of the economy,'' Mr Delbruck said.
The regional confidence survey measures those expecting
''good'', as opposed to those expecting ''bad'', economic
times in their area during the year ahead.
Nationally, regional economic confidence rose from 25% in the
second quarter to 27% in the third quarter.
Mr Delbruck said despite signs of slowing growth in many
developing countries, global food prices, especially in the
dairy sector, had ''defied gravity'' during the past three
''Add better growing conditions and signs of a lift in
tourism into the mix, and things are looking up for many
export-focused regions,'' he said.
Economic confidence was now very strong in the Waikato and
Southland, moderately positive in Taranaki-Manawatu-Wanganui,
and trending up in the Bay of Plenty, Gisborne-Hawkes Bay and
Nelson-Marlborough-West Coast, he said.
Southland's confidence rebounded strongly, gaining from 15%
to 53%, and was now close behind top scorer Canterbury, up
from 51% to 60%.
Soaring global dairy prices and a $30 million rescue deal
from the Government for the Tiwai Point aluminium smelter are
all likely to have boosted confidence.
He noted that the rescue package kept 3000 jobs, both direct
and indirect, ''in place for now''.
Rising house prices might also be boosting economic
confidence in many of New Zealand's smaller centres, which to
date have not been seeing the gains registered in Auckland
''Interestingly, confidence has dipped in Auckland, where the
housing market is running rampant,'' Mr Delbruck said.
With the Christchurch recovery and rebuild well under way, he
said Cantabrians' optimism for the region's economy
''continues to surge''.
''A net 60% of households now expect good times for the year
ahead - up from 51% three months ago, and the most optimistic
the region has been since 2005,'' Mr Delbruck said.