New Zealand Economy Emerges From Recession With 0.2% GDP Growth
New Zealand’s economy showed signs of recovery as it emerged from recession with a 0.2 percent growth in Gross Domestic Product (GDP) in the first quarter. This growth comes after facing back-to-back downturns over the past 18 months.
The growth, driven by record-high immigration, was higher than expected but experts warn that it masks underlying weaknesses. On a per capita basis, GDP actually fell by 0.3 percent, marking the sixth consecutive decline.
With high inflation and elevated borrowing costs casting a shadow on New Zealanders, Finance Minister Nicola Willis acknowledged the challenges faced by the population. Willis emphasized the government’s commitment to turning things around through careful spending and tax cuts for hard-working individuals.
The country’s economy has been grappling with the aftermath of the COVID-19 pandemic, with key sectors like agriculture and tourism bearing the brunt. The Reserve Bank of New Zealand’s decision to raise interest rates to a 14-year high aims to address soaring inflation rates, albeit with potential implications on economic activity.
Prime Minister Christopher Luxon’s budget proposal of tax cuts totaling $14.7 billion New Zealand dollars over four years reflects the government’s efforts to stimulate economic growth and support the population through challenging times.
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