Great Recession in Oceania
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Australia
Australia avoided technical recession due to a number of factors: the country's low levels of public debt allowed government stimulus spending; its proximity to the booming Chinese economy and the related mining boom kept growth ticking over throughout the worst of the global conditions. In fact, sources such as the IMF and the Reserve Bank of Australia had predicted Australia was well positioned to weather the crisis with minimal disruption, sustaining more than 2% GDP growth in 2009 (as many Western nations went into recession). In the same year the World Economic Forum ranked Australia's banking system the fourth best in the world, while the Australian dollar's 30% drop was seen as a boon for trade, shielding the country from the crisis and helping to slow growth and consumption.[1][2]
Some analysts had predicted the continuing decline of trade in 2009 could put the economy into recession for the first time in 17 years.[3] However these initial fears were proved largely unfounded as the Australian economy avoided recession and the unemployment rate peaked at a much lower rate than had been predicted.
New Zealand
 | This article needs to be updated. (January 2013) |
New Zealand Institute of Economic Research's quarterly survey showing New Zealand's economy contracted 0.3 percent in the first quarter of 2008 and Treasury figures suggested the economy also contracted in the June quarter putting New Zealand in a technical recession.[4] The Treasury says the economy could recover in the second half of the year under the impact of high dairy prices boosting farmer incomes and cuts to personal tax rates, which come into effect on Oct. 1.[5] About 23 financial companies in New Zealand have filed for bankruptcy in a year. Housing starts in New Zealand fell 20 percent in June, the lowest levels since 1986.[6] Excluding apartments, approvals dropped 13 percent from May. Approvals in the year ended June fell 12 percent from a year earlier. Second-quarter approvals dropped 19 percent. The figures suggest a decrease in construction and economic growth. House sales fell 42 percent in June from a year earlier.[7] The New Zealand Treasury concluded that the country's economy had contracted for a second quarter based on economic indicators, putting New Zealand in a recession.[8] New Zealand's central bank cut rates by half a percent arguing the economy was in recession.[9] New Zealand's GDP declined by 0.2 percent in the second quarter putting the country in its first recession in a decade.[10]
The economy emerged from recession in mid-2009, with the second-quarter GDP report showing the economy grew by 0.1 per cent on the March quarter.
New Zealand suffered a double dip recession in the wake of the global financial crisis, with the second leg coming in late 2010, new data has revealed
Statistics NZ today released gross domestic product figures for the September quarter showing the economy grew by 0.2 per cent, slightly below most economists' picks.
But it also issued revised GDP numbers that showed the economy contracted 0.3 per cent in the September and December quarters of 2010, following the recession that started in March 2008 and ran until June 2009.
Earlier data had suggested the economy narrowly missed the second dip, by contracting 0.1 per cent in September 2010 and staying flat in the December quarter that year.
Economists define a recession as a contraction in two consecutive quarters.
The revisions also show that growth has been weaker this year than previously thought, with growth in the March quarter revised down from 1.0 per cent to 0.9 per cent, and in the June quarter from 0.6 per cent to 0.3 per cent.
However, the revisions showed the economy performed better in 2011 than previously thought, with all four quarters revised higher by between 0.1 and 0.3 percentage points.
Labour finance spokesman David Parker said the double dip recession came at the same time that National's 'tax-switch', that raised GST, came into force.
"National has trumpeted its tax switch as a boost to the economy. But the truth is it kept growth negative and held the economy in recession," he said.
"National's tax switch was not only unequal and unfair, it choked off demand and the economy shrank."
Finance Minister Bill English today said the economy remained on track for moderate growth over the next few years, "despite growth predictably easing a little in the September quarter".
Annual growth - from the September quarter 2011 to the September quarter 2012 - came in at 2 per cent, after the revisions English said.
"After coming off a good growing season and a strong year for agriculture, other indicators had already pointed to a slightly softer performance in the third quarter," he said.
"However, there are signs that the pace of growth has picked up in recent months, with rising consumer and business confidence and a further strengthening of construction activity. We shouldn't get distracted by the quarterly movements, particularly with the global environment remaining uncertain."
What was important was that the economy is on track for 2 per cent-plus growth over the next few years. Ad Feedback
He said the Government's business growth agenda would help support businesses create jobs.
"The unemployment rate is too high and this will be a particular focus for the Government in 2013," he said.
"Despite global headwinds, New Zealand is performing better than many other countries. We're seeing positive signs through higher savings, households and businesses paying down debt, and interest rates and inflation remaining low." [12]
References
- ^ Stutchbury, Michael (2008-10-11). "Calls for international community to flush the system". The Australian.
- ^ Yeates, Clancy (2008-10-11). "The fall of the little Aussie battler". The Sydney Morning Herald.
- ^ Australia seen sliding into recession in 2009, International Herald Tribune, January 19, 2009
- ^ "New Zealand considered to be in recession". Xinhua. 2008-07-09. Retrieved 2008-07-19.
- ^ "NZ Treasury: economy may be in recession already". Reuters. 2008-07-07. Retrieved 2008-07-19.
- ^ Evans-Pritchard, Ambrose (2008-07-29). "Australia faces worse crisis than America". London: Daily Telegraph. Retrieved 2008-07-30.
- ^ "New Zealand Building Approvals Fall to 22-Year Low". Bloomberg. 2008-07-29. Retrieved 2008-08-10.
- ^ "New Zealand 'enters recession'". BBC News. 2008-08-05. Retrieved 2008-08-10.
- ^ "New Zealand slashes rates as economy lurches toward recession". London: Daily Telegraph. 2008-09-11. Retrieved 2008-09-12.
- ^ "New Zealand Economy Shrank 0.2%, Confirming Recession". Bloomberg. 2008-09-26. Retrieved 2008-09-26.
- ^ Louisson, Simon (2009-09-24). "New Zealand's economy grew 0.1% in second quarter". The Wall Street Journal Asia. Vol. 34, no. 18. p. 14. Retrieved 2009-11-17.
- ^ Louisson, Simon. "Economy's growth hit revealed". stuff.co.nz.
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