Fewer imports help trade balance

By Phil Boeyen, ShareChat Business News Editor

Thursday 27th September 2001

Provisional figures for August point to further improvement in New Zealand's trade balance.

Statistics New Zealand reports the provisional value of merchandise imports for August 2001 is $2.747 billion, putting total imports for the year ended August at $32.295 billion.

An early estimate for August exports is $2.65 billion, giving a trade deficit of $97 million for the month but a surplus of $325 million for the year.

That compares to the $45 million trade surplus for the year ended July, which was the first annual surplus since 1995.

According to last month's import figures the country is buying more goods from China, Germany, Malaysia and Qatar but less from the US due to lower imports of large aircraft and electrical machinery and equipment.

Deutsche Bank says the $97 million trade deficit for the month of August is better than expected due to the lower value of imports, mainly from lower oil imports.

"Looking at the breakdown of imports, we are encouraged that plant and machinery has continued to recover from the weaker levels seen earlier this year," says senior economist Darren Gibbs.

"Although little changed from the same time last year, plant and machinery imports in the three months to August were 17% stronger than in the previous three-month period."

However Mr Gibbs says that in light of recent events in the US the ensuing global uncertainty there is some risk that investment may begin to taper off - at least temporarily - towards the end of this year as investment plans are put on hold.

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