New Zealand Falls Into Second Recession In 18 Months

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New Zealand’s government reveals that the country is facing its second recession in less than 18 months.

 

New Zealand’s economic decline

During the October-December period, New Zealand experienced a 0.1% decrease in its GDP, following a 0.3% decline in its third quarter. As per government reports, the economy saw a 0.7% decline on a per capita basis in the last quarter of 2023.

This recession is followed by the Bank of New Zealand’s vigorously high-interest rates aimed at curbing some of the highest inflation rates among developed countries, thereby restraining economic activities.

This economic recession persists even though the country’s inward migration saw over 33,000 net arrivals in the previous year.

 

Political perspectives on the recession

New Zealand’s Finance Minister Nicola Willis, representing the centre-right National Party, holds the previous Labour Party government’s “big spending, big taxing” approach as the cause behind the recession. The Labour Party lost the general elections last October.

Nicola Willis finds the recession to be gravely concerning despite the country’s growing population.

Barbara Edmonds, Labour’s finance spokesperson, blames the current government’s inability to implement any new policies to aid its citizens in dealing with the cost of living.

Edmonds says that the government has allocated nearly 3 billion to landlords and still aims for tax cuts that won’t benefit working people in any way, rather than implementing policies to reduce the cost of childcare or provide free discounted prescriptions or subsidised transport.


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