BOP Defecit: Fifth Consecutive Quarterly Decrease

Balance of Payments and International Investment Position: March 2001 quarter

Trend Shows Fifth Consecutive Quarterly Decrease in BOP Deficit

New Zealand's current account balance recorded a surplus of $95 million in the March 2001 quarter, Government Statistician Brian Pink said today. After adjusting for seasonal factors, the current account balance recorded a deficit of $1,007 million.

The trend estimate for the current account balance has now recorded a falling deficit for five consecutive quarters. Since the June 2000 quarter, increasing surpluses in the trend estimate for the goods and services balance have offset increasing quarterly deficits in the income and transfers balance.

The seasonally adjusted current account balance of $1,007 million is $571 million smaller than the December 2000 deficit of $1,578 million. The falling deficit reflects rising export earnings and in the latest quarter a fall in income from foreign investment in New Zealand. Export receipts from primary products have risen steadily since the June 1999 quarter, and growth in visitor numbers have increased receipts from travel services. In the March 2001 quarter seasonally adjusted exports and imports of goods have both fallen, however, import prices fell by more than export prices.

There was a fall in the earnings of foreign-owned New Zealand enterprises in the March 2001 quarter. This was in part caused by mixed profit results and lower earnings from their overseas subsidiaries.

For the year ended March 2001, the current account balance recorded a $5,338 million deficit. This is $804 million less than the year ended December 2000 deficit of $6,142 million and $2,053 million less than the year ended March 2000 deficit of $7,391 million.

Brian Pink GOVERNMENT STATISTICIAN

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