31 July 2002 Media Statement

Story behind confidence figures still positive

“The drop in general business confidence is to be expected given lower commodity prices, higher interest rates and the turbulence in corporate America,” Finance Minister Michael Cullen said today of the latest National Bank Business Outlook.

“Labour will do its part to reduce any political uncertainty surrounding the MMP election result by completing the coalition negotiations as soon as possible around a pragmatic and progressive programme.”

Dr Cullen said it was important to read the survey results in perspective as the story lurking behind the headline figure was still good.

“The real business activity indicator is still in strongly positive territory as are expectations for employment, exports and investment. So, while it is true that external factors have increased the downside risks to the budget growth forecasts, there is also continuing evidence of underlying resilience in the New Zealand economy.”

ENDS

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