New Zealand Trade Deficit Narrows

New Zealand posted its smallest annual trade deficit in more than seven years in 2009 as imports fell for a ninth month in December, outpacing a decline in exports., Statistics New Zealand 1/28/2010 5:23:26 PM

Removing seasonal effects, merchandise import values declined 3.2 percent in the December 2009 quarter, compared with the September 2009 quarter, the fifth consecutive quarterly fall, Statistics New Zealand said. The decline for the December 2009 quarter was widespread, with falls in capital goods, intermediate goods, and consumption goods being partly offset by increases in passenger cars and petrol and avgas.

Similarly, merchandise export values fell 2.8 percent in the December 2009 quarter, after removing seasonal effects, the fourth consecutive quarterly decrease for exports. The decline for the December 2009 quarter was dominated by falls in milk powder, butter, and cheese, and crude oil. In the December 2009 quarter milk powder, butter, and cheese recorded the largest decrease and is now at its lowest value since the September 2007 quarter.

Quarterly seasonally adjusted imports and exports both recorded their highest ever values in the 2008 year, and have consistently declined since then. Imports have dropped 24.6 percent since peaking in the September 2008 quarter, while exports have dropped 17.3 percent since peaking in the December 2008 quarter.

The seasonally adjusted trade balance for the December 2009 quarter was a deficit of $170 million (1.8 percent of exports), following deficits of 2.6 percent and 2.3 percent of exports in the June and September 2009 quarters respectively. The most recent quarterly seasonally adjusted trade surplus was in the December 2001 quarter.

In the month of December 2009, merchandise imports declined 18.6 percent ($776 million) from December 2008, led by mechanical machinery and equipment. Merchandise exports declined 11.3 percent ($433 million) in December 2009, compared with December 2008, with the largest falls coming from milk powder, butter, and cheese; aircraft and parts; and meat and edible offal. Since peaking in the latter part of 2008 the trends for imports and exports have declined 25.0 percent and 14.9 percent respectively, although the rate of decline appears to have eased in recent months.

New Zealand Trade Deficit Narrows