Last Thursday marked Race Relations Day in New Zealand. The day was an opportunity to acknowledge and celebrate our nation’s ethnic diversity. New Zealand prides itself on being an inclusive society, and the day was also a chance to reaffirm our commitment to harnessing the potential of all our ethnic Kiwis and to acknowledge the positive contribution they make. Last week was another busy one with the House sitting but I’m pleased to deliver some positive news, with our economy recording a lift in growth in the December quarter. Gross domestic product grew 1.5 per cent in the three months to 31 December, 2012. This takes annual growth – from the December quarter 2011 to the December quarter 2012 – to 3 per cent.
This is consistent with a broad improvement in activity and confidence. As we have previously noted, New Zealand is still performing compared to other countries around the world. New Zealand’s GDP growth of 3 per cent in 2012 compares with 1.6 per cent in the US, 1.1 per cent in Canada, 0.4 per cent in Japan, 0.3 per cent in the UK and -0.9 per cent in the Euro area. Indicators show that growth will continue this year as consumer and business confidence rises. A lift in household spending signals that New Zealanders are feeling more secure and optimistic about the economy.
On the back of this news, I also welcome the International Monetary Fund’s conclusion that our Government’s deficit reduction programme strikes the right balance between supporting growth and limiting public debt. This reflects the balanced and pragmatic approach that we have been taking with our economic programme over the past four years. We expect our growth to continue as the Government retains tight control of its spending, households and businesses pay down debt, and very low interest rates and low inflation continue their long run.
In light of this encouraging announcement, it nonetheless remains a priority for us to continue the focus on our Business Growth Agenda initiatives, which are aimed at improving New Zealand’s productivity and competitiveness as a way of fostering job growth and lifting wages. We will press ahead with a wide range of measures to build a more productive and competitive economy on the solid foundations of investment, exports and savings.