The OECD’s latest review of the New Zealand economy shows growth picking up due to the Government’s ongoing support to secure the recovery from the effects of COVID-19.
“The OECD Economic Outlook notes New Zealand is expected to be one of the stronger performers in the OECD, with a robust rebound due to our swift and decisive response to eliminate the virus and support households and businesses,” Grant Robertson said.
“It forecasts growth of 3.5 percent in 2021 and 3.8 percent in 2022, in line with the Budget Update, driven by solid household consumption, rising investment in infrastructure and gradual increase in tourism as borders reopen.
“By the end of the forecast period, New Zealand’s growth rate of 3.8 percent is expected to outperform most of the countries we compare ourselves to. Australia is 3.4 percent, Japan 2 percent and the United States at 3.6 percent, while Canada matches New Zealand at 3.8 percent.
The OECD warns that despite the improved outlook for the economy, challenges remain.
“Economic volatility is a global risk and New Zealand is not immune. There are still challenges ahead but we are in a good position to handle them,” Grant Robertson said.
“The report is consistent with the Government’s balanced approach, keeping a lid on debt while targeting support to where it’s needed most to tackle long-standing issues around climate change, housing and child wellbeing.
“Budget 2021 lifted benefits and boosted skills and training initiatives to reduce inequality and allow people to transition more easily into different types of work.
“Our housing programme announced in March includes a mix of demand and supply side measures to curb unsustainable house price and boost supply. The New Zealand Green Investment Finance scheme has been quadrupled in Budget 2021 to accelerate investment in low-carbon technology,” Grant Robertson said.