BALANCE OF PAYMENTS IMPROVEMENT

Press, Volume CII, Issue 30045, 1 February 1963, Page 13

BALANCE OF PAYMENTS IMPROVEMENT

(New Seafaad Fran luniMtiaJ

WELLINGTON. January 31. A sharp improvement in New Zealand’s balance of payment* last year i* apparent from the Reserve Bank’s statement of receipts and payments of overseas exchange for 1962.

The drop in payments for private imports—from £273m in 1961 to £226m in 1962—was the main factor fa the improvement, though increases fa export receipts were contributing factors.

Tbm was an over-eU gurplus of £124 mSEca lata year. Ou cusrent account tooce was a surplus cf £2.8 million, an impccvemetta of £55.0 million on lata year’s cumnt account deficit cf £525 million, In recent yean toe changes in toe balance on current account (1050 a surplus of £36.9 million, 1980 a deficit of £285 million) have been caused mainly through large fluctuations in payments tor private imports. Payments tor “divisible” items have risen steadily and current receipts have remained fairly stable over toe tour yean. Expert receipts contributed significantly towards toe better balance on cunrent account, rising to toe record level (tor a calendar year) of £3085 million. Butter prices in toe United Kingdom continued to rise in 1062, reaching a level of £316 per ton in November, 1962, compared with toe £250 per ton received during most of 1961. Butter receipts thus increased by £66 million to £465 million, toe highest level since toe record £60.4 million received in 1950 (when exceptionally high prices wars received). Meat receipts have risen steadily since 1060. In toe 1981-62 season meat production for export exceeded 500,000 tons tor toe first time and this, together with good lamb prices in toe United Kingdom, enabled meat receipts to reach £86.8 million in 1962. A somewhat disappointing wool season in 1961-62 saw production fall—for the first time in a decade—while prices also tended to fall, the average realisation ptrice at New Zealand auctions being

»J 8 pence per *> compared wMh 4034 pence fa 1980-81. Prices have recovered well tote season and wool receipts are again rising. Nevertheless, toe calenoar year receipts far wool, rt £100.4 miufon, were lower than fa either of toe two precodtag Cheese reeejpts have continued at a fairiy atabte level, while receipts for taker exports recovered to £164.5 million after a drop fa 1961. Import Paymenta Payments tor private imports over toe lata tour years have fluctuated widely from £20612 million in 1959 to £2725 million in 1961, payments tote year cf £226.8 million being toe lowest since 1950. The average expenditure on private imports over toe four years was £2404 million. Government import payments have continued to rise fa recent years and tote year totalled £255 million. On capital account there was a surplus of £99 million. Government capital receipte totalled £ 192 million and included receipts from loans raised in London (£9(6 million) and New York (£8.5 million). Government capital payments of £16.0 million related mainly to toe purchase of investments overseas. There was a net private capital inflow of £5.7 million, about toe seme as in earlier years. The overall surplus for toe year of £12.4 mdl&on enabled the net ovenseas assets of toe , banking system to rise from ’ about £4O million at toe end of 1961 to £B2 million a year ' later.

Receipts IMS 1961 IMO tm £m £m Exports— Butter .. 48.0 41.4 44.7 Chees. .. 104 10.8 18.7 Meat .. M.8 80.4 77J Wool .. 100.4 1023 1043 Other .. M3 80.8 M3 Other current receipts .. 39.1 30.4 SI 3 Capital Receipts— Govt. .. 193 813 8.7 Private .. 11.1 10.4 8.4 Total receipts 3664 307.1 348.7 Payments Import*— Govt. .. 26 4 M.4 38.0 Private .. 186.8 3723 2663 Other current payments— Govt. .. 17.7 183 16.4 Private .. 663 66.1 80.1 Capital payments— Govt. .. 180 103 13.4 Private .. 8.4 8.4 5.4 Total payments .. 386.7 408.8 373.1 Trade balance +57.7 — 13 +313 Invisible bal. —66.1 —80.9 —46.0 Cur. a/c bal. + 2.6 —623 —433 Cap. a/c bal. + 9.9 +36.8 — 3.7 Overall bal. +12.4 —164 —27.4