N.Z. Payments May Balance By 1969

Press, Volume CVII, Issue 31564, 29 December 1967, Page 8

N.Z. Payments May Balance By 1969

New Zealand may achieve a balance of payments in its external accounts by June, 1969, says the New Zealand Institute of Economic Research in its December quarterly predictions.

The institute forecasts a deficit of slosm for the year ending September, 1968, compared with s2lom for the year ended June of this year.

This, says the report, reflects both a reduced level of imports and, more importantly, an increase in export

volumes and prices. These tendencies will be assisted by devaluation, but they were already evident even in its absence.

Export receipts from nondevaluing countries are expected to Increase 24 per cent in New Zealand currency, and 6 per cent from devaluing countries. This assumes that New devaluation will not affect the prices received in overseas currencies for its exports, so that there

will be a consequent gain in New Zealand’s currency equivalent to the full extent of the devaluation. As well, a 5 per cent increase in prices for beef and lamb is forecast Another forecast is that wool prices for the current season will increase to 25c and in the next year to 30c on average, at which point the Wool Commission will sell part of its stockholding. The volume of imports for 1967-68 is expected to decline, perhaps faster than expected, but in value terms part of this decline will be offset by price increases. The forecast balance of payments, current account, for the next two years, each year ending in June, is:—

The year to June, 1967, is estimated to produce a deficit of 8210 m, with exports at 8745 m, imports at 8720 m, net invisibles at 8210 m, and net transfers at 825 m.

($m) 1968 1969 Exports f.o.b. 835 980 Imports f.o.b. -685 -700 Net invisibles -230 -250 Net transfers -26 -28 Balance -105 ■ '