Swings, roundabouts in latest statistics

Press, 28 December 1985, Page 17

Swings, roundabouts in latest statistics

PA Wellington The early days of the surge in the New Zealand dollar- were not all painful, according to the latest trade figures from the Government Statistician, Mr Stephen Kuzmicich. But there were signs that all was not well for exporters between July and September, the period covered by the trade figures. For exporters, the stronger dollar turned out to be a mixed bag of “tricks and treats."

The figures show a 10 per cent rise in export values between the 1984 and 1985 September quarters. Between July and September this year, when the dollar surged from US4Bc to US55c, exporters were still doing better than they were a year earlier. The position for New Zealand as a whole seemed to be even better. Import values dropped 0.5 per cent between the 1984 and 1985 September quarters, with

the results that exports came closer to paying for what New Zealanders imported from other countries.

The difference between import and export values was a deficit of $520 million in the September quarter, 1984. This year, that deficit was halved to $258 million, and for the year, another healthy drop in the deficit on New Zealand’s currrent account, the measure of its export-import trade balance, was recorded. The current account deficit had ballooned to $2BlB million in the March quarter this year. Since then, it has fallen to $2712 million in the June quarter, and now to $2441 million in the September quarter. All this, while the dollar was gaining strength by the day, would appear to be cheerful news. But the signs were there that exporters may have been finding conditions a little tougher. The value of exports, though higher than a year

ago, were well down on levels in the first six months of this year. A big dip in export values in the September quarter appears to be out of character, when compared with 1984 and 1983 figures. Export values in the September quarter this year were $2681 million, down from $3164 million in the June quarter, and $3056 million in the March quarter.

At the same time, import values were virtually static, moving from $2821 million in the March quarter, to $2951 million in the June quarter, and back to $2939 million in the September quarter. The result was that the balance on merchandise trade fell from healthy surpluses in March ($235 million) and June ($212 million), to a deficit of $258 million in September. “Invisibles,” which include transport, insurance and other services, pro-

duced further losses, resulting in a current account deficit for the September quarter of $BBB million up on deficits of $445 million in June and $222 million in March.

The drop in the current account balance for the year to $2441 million was because the September quarter current account balance last year was heavily “in the red” to the tune of $ll5B million, reflecting the first effects of the 1984 devaluation on imports. This figure has never been repeated, so that later current account figures have shown distinct improvements. What the figures cannot show is the damage, the stronger dollar could have caused in making New Zealand exports so much more expensive that they were locked out from overseas markets. They do not include volumes, which could show whether export trade was growing, or shrinking. These figures are expected to be released much later.

An earlier report from the Statistics Department that import values in September were 0.5 per cent higher than in the September, 1984, quarter was corrected by the department after a reporter drew attention to the error.