External debt rises $520M
PA Wellington Long-term overseas debt rose $520 million to $30.778 in the December quarter last year — about half that rise coming from a fall in the New Zealand dollar.
The other main contributor to the increase in debt was new borrowing by State-owned enterprises.
Long-term debt rose 1.7 per cent above the level recorded in the September quarter, said the Statistics Department. The figures show the downside of a fall in the dollar which otherwise helps exporters. About $230 million of the increase in debt came from changes in the exchange rate, mainly falls against the Japanese yen and British pound.
The increase would have been even greater had the New Zealand dollar not risen against the United States dollar. Just under half of New Zealand’s long-term debt is held in United States dollars, so a 2.2 per cent rise against the greenback helped to offset falls against the yen (4.3 per cent) and pound (3.9 per cent). Exchange rate movements accounted for a $230 million rise in debt in the December quarter, and State-owned enterprises borrowing accounted for another $250 million.
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Press, 4 March 1989, Page 8
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186External debt rises $520M Press, 4 March 1989, Page 8
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