As the outperformance that earned New Zealand the status of ‘rock star economy’ begins to wan, the government should focus on ensuring a ‘rock solid’ economy, New Zealand Treasury Secretary and Chief Executive Gabriel Makhlouf told CNBC on the sidelines of the Group of 20 meeting in Australia.
New Zealand bucked the poor global growth trend over the past few years, posting a strong economic performance as a series of headwinds dragged growth elsewhere. It grew an annual 3.9 percent on year in the second quarter – the fastest rate since the second quarter of 2004. However, on a quarterly basis the economy expanded 0.7 percent, slowing from three consecutive quarters of growth of 1 percent or more and suggesting a peak in the current growth cycle.
Meanwhile, in August, Makhlouf said the New Zealand government will reach its budget surplus forecast this fiscal year but noted that future surpluses could be lower than expected as economic activity is weaker than forecast in May. The budget has been in deficit since 2009.
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