Wednesday 21 December 2011

New Zealand deficit

NZ current account deficit worsens
New Zealand's annual current account deficit has worsened to 4.3 per cent of gross domestic product for the September year, from 3.7 per cent in the June year as export prices tumbled.

21 December, 2011

The annual current account deficit was $8.7 billion in the September year and worse than some expected. It compared with a $7.4b shortfall in the June year.

Last week, Westpac Bank economists said they expected the deficit to widen only a little further to 4 per cent of GDP. That was expected because of softer commodity prices, especially for dairy products, hitting the balance of goods trade.

Exports of goods were worth $3b more than imports, leaving the goods balance well into the black for the year.

At 4 per cent, the annual current account deficit was "well within manageable levels", Westpac said last week.

At its worst, the deficit hit about $16.4 in 2008 or almost 9 per cent of GDP, but the shortfall narrowed sharply after the global financial crisis hit.

Figures for the September quarter deficit worsened because of falling prices for exports of meat, dairy and forestry products.

The deficit was also made worse as Australian-owned banks made more money in New Zealand, partly offset by a lift in foreign tourists during the Rugby World Cup.

New Zealand's current account deficit was $2.7b in the September 2011 quarter, Statistics New Zealand says.

The shortfall was $0.7b larger than the June 2011 quarter deficit. A current account deficit means that overseas spending by New Zealand is more than its earnings from overseas.

The larger deficit was mainly due to a fall in the goods surplus, as lower prices for exports of meat, dairy, and forestry products contributed to a $0.6b fall in the value of goods exported. Total exports of goods were worth $11.7b in the last quarter.

A $0.4b rise in the income deficit also contributed to the larger current account deficit, as foreign investors earned more from their investments in New Zealand, reflecting increased earnings by foreign-owned banks.

Exports of services increased $0.2b in the latest quarter. ''More overseas visitors came to New Zealand because of the Rugby World Cup. As a result, spending by overseas visitors and earnings of resident airlines were up,'' balance of payments manager John Morris said.

International services payments, such as the Rugby World Cup hosting fee, partly offset the increase in overseas visitors' expenditure this quarter.

In other words show the door to those people who THINK.
BusinessNZ's grinch guide on who to fire
21 December,2011

Employers' and manufacturers' lobby group Business New Zealand has injected a little spirit of the Grinch into the Christmas edition of its ManufacturingNZ newsletter, which highlights "three types of people to fire immediately."

Taken from the financial news agency Bloomberg's Business Week publication, the article suggests that "victims", "non-believers" and "know-it-alls" are the three types of people that businesses should show the door to.

"Victims are people who see problems as occasions for persecution rather than challenges to overcome," says G Michael Maddock and Raphael Louis Viton from Maddock Douglas, an American innovation consultancy.

"Note to the HR department, victims are the most likely to feel the company has maliciously terminated them regardless of cause," they advise.

Also for the high-jump should be those they call the "non-believers", who lack the willpower to back "industry-changing innovation."

"We've found the link between believing and succeeding incredibly powerful and real," say Maddock and Viton, who say the non-believers in a firm have a "cancerous effect" on success.

The last unwanted group, the Know-It-Alls have seen it all before and know why it can't work.

"The best innovators are learners, not knowers," they argue. 

"Unfortunately, it is often the smartest, most-seasoned employee who eventually becomes expert in using his or her knowledge to explain why things are impossible rather than possible."

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