Kirisitiana Uluwai 
Minister for Finance Professor Biman Prasad and Prime Minister of New Zealand Chris Hipkins
New Zealand’s technical recession is no cause for alarm for Fiji yet.
Minister for Finance Professor Biman Prasad says because economies like New Zealand and Australia are large economies
New Zealand’s gross domestic product fell 0.1% in the first quarter, according to government data published last Thursday, as its central bank embarked on one of the most aggressive rate hike cycles in the world.
A technical recession is defined as two consecutive quarters of contraction.
Compared with a year ago, the economy grew 2.9% in the first quarter. Economists surveyed by Reuters expected New Zealand to mark a contraction of 0.1% quarter on quarter and growth of 2.6% year on year.
Prasad is confident that the New Zealand and Australian economies will remain significant sources of tourism revenue and remittances.
“It could have some impact depending on how long that recession continues. Right now, it’s purely technical. It doesn’t mean that New Zealand will end up in a major recession.”
A country enters a technical recession only when its gross domestic product (GDP) shrinks for two consecutive quarters. New Zealand has only narrowly met this criteria, with GDP down 0.1% in the March 2023 quarter after a 0.7% fall in the December 2022 quarter.
The economic downturn was exacerbated by the effects of extreme weather that hit the country through February and March, devastating some of New Zealand’s key fruit and vegetable-growing regions and causing extensive damage to the road network, analysts said.
Prasad says he is keeping an eye on the situation.
