Findings from a detailed audience survey conducted by the Southern Lakes Festival of Colour emphasise the enduring popularity of the biennial celebration of art, music, theatre and conversation as well as the important economic benefit it brings to the region.

The online questionnaire asked all ticket buyers to rate each performance they attended and polled responses on topics including how many nights they stayed during the festival, how much they spent on travel and accommodation, the friendliness of staff and volunteers and what motivated them to attend.

The average score for overall satisfaction with the festival was 9.1/10 (with 10 being extremely satisfied) and overall value for money was rated 8.8/10.

When asked about their favourite performances, festivalgoers rated Michael Houstoun’s Beethoven sonatas, early settlers play On the Upside Down of the World, poetry and song from Bill Manhire, Hannah Griffin and Norman Meehan plus Lloyd Geering’s Aspiring Conversations session the highest.

More than half of all respondents would like to see more international artists with a preference for comedy, dance and theatre.

The average spend per person while away from home was $411. Taken together with total guest nights during the festival (53% of respondents stayed in the region between three and seven nights), this represents a significant off-season boost to the Southern Lakes economy.

At the same time as releasing the survey findings, festival organisers are also finalising end of year accounts and provisionally report a small operating profit that will be carried over to invest in future years. They also confirm a donation of more than $7,000 to Wanaka Rotary as a result of ticket sales for the festival’s Art at Home tour. This will be used to fund a local sculptural installation.

Festival director, Philip Tremewan said this year’s festival had been a wonderful success and thanked the audience, sponsors, volunteers and the management team.

“We’re delighted to report record tickets sales, more people staying longer and spending more in the region, plus a successful community programme with free events, thousands raised for Rotary and taking our schoolfest to more than 2,000 children from Makarora to Queenstown,” he said.

“We’re very pleased with the audience feedback which is a testament to the fantastic support we receive from sponsors and the local community. We’re proud of what we achieved this year but certainly won’t be resting on our laurels. The team is pushing ahead with exciting new ideas to make the festival better and brighter than ever.”

As in previous years, festivalgoers this year were predominantly female (78%) but there was an increase in the number of younger attendees with 18% under 40 (10% in 2011).

Mr Tremewan said this was a result of a varied programme with included late night shows like Adam Page and Aaron Tokona as well as performances like Tracing Hamlet which included cast and crew members drawn from the local community.

“We always strive to find a good balance between shows that will be obvious crowd pleasers and those we know will challenge and surprise audiences,” he said.

“A great example is On the Upside Down of the World. Word of mouth about this stunning, one-woman performance spread like wildfire leading to an extra night and full houses leaving Luggate Memorial Hall absolutely mesmerised.”

Philip added the festival board was considering several topics raised in the survey including creating a dedicated dancing area in front of the stage for some music acts, how to include more community events alongside the ticketed programme and how to build on the growing popularity of the festival’s Queenstown programme.

The 2013 Southern Lakes Festival of Colour ran from 16-21 April, supported by Central Lakes Trust, the Community Trust of Otago, Creative New Zealand and Aurora Energy. For further information visit www.festivalofcolour.co.nz.

The latest regional economic update report provides a useful summary of how well the regions are performing, but once again it shows how poorly we are at taking ‘game changing’ decisions to get action on the big issues.

With reference to the section on Auckland, Michael Barnett, head of the Auckland Chamber of Commerce, noted that the report claimed that the government and Auckland Council “are working together” to:

• Improve infrastructure and urban amenities;
• Develop education and labour opportunities for Auckland’s youth and migrant populations; and,
• Help the region become more innovative and export driven.

“Here is yet another report setting out Auckland’s growth agenda, but pulling its punch when it comes to spelling out the urgency of decisions that need to be made on Auckland’s big issues,” said Mr Barnett.

For the Chamber and to give the business community some certainty that we are moving past the global financial crises into a period of sustained growth, there are four big game changing announcements that are needed NOW:

• A 'game change' housing action programme target to identify 30,000 – 40,000 new sites in 2013-14 – to show a real response to the need for 13,000 new homes a year against the fact we are only building about 4000 new units a year;
• Completed business cases for seeking the funding to build the AMETI-East/West Link (critical to Auckland’s freight sector going forward) and Central Rail Link by 2021 – given both projects are substantially unfunded yet have a ‘highest priority’ ranking in the Auckland Plan.
• A confirmed agenda to finalise the Unitary Plan in a way that enables accelerated delivery of Auckland’s/Government’s growth plans.
• A confirmation that the International Convention Centre will be built ASAP – given the case for the Centre was made 10 years ago, and with SkyCity offering the $700 million needed to build, “we have run out of excuses for the lack of action,” said Mr Barnett.

Shoppers in New Zealand spent more using debit and credit cards in February 2013, Statistics New Zealand said today.

When adjusted for seasonal effects, the value of electronic card spending in the retail industries increased 0.8 percent in February 2013. This is the fifth consecutive monthly increase, and the largest since August 2012.

“There was increased spending in half of the retail industries in February,” industry and labour statistics manager Blair Cardno said.

"Most of this extra spending was on durables and consumables. Fuel was the only industry where there was a notable fall in spending."

The largest retail movements were:

• durables, up 1.4 percent ($15 million)
• fuel, down 1.5 percent ($10 million)
• consumables, up 0.6 percent ($9 million).

The durables industry includes furniture, hardware, and appliance retailing. The consumables industry includes food and liquor retailing.

Core retail (which excludes the motor vehicle-related industries) increased 0.7 percent in February 2013.
The total value of electronic card spending increased 0.8 percent.

Trends for the value of transactions in the total, retail, and core retail series have all generally been positive since these series began in October 2002. For each series, the rate of increase has strengthened in recent months.
In actual (unadjusted) terms, there were 101 million transactions in February 2013, with an average value of $54. The total amount spent across all transactions was $5.4 billion.

See also:
Electronic Card Transactions: February 2013  –  Information release

Mayor Alistair Sowman has asked Hon Gerry Brownlee, Minister of Transport, to release a report prepared by Covec Limited on the likely economic impacts on Marlborough of a new ferry terminal at Clifford Bay.

‘I am concerned that the Government has underestimated the economic impact of a move to Clifford Bay on the Picton economy in particular. There seems to be an assumption within Government that Picton will be able to transform itself into a Queenstown of The Top of the South. However Picton has to rely on a summer tourism season only and Marlborough lacks critical infrastructure such as an international airport compared to Queenstown.’ Says Mayor Sowman

Council is holding public meetings on 11 and 12 February to discuss the impact of Clifford Bay on the Region.

The Covec Report would be a useful resource for these meetings. Feedback from the meetings will be collated into a report for Council which will also be forwarded to the Government.

Economic activity, as measured by gross domestic product (GDP), was up 0.2 percent in the September 2012 quarter, Statistics New Zealand said today. This growth follows revised growth of 0.3 percent in the June 2012 quarter.

The main movements by industry this quarter were:

• construction (up 4.5 percent), due to increases in residential and non-residential building, with Canterbury featuring in both
• manufacturing (down 1.1 percent), due to decreases in metal product and food and beverage manufacturing
• agriculture (down 2.8 percent), falling this quarter after higher than usual growth in the first six months of the year.

"The growth in the latest quarter was driven by construction," national accounts manager Rachael Milicich said.

Economic activity was up 2.5 percent for the year ended September 2012. Compared with the September 2011 quarter, economic activity was 2.0 percent higher in the September 2012 quarter.

The expenditure measure of GDP was up 0.2 percent in the September 2012 quarter. The main features of this growth were:

• Household consumption expenditure, which measures the volume of spending by New Zealand households, was flat this quarter (0.0 percent).
• Investment in fixed assets (down 1.8 percent). Increased investment in residential and non-residential buildings was offset by a large decline in investment in plant, machinery, and equipment.
• Exports of goods and services (up 4.0 percent), mainly driven by a 27.7 percent increase in the volume of dairy product exports.

The size of the economy (in current prices) was $208 billion for the year ended September 2012.

See also:  Gross Domestic Product: September 2012 quarter  –  Information release

The economy remains on track for moderate growth over the next few years, despite growth predictably easing a little in the September quarter, Finance Minister Bill English says.

Gross domestic product grew 0.2 per cent in the three months to 30 September. This took annual growth – from the September quarter 2011 to the September quarter 2012 - to 2 per cent, after revisions by Statistics New Zealand to reflect extra data.

“After coming off a good growing season and a strong year for agriculture, other indicators had already pointed to a slightly softer performance in the third quarter,” Mr English says.

“However, there are signs that the pace of growth has picked up in recent months, with rising consumer and business confidence and a further strengthening of construction activity.

“We shouldn’t get distracted by the quarterly movements, particularly with the global environment remaining uncertain. What’s important is that the economy is on track for 2 per cent-plus growth over the next few years - and that’s the focus of the Government’s programme to increase productivity and competitiveness.

“We’re also taking many concrete steps through the Business Growth Agenda to help support businesses in creating jobs. The unemployment rate is too high and this will be a particular focus for the Government in 2013.

“Despite global headwinds, New Zealand is performing better than many other countries. We’re seeing positive signs through higher savings, households and businesses paying down debt, and interest rates and inflation remaining low.”

The Government’s economic plan to deliver a faster-growing economy, more jobs and a return to surplus remains on track, despite ongoing uncertainty in many parts of the world, Finance Minister Bill English says.

Issuing the Half-Year Economic and Fiscal Update today, along with the Government’s Budget Policy Statement, he says Budget 2013 will focus on continuing to implement this plan.

“We’ve set four main priorities for this term. “They include returning to surplus and reducing debt; pushing ahead with a wide-ranging programme of microeconomic reforms to create a more productive and competitive economy; driving better results from public services; and supporting the rebuilding of Christchurch.

“This programme is helping New Zealanders and their families to get ahead, encouraging personal responsibility and rewarding people for hard work and enterprise.”

The Half-Year Update forecasts the Government posting a modest surplus of $66 million in 2014/15 – down from the $197 million surplus forecast in Budget 2012. It also shows net core Crown debt peaking below 30 per cent of GDP.

“Thereafter, surpluses are forecast to increase and debt is forecast to fall,” Mr English says. “Continued control over spending has allowed the Government to remain on track to surplus, despite the impact on revenue of more difficult global conditions.”

Over each of the next five years, economic growth is forecast to average 2.5 per cent, together with increasing numbers of New Zealanders in employment and a falling unemployment rate.

“The global economic environment remains uncertain and this makes it even more important to maintain clear and credible fiscal settings,” Mr English says.

“This is a time for sensible and responsible policy – not for untried economic experiments. “Budget 2013 will confirm the Government’s commitment to responsible long-term fiscal management.

“This will require restraint well beyond the surplus target of 2014/15, so we can pay down debt and build a buffer against the next global shock, while at the same time resuming payments to the New Zealand Superannuation Fund and targeting investment at priority public services.

“At the same time as getting its own finances in order, the Government is continuing to address New Zealand’s significant economic challenges, including a sustained rebalancing towards the internationally competitive sectors of the economy.

“A broad range of targeted microeconomic reforms currently underway through the Government’s Business Growth Agenda will help to lift New Zealand’s productivity and competitiveness.”

Looking ahead, the European sovereign debt crisis and ongoing fiscal debt problems in the United States are risks to the global recovery. Downgraded forecasts of global growth have been factored into the Half-Year Update.

“Compared to many other countries, the New Zealand economy is in good shape,” Mr English says. “Despite our growth forecasts being slightly weaker than in Budget 2012, New Zealand is expected to grow more strongly over the next four years than the Euro area, the United Kingdom, Japan and Canada.

“New Zealand has a number of positive opportunities over the next decade, including strong and growing trade and investment links with Asia, elevated terms of trade and the Christchurch rebuild – which is expected to contribute 0.7 per cent to annual growth over the next few years.

“We’re in a strong position to translate those opportunities into more jobs, higher incomes and better living standards for New Zealand families. “The Government’s economic and fiscal programme is aimed squarely at ensuring this happens.”

Half-Year Economic and Fiscal Update and 2013 Budget Policy Statement available at:
http://www.treasury.govt.nz/government/forecasts

http://www.youtube.com/watch?feature=player_embedded&v=mbuCts1pFlI

Related Documents

HYEFU Final Presentation (pdf 146.03 KB)

Banks, mass debt, and monetary reform – the big picture goes public.
This is an email newsletter about money. About banks, and about debt. About how our money supply is currently created by banks “out of thin air” as interest-bearing debt - except for the very small proportion of money that is distributed as notes and coins. It's about why we, as a country, need to take this huge and nonsensical privilege away from the privately-owned banks – operating primarily in their own best interests - and swap to a logical system in which our government creates and controls 100% of our national money supply and spends and lends it into the economy - making effective use of 100% state-owned banks - for the benefit of our country and its people as a whole.

Why would a government delegate the power to create - and to a large extent control - its national money supply to profit-driven, private companies, thereby putting itself in the bizarre position of having to borrow, at interest, money it could simply have created itself, debt-free?

Why wouldn't a country want a network of 100% state-owned banks – recognising, and harnessed to, the needs of the people, the greater good of the country – channelling profits from lending not into private pockets but into government accounts to be made available for public spending?

These two questions are not new. Down through the centuries, there has been heated political and public debate, mass protest movements, and wars fought over who gets to issue and control money. 100% state-issued money supplies, 100% state-owned banks – these two models are neither new or radical – right now and also looking back down through history, we can point to successfully implemented systems; we can see the obvious benefits. What is new, what is strange and hard to fathom, is the comparative silence. The drying up of the public debate about money supply and about banking in recent history.

This issue of who creates and controls the money supply deeply affects the everyday lives of you and I, and everyone we know. It impacts on our communities, and on communities around the world. It impacts on resources - who owns them, who gets to use them, and whether they are used sustainably and ethically. It shapes our individual lives and it shapes our world as a whole. And yet most people know little or nothing about how money is created and controlled. About how 'moneypower' is created from our Money=Debt system. A system in which No Debt = No Money Supply. A system which actually requires us, as a population, to be in debt in order for there to be money in circulation. A system in which if we, as a population, paid off all our debt and started saving – as we are constantly being exhorted to do - the national money supply would dry up.

This is not a 30-second “sound-bite” story, but it is an incredibly important one.

If you are concerned about the cost of the Christchurch rebuild (around $4.5 billion of government spending committed so far), about sell-offs of wealth-creating state-owned or council-owned assets into private ownership, about losing New Zealand land to foreign ownership, about unaffordable housing and ever-increasing council rates, about child poverty and rising student debt and what this means for the future lives of young people, about retirement income and good care of the elderly, about having high quality education and health care available to everyone, about providing money for research and development, about reducing unemployment and providing good working conditions, about caring for our natural environment – our precious native habitats, about having good infrastructure nation-wide, about supporting a vibrant cultural life in New Zealand, about reinstating a non-commercial public-service television channel, and about providing everything else that's needed for a stable, caring, prosperous and out-reaching society, then this issue of the national money supply – the private bankers gains and our collective losses – is something you'll want to know about.

If you're sick of hearing about the need to embrace “austerity measures” because of the global debt crisis, while private banks have received massive bail-outs, and while the global casino continues to stay open for the big-time money-junkies, read on. Then take the time to listen to and watch some on-line interviews and documentaries.

(Scroll down for the website links of on-line video and audio interviews, and documentaries - all available to stream for free.)

There's plenty of light at the end of the dark economic tunnel, the debt-tunnel, if we make some much-needed changes to our underlying economic structures. And there are plenty of thinkers and leaders – including reform-advocating economists, academics, journalists, authors, film-makers, political leaders, and former high-flying financial sector insiders turned whistle-blowers - who have paved the way in the past or who are leading the way today on this issue.

And an International Monetary Fund (IMF) report has come out recently that gives a big fat tick to getting rid of bank-created debt-money and replacing it with government-created debt-free money. This report potentially represents a huge turnaround in IMF thinking; a belated recognition that the current debt-mate situation (to borrow from chess) is globally unworkable – no way forward, no way back - and it's time to tip the board over and start again with fresh strategies. (Learn more about this IMF report at: http://www.positivemoney.org.uk/2012/08/imf-working-paper-offers-supports-full-reserve-banking/ )
The monetary reform debate has well and truly started up again. It's a rising international tide of informed opinion with a strong history behind it, and a wave of new books, films, interviews, seminars etc. in the forefront. It is a debate that is not easily dismissed by anyone with half a brain and it seems to be reaching the ears of some key decision makers. So there's good reason to feel optimistic and empowered as you read through this newsletter and check out the audio and video links, even as you see and hear things that might shock or anger you.

Unlike in the USA, where the so-called “Federal Reserve” is actually privately-owned and itself holds trillions of dollars of US government debt, we here in New Zealand – with our Reserve Bank already an arm of government and with Kiwibank well established (although currently not 100% state-owned) – are in a good position to jump-start a better economic future, with monetary reform as the logical first step.

Banks create money “out of thin air” with a simple computer entry each time they make a loan to a customer. This newly conjured up interest-bearing “debt-money” (which could be, say, a mortgage loan or an overdraft or credit card debt) has not been “earned” in any way by the banks and is backed by only a minimal or “fractional” percentage of actual bank assets held in reserve. (Hence the government guarantees, and the bail-outs when these privately-owned businesses face self-inflicted insolvency). The massive privilege this “fractional reserve” banking system bestows on private banks is at the centre of the call for monetary reform. It has been the pumping heart of a Western financial system that has increasingly put more and more 'moneypower' into the hands of fewer and fewer people – and hence more and more political power, to the detriment of people and planet - until we have now reached a situation which is globally unsustainable, a breakdown situation. Along the way, as one American speaker calling for urgent monetary reform puts it: “...millions have died, billions have been harmed, and trillions have been looted...”

The huge problems created because of the use, and misuse, of the “fractional reserve” system of creating a debt-based money supply - and the obvious solutions to these problems - are right there in front of our eyes but are not clearly visible to the vast majority of us. Most of us just don't have – have never been given - the knowledge to make the connections between this system and the current global financial crisis. We don't know how it links to the cyclic boom/bust economy, or even to our personal economic circumstances. But people are now gaining that knowledge.

This newsletter is about giving New Zealanders a “starter-kit” of information - to help join the dots and reveal the big picture. To bring the issues into sharper focus so people can see what's really been going on and what needs to be changed, by us, the people, using our voices.

Please send this newsletter to your family, to your friends, to your colleagues, to all your networks etc. Send it with your name and greeting in the subject line so it doesn't get trashed as junk mail. Share what you are learning. Add your voice to the call for positive reform in the way our money supply is created and controlled, and encourage those you know to do the same. Help this important information to go right around New Zealand as fast as possible. Help get more people in New Zealand thinking, and talking, and questioning - taking a good, hard look at this issue of money creation and control, of 'moneypower', in the past, right now, and into the future - and calling on our political representatives to make the policy changes that will provide a much better future for New Zealand. A richer future. Literally. And a fairer and more sustainable future.

New Zealand is a small country with a small population but we can certainly be in the forefront of an international change for the better. We can take a stand. We've done it before – think about women's suffrage (the first nation in the world to give women the vote), our anti-apartheid stand, and our anti-nuclear stand. We can do it again. We can lift the heavy yoke of debt-money off of our shoulders. We can say no to the bankers, and yes to the people of Aotearoa/ New Zealand.

By Sam Coxhead of www.directfx.co.nz

Market Overview
Last week saw a continuation of the major themes that have dominated the wider financial markets for 2012. Uncertainty in Europe looks to be re-emerging as political instability in Italy pushes debt funding rates higher for the non Franco-German governments. The major central banks look to continue their efforts to debase the value of their currencies. Expect further quantitative easing (QE: essentially the electronic printing of money, to stimulate economic growth) from the US FED this week, the Bank of Japan (BOJ) next week, the Bank of England (BOE) next year, and a lower cash rate from the European Central Bank (ECB) in the coming months. The fiscal negotiations are on going in the US. The lack of progress is starting to impact  in the economy as evidence of lower investment and falling consumer sentiment emerges. The improved outlook in China has continued and this bodes well for intra Asian trade in particular. The Australian and New Zealand dollars remain in demand as they look like finishing 2012 towards the upper end of their well established ranges. Conceivably the direction less nature of the foreign exchange markets will continue into the opening months of 2013, as the opposing forces of European/US uncertainty and the massive stimulatory efforts from the central banks, continue to battle for the upper hand.

Australia
The last week has been a very busy and interesting one for the Australian economy. Building approval and retail sales numbers came in below analyst’s expectations. But the more important numbers of GDP and employment did not disappoint. GDP was close to expectation at a relatively healthy .5%, and the Australian employment market continued to show its strength with the unemployment rate falling from 5.4 to 5.2%. The Reserve Bank of Australia (RBA) matched expectations with a .25% cut to a new cash rate of 3.00%. However further policy accommodation is not guaranteed and the market will have to digest the future economic data as it comes to light, to create expectations of direction from the RBA. Adding to positive sentiment will be the latest monthly data from China over the weekend showing industrial production and retail sales both ahead of forecasts in November. This week little in the way of domestic focus in Australia, so expect the wider markets sentiment to provide the lead into the end of 2012. Next week the RBA monetary policy meeting minutes will be released on Tuesday, but should not be of material impact.

New Zealand
There was singular focus for the NZ economy last week. The first monetary policy statement from new RBNZ Governor Wheeler provided the expected unchanged cash rate. However, the very neutral and balanced statement certainly caught some of the market unaware. The scramble to buy NZ dollars following the statement was somewhat surprising. Investors looking for the RBNZ to signal a bias towards an interest rate easing, provided much of the initial demand.  Current RBNZ projections see an unchanged cash rate of 2.50% for all of 2013. This week sees limited focus coming from the domestic economy. Next week finally sees the release of the 3rd quarter current account and GDP numbers on Wednesday and Thursday respectively. These provide the remaining focus for the year. Also of note has been Fonterra increased pay out forecast. The 2012/13 season expectations are now lifted to the 5.50 NZD farm gate pay out. This pay out lift has been on the cards since the improved Global Dairy Trade auctions over the past few months, but should provide an increased boost to the economy none the less.

The United States
The mixed outlook continued in the US economy last week. With a dark back drop of stagnating fiscal cliff negotiations the data flow was decidedly mixed. Employment, services and factory orders numbers beat expectations, while consumer sentiment and manufacturing numbers underperformed. The FED look likely to roll over to a new program of monetary easing at this week’s monetary policy announcement. Also of interest this week will be retail sales numbers, inflation and industrial production numbers. The fiscal negotiations will also remain at the very fore front of market focus. Last week’s plummet in the consumer sentiment is just an indication of the destructive nature of the uncertainty this situation promotes. Expect further brinkmanship from all parties on this issue, to the detriment of the wider US, and global economies.

The United Kingdom
The mixture of good and bad news for the UK economy continued last week. Manufacturing numbers were positive, but the construction and services sector remain under pressure. Finance Minister Osbourne released the latest Treasury forecasts for growth. 2012 growth expectations have been lowered to -.1% from the previous +.8% forecast, and expectation for 2013 and 2014 have been revised down also. As expected the BOE left monetary policy unchanged at their meeting last week, although further stimulation cannot be ruled out in the first half of 2013. The BOE monetary policy meeting minutes next week will likely shed further light on this. This week sees a relatively quiet economic calendar with the employment numbers on Wednesday providing the primary focus.

Europe
It has been an intense last week in Europe. The economic data was again mixed with reasonable manufacturing numbers being tempered by worse than expected retail sales data. Spanish efforts to meet deficit targets look to be have been in vain, and this saw bond yield increase. The ECB left monetary policy unchanged for the time being, but the prospect of lower interest rates remains real as serious debate was had on this subject. The flair up in Italian politics over the weekend has further increased uncertainty. Anti-austerity policy backers are gaining momentum in the polls and interim PM Monti has vowed to resign and cause early elections once his budget policies are passed early in the new year. Should Monti decide not to run for office, the increased uncertainty about the austerity program would likely see increasing bond yields for Italy, at a time that these could cause some major damage. It is reasonable to expect this to be major theme in 2013. Economic sentiment numbers, inflation and further manufacturing data provide the data focus for this week.

Japan
The build up to the 16 December elections remains intense in Japan. The YEN has remained under pressure for the most part as the LDP continue to lead the polls. Adding to the YEN weakness is speculation the BOJ will again add further stimulation to the economy at next week’s meeting. Reuters have anticipated the stimulation will be to the tune of ten trillion YEN. Yesterday saw the final GDP numbers for the 3rd quarter confirmed at -.9%, and interestingly with the second quarter revised down also, the economy finds itself in its fifth recession in the last 15 years. The remainder of the week sees the monthly core-machinery and manufacturing results provide the focus, albeit limited market reaction expected ahead of the election in the weekend.

Canada
The BOC left monetary policy unchanged as expected last week. It maintains a mild hiking bias with language such as “some modest withdrawal of stimulus will likely be required”. The economic data was mixed with construction numbers jumping, but the manufacturing index under performing. Of note has been the Government giving the green light for the Chinese investment funds to make a circa 15 billion investment in the Nexen iron sands company. This decision is undoubtedly positive for the CAD, as it removes a significant uncertainty for CAD demand. Next week is a busy one for Canadian economic news with retail sales, inflation and GDP all due for release.

Orinially posted at www.directfx.co.nz

Canterbury Earthquake Recovery Minister Gerry Brownlee has highlighted 20 key projects in the Economic Recovery Programme for Greater Christchurch, which was launched today.

Developed by the Canterbury Earthquake Recovery Authority (CERA) and Ministry for Business, Innovation and Employment (MBIE), the programme lays out a roadmap for economic recovery in the region.

“This has been a thoroughly collaborative process between CERA and MBIE in partnership with local government and the business sector,” Mr Brownlee says.

“Public and private investment in the 20 projects – identified as the most important for the recovery – is estimated at $20 to $30 billion.

“This is a once-in-a-lifetime opportunity for Canterbury to create a new, better and enduring business environment.”

Economic Development Minister Steven Joyce says business disruption following the quakes was significant, but the sector also showed a resilience which provides great confidence in Canterbury becoming a more productive economic engine for the country.

“The Canterbury business community is in good heart and is ready to harness the opportunity presented by the rebuild.

“Every week we’re seeing examples of innovation, focus and commitment to making the Canterbury economy strong,” Mr Joyce says.

Some of the 20 projects, such the anchor developments in the new CBD, titled Christchurch Central Recovery, are already in progress.  Others identify new opportunities to be developed and monitored.

Mr Brownlee says the 20 projects have varying timeframes through to 2016, by which time some will be completed and others will transition to partners such as regional economic development agencies.

CERA is also compiling the monthly Canterbury Economic Recovery Dashboard to provide a snapshot of how the region’s recovery is progressing.

“The latest economic data shows a continuation of recent positive trends which have revealed Canterbury to be the fastest growing region in New Zealand,” Mr Brownlee says.

“Unemployment in Canterbury has fallen to 5.2 per cent, construction activity continues to accelerate – with building consents for new residential dwellings in Canterbury increasing 80 per cent in the 12 months to September – and growth in consumer spending over the past year is the highest of any region in New Zealand.”

The full Economic Recovery Programme and Economic Recovery Dashboard can be viewed at www.cera.govt.nz

New Zealand is “surprisingly well positioned for 2050”, according to the executive editor of The Economist Daniel Franklin.

During the keynote address at the new New Zealand Forum, an event organised by Massey University and Westpac, Dr Franklin outlined some of the mega-trends shaping the future of the world and the implications and opportunities for New Zealand.

He identified population growth as one of the key drivers of change, as well as the growth of Asia’s economy.

“New Zealand is surprisingly well positioned for the world in 2050 for a number of reasons. It’s close to Asia where a lot of the economic action is going to be, and it has a relatively big agricultural sector in a world that will need to feed nine billion people,” Dr Franklin says.

“The implications are even more dramatic than the actual population numbers suggest. The world’s population is not only increasing but also getting richer… so we will need to produce something like 70 per cent more food.”

Dr Franklin believes New Zealand’s agri-food expertise means it should be in a position to not only produce valuable food products, but also export its agri-food technology so other countries can increase their own food output.

“There maybe some complications due to climate change,” he acknowledges, “but New Zealand has a relatively enviable environment so it also raises the issues of managing that great heritage well.”

The fact that English is one of New Zealand’s official languages will also be to its advantage, Franklin says.

“English is probably going to continue to be the main language spoken, despite the rise of China, and New Zealand’s links through the Commonwealth to Africa will be important. There is going to be tremendous population growth in Africa and it will be a very fast growing part of the world’s economy.”

Dr Franklin, who describes himself as “relatively optimistic” about the future, says with good management and the right policies, there is no reason that New Zealand will not come through the current period of wrenching change in good shape.

“My main piece of advice for NZ is to stay open – to trade, to other people and cultures, and to ideas. There’s always the temptation when things are changing very fast around you to close up. New Zealand needs to compete in the world of ideas and the more open New Zealand is, the more likely it is going to be able to take advantage of the opportunities.”

Massey University Vice-Chancellor Steve Maharey says the University organised the forum with Westpac to create a stronger focus on New Zealand’s future. He believes the University is already responding to the future needs of New Zealand and the world, particularly in terms of agri-food research and education.

“New Zealand can’t feed nine billion people, but we can provide some of the thinking and knowledge it will take to do this, at the same time moving our products up the value chain.”

Westpac's managing director private, wealth and insurance Simon Power says: "Thinking long term is exactly what we as a country need to be doing, and having someone of Daniel Franklin's stature to assist with leading that discussion is an extraordinary opportunity. Westpac is proud to back any forum that gets us focused on what those opportunities may be."

A video of the forum presentations and Q&A session can be viewed at: http://www.massey.ac.nz/massey/about-massey/events/new-nz-forum/en/watch-live.cfm,

By Sam Coxhead of www.directfx.co.nz 

Market Overview:

Last week saw relatively tame price action in the foreign exchange markets for the most part. The market has expected a positive result on the Greek funding issue, and has limited expectations for progress from the US fiscal negotiations. In the coming weeks the markets can expect lower levels of liquidity as the holiday season and end of year approaches. With the Japanese elections and the on going fiscal talks in the US, these lower levels of liquidity will likely lead to increasing levels of volatility. This week’s central bank extravaganza sees the final monetary policy announcements for the year in New Zealand, Australia, Canada, the United Kingdom and Europe. The most likely interest rate move is a 25 basis point easing from the Reserve Bank of Australia (RBA) at tomorrow’s announcement.

Australia
Last week was relatively quiet in Australia. Construction numbers were mixed, but the new home sales numbers were better than expected. The much anticipated private capital expenditure numbers were better than expected, albeit down from the 2nd quarter. Of interest were the mining investment numbers which held up reasonably well but point towards a lower than previously expected peak, and furthers debate on the possibility of the easing from the RBA at tomorrow’s monetary policy announcement. Various commentators have pointed that if the RBA waits until the next meeting to cut the official cash rate, the gap between easing’s will have been four months, and the lower risk option would be to put insurance in place now. The market pricing is marginally in favour of a move lower to a cash rate of 3.00%. Following today’s flat 3rd quarter retail sales, we have building approvals, GDP and employment all to come this week. There is potential for volatility and this should be kept in mind for those considering transfers involving Australian dollars.

New Zealand
There has been very little in the way of local economic news in New Zealand throughout the course of the last week. Thursday’s ANZ Business Confidence survey revealed an impressive increase to 26.4 from the previous 17.2 level. This second tier data is the last to come ahead of the RBNZ monetary policy decision this Thursday. It seems very unlikely that we will see a cut to the 2.50% cash rate at this meeting. The 3rd quarter data has been weak, but consideration of more up to date indicators point towards the 3rd quarter being a tough one for activity. The 4th quarter certainly looks and anecdotally feels like a different proposition. This will likely see the RBNZ take further time to digest the current data, and leave any prospect of easing to the cash rate for the early months of 2013, if required at all.

United States
Volatility in the wider market is likely to increase in the coming weeks. This increased volatility will be a function of the uncertainty around the US fiscal negotiations and lower levels of liquidity over the Christmas holiday/end of quarter period. Last week saw some reasonably positive data with durable goods orders and consumer sentiment data demonstrably beating expectations. The new home sales numbers disappointed on Wednesday, but was somewhat discounted by the price action. The second read of preliminary Q3 GDP numbers overnight revealed a 2.7% rise in activity against an expectation of a 2.8%. Friday’s lower than expected personal spending numbers point towards softer than forecast GDP growth. This saw a mixed reaction, as the positive sentiment could not be maintained. The fiscal negotiations remain the underlying focus as they will be of direct impact to the level of economic growth in 2013. As the end of the year approaches the FED are likely to get increasingly uncomfortable with any lack of progress, which anecdotally sees lower business investment levels ahead of a positive outcome. FED speeches now commonly point towards the current low interest rate environment remaining in place until the unemployment rate hits a target of 6.5%. Further stimulation cannot be discounted, especially if 2013 growth is adversely affected by the inability of the President and the Republican congress to find a compromise on fiscal issues.

Europe
European finance ministers finally agreed to award the next tranche of bailout funds to Greece last week. An easing of conditions to be met will also apply to those loans to Ireland and Portugal. Lower than expected German inflationary pressure has again increased the calls for an easing from the ECB at Thursday’s monetary policy announcement. This does seem unlikely , with further policy accommodation likely to come in early 2013. European unemployment was as expected at a large 11.7%. Spanish unemployment5 on Tuesday will be of note, with the focus undoubtedly shifting back to Spain in the short term.

United Kingdom
Revised UK GDP numbers were as expected at 1.0% for the 3rd quarter last week. Comments from Bank of England officials continue to talk of a protracted recovery, and the possibility of further quantitative easing in obvious attempts to cap any EURO inspired GBP appreciation. Of note this week was also the news that highly regarded current Bank of Canada Governor Mark Carney will take over the reins at the Bank of England (BOE) mid-way through 2013. Next week sees a busy calendar in the UK. Manufacturing, construction, services and trade balance numbers will come alongside the latest BOE monetary policy decision on Thursday. No change is expected to monetary policy at this meeting.

Japan
The frenzy of anticipation surrounding the Japanese war on deflation has increased again this past week. LDP party leader Abe openly calling for unlimited stimulation until inflation reaches 2.0%. In a Reuters article over the weekend, speculation again increased, with talk of a one off monetary injection of one trillion US dollars in an effort to weaken further the YEN. A number of different ideas are being discussed including the purchase of foreign bonds. Central to the upcoming election will be a increasingly shaky independence of the Bank of Japan (BOJ), with politicians quick to blame an apparent lack of BOJ pro activity for the current lack of economic growth and correspondingly high YEN.

Canada
Last week proved to be a mixed bag for the Canadian economy. Deputy Bank of Canada (BOC) Governor Murray commented that the economy was running close to potential and this would point toward an increased cash rate at some stage in 2013. Unfortunately the monthly GDP numbers show just .6% annualised growth for the 3rd quarter and this comes in materially lower than the expected .9% number. This week sees the BOC monetary policy statement on Tuesday, building permits and manufacturing numbers Thursday, and the latest employment numbers Friday. Expect no change from the BOC to monetary policy, but the accompanying statement will be of interest.

Major Announcements last week:

• Greece awarded its next tranche of bailout funds
• UK revised GDP as expected at 1.0%
• US Durable Goods 1.5% vs -.6% expected
• US Consumer Confidence 73.7 vs 73.1 expected
• ANZ NZ Business Confidence 26.4 vs 17.2 previous
• AU Private Capital Expenditure 2.8% vs 2.1% expected
• US Preliminary Q3 GDP 2.7% vs 2.8% expected
• Canadian GDP Oct 0.0 vs +.1% expected
• Chinese Manufacturing 50.6 vs 50.8 expected
• Australian Q3 Retail Sales 0.0 vs +.4% expected

Originally posted at www.directfx.co.nz.