Business booming but locals leaving

Last updated 12:58 19/03/2014

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Confidence in the Nelson region's economy is improving, but it needs to halt the outgoing tide of residents to secure its longer-term future, a new economic indicator report says.

The Nelson Regional Economic Development Agency's six-monthly regional economy report, released yesterday, says a summary of all the key indicators suggests that the economy is moving in the right direction in most respects.

But it did highlight one key area in which the region could do better, EDA chief executive Bill Findlater said.

"Nelson-Tasman is still experiencing net emigration, and this is an issue that needs attention if the region is to continue to thrive in the longer term."

The report showed that in terms of net migration as a proportion of the population, the region has fared worse than New Zealand as a whole every year since 2000.

The primary sector was the biggest driver of the estimated 4.6 per cent growth in the region's economy in the year to March 2013. Compared to the rest of the country, Nelson was much more specialised in primary production, the report said.

Horticulture was the region's largest employer, with around 2500 employees.

The EDA has always been a strong supporter of the proposed dam at Lee Valley, because of the risk of dwindling growth in primary production without an adequate water supply.

At a public meeting last week on options for water use in the future, the Tasman District Council said that without the proposed dam, water allocations and restrictions would be extreme by 2016.

Mr Findlater said the whole region benefited from increased production.

The volume of food exports through Port Nelson rebounded by 7 per cent in 2013, after falling by 5 per cent in 2012. Fruit exports increased 14 per cent.

A total of 421,187 tonnes of primary produce was exported through Port Nelson in 2013, of which 288,714 tonnes (69 per cent) was fruit. Foodstuffs exports increased marginally, but dairy and seafood exports fell slightly.

Port company chief executive Martin Byrne said that in general, there were some encouraging signs. Apple exports were starting to pick up, and fishing and log exports to China were doing well.

"We're cautiously optimistic," Mr Byrne said.

There was still adequate space for growth in cargo volumes through the port, despite the potential for changes to shipping in and out of Nelson, he said.

Maersk - the world's biggest container line - was on the brink of pulling out of Nelson in 2012 but was persuaded by major exporters and Port Nelson Ltd to continue its service. Maersk said then it would continue to serve the port "for the foreseeable future" but warned that this was not an open-ended guarantee.

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The EDA's report said that last year in Nelson city, the three largest industries were manufacturing, healthcare and social assistance, and the retail trade. Together, they accounted for 42 per cent of the area's GDP of $1.99 billion.

In Tasman district, the three largest industries were agriculture, forestry and fishing, manufacturing, and the retail trade. They accounted for 61 per cent of the district‘s GDP of $1.85b.

Measured on a rolling annual basis, retail sales in the region had been on an upward trend for the past two years, but they had yet to recover to the peak levels seen in mid-2008, the report said.

Long-time Nelson retailer David Waine, who owns Urban Beach in Trafalgar St, said that on the whole, things were improving, but retailing was still no match for the heyday of 2006-07. He had seen a drop in the number of overseas tourists at his store as the kiwi dollar strenthened, but sales figures from this summer were slightly ahead of last summer.

He said the loss of large events such as the Gathering dance festival was still being felt by retailers.

"On the whole, we're not going backwards, and things have improved over the last 18 months."

The report said more businesses across the region had gone under than had opened in the past four years.

In 2013, 90 new business were started for every 100 that closed.

Mr Findlater said the global economy appeared to have turned a corner, and looking at the strong growth in the wider New Zealand economy, 2014 promised to be "another good year".


The Nelson region grew rapidly in 2013:

Total GDP up 4.6 per cent, compared to 2.9 per cent nationally.

GDP per capita up 4.2 per cent, compared to 2.1 per cent nationally.

Employment growth was 1.5 per cent, compared to 0.2 per cent for the country as a whole.

Labour productivity up 3.1 per cent, compared to 2.7 per cent nationally.

Food exports through Port Nelson in 2013 were up 7 per cent on 2012.

Visitor nights: international up 3.6 per cent; domestic up 4.3 per cent.

- Nelson


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