Chamber confident growth will return
Southland's economic growth has stalled after at least five successive years of growth.
Statistics New Zealand figures released yesterday reveal the region's gross domestic product growth declined by 1.1 per cent for the year ending March 2013.
It is the first time Southland's GDP has decreased since 2007.
However, the negative growth was not expected to be a trend, the Southland Chamber of Commerce says.
Statistics New Zealand regional economic statistics manager Peter Gardiner said a decline in agriculture, specifically dairy farming, had put an end to successive years of plenty in Southland.
Between 2007 and 2012, the Southland economy was the second best performing economy behind Taranaki, he said.
Oil had barrelled along Taranaki's economic growth, while Southland had milked the dairy boom.
Sheep and beef farming and manufacturing had also been excellent contributors to Southland's GDP during the same period.
A decline in commodity prices and some effects of drought had hit the Southland economy, Mr Gardiner said.
Southland Chamber of Commerce president Sean Woodward said it was disappointing to have any negative growth but he was extremely confident the Southland economy was back on track.
"Conservatism from trading partners, uncertainty surrounding the Tiwai aluminium smelter and concern around business conditions had impacted the economy in what was a slow year in 2012-2013," Mr Woodward said.
However, the last half of 2013 and so far in 2014, economic activity and confidence was back up to 2008 levels, he said.
"I am very confident we will see a large increase again this year."
While the regional GDP may have decreased, Southland had the third highest GDP per capita in the country at $52,701.
Taranaki recorded the highest GDP per capita at $74,341, followed by Wellington at $57,941. Gisborne had the lowest GDP per capita at $34,472. The national average was $47,532.
Mr Woodward said the per capita GDP in Southland showed once again the region was "punching above its weight".
Agriculture, forestry and manufacturing were key drivers, with Southland being a producing rather than consuming economy, he said.
Economic confidence in Southland had returned on the back of stable interest rates and rural producers again doing well, Mr Woodward said.
Otago's GDP rose 1.5 per cent.
The South Island's contribution to the national GDP rose 1.2 percentage points, due to rebuilding in Christchurch and greater agriculture contributions from the West Coast and Southland.
New Zealand's total GDP was $211.6 billion in the year ended March 2013.
The North Island contributed 76.7 per cent to New Zealand's GDP, compared with 23.3 per cent from the South Island.
AT A GLANCE
Southland GDP $(million)
2007 - 3,550
2008 - 4,100
2009 - 4,258
2010 - 4,401
2011 - 4,734
2012 - 5,056
2013 - 5,001
GDP per capita per region 2013
Bay of Plenty $40,236
Hawke's Bay $39,035
West Coast $46,793
Source: Statistics New Zealand
The Southland Times