Strong rise in spending as rebuild begins
Signs that rebuild benefits are flowing beyond the construction sector are emerging, an index of Canterbury activity shows.
The ASB Cantometer is an index of activity in different sectors and a guide to the progress of the post-earthquake rebuild, not a measure of economic growth in Canterbury.
The index recorded a January "snapshot" reading of 0.5, up from 0.2 in December and 0.1 in November, when first published.
That was a strong lift in activity, ASB senior economist Nick Tuffley said, and indicated activity was now firmly above pre-quake levels.
Driving the increase in activity was the consumer-spending component of the index, which had lifted to +0.3 from -0.8.
A sharp increase in consumer confidence in the last three months of last year and a further increase in retail spending in the third quarter of last year, with spending growth outpacing that in the rest of the country, suggested economic activity in Christchurch was starting to broaden beyond construction, Tuffley said.
He said that as more money was spent on construction and more people were employed, other businesses were benefiting.
Canterbury Employers' Chamber of Commerce chief executive Peter Townsend told Radio New Zealand today that the Canterbury rebuild would "shield the region from any nationwide downturn".
"The Christchurch rebuild is having about a 1 per cent impact on our total GDP. That is enormous,'' he said.
''We know that the rebuild in Christchurch is between $30 billion and $40b. That is unprecedented.
"You're going to see prolonged economic activity."
Re:Start container mall director Paul Lonsdale said there was a noticeable increase in confidence among retailers as their customers were spending more confidently.
The mall had enjoyed a good summer and a very good December. Shoppers were a mix of tourists and locals.
Christchurch residents were initially hesitant about returning to shop in the central city but that had changed, with many more locals now visiting the mall.
Tourists were coming back in "good numbers".
A mention in Lonely Planet had been a big boost, Lonsdale said.
More generally in the city, retailers were feeling more positive as they were seeing the rebuild start to happen, he said.
The decline in seismic activity also helped.
"People are getting on with their lives. Overall, there is a lot of confidence with the rebuild going forward. Money from the rebuild is starting to flow through now," he said.
Small improvements in other areas of the Canterbury economy included a lift in permanent and long-term net migration, which was now positive, and a rise in car registrations.
Activity in the construction sector continued to rise, boosted by a further increase in the number of non-residential building consents issued. Housing demand continued to recover, with a pickup in house sales.
However, low levels of new listings could constrain the housing market recovery and the tight market continued to put upward pressure on house prices in the region.