Two-way trade tops $160 billion for the first time

trade stock image

Increased exports and imports helped push New Zealand’s two-way trade of goods and services to $160.7 billion for the year ended September 2018, up $16.7 billion from the year ended September 2017, Stats NZ said.

Two-way trade, which measures total exports plus imports between New Zealand and the rest of the world, surpassed $160 billion for the first time. “Trade is critical to New Zealand’s economy. The revenue New Zealand earns from selling goods and services overseas helps pay for the goods and services we import from other countries,” international statistics senior manager Peter Dolan said.

The value of New Zealand’s imports and exports has increased in the year ended September 2018, repeating a pattern generally seen in the past decade. Imports and exports reached new highs, with imports up $9.4 billion to $79.1 billion from 2017, and exports up $7.3 billion to $81.6 billion.

Travel services drive services exports

Services contributed 30 percent to New Zealand’s total exports in the year ended September 2018 ($24.6 billion), with travel being the largest contributor at 14 percent.

“The large travel components of New Zealand’s services exports reflect a large tourism sector,” Mr Dolan said. “Spending by visitors from China and Australia contributed more than $4 billion to the New Zealand economy in the year ended September 2018.”

Amongst our top five trading partners, the European Union was the destination with the highest proportion of services (40 percent), closely followed by the United States of America (37 percent) and Australia (35 percent). China and Japan had a lower proportion of exports that were services, at just over 20 percent each.

Between 2008 and 2018, services increased as a proportion of total exports for Australia, the European Union, and the United States of America, while they fell for China and Japan.

Proportion of service imports constant

While the value of goods and services imports has increased over time, the proportion of total imports between goods and services has remained relatively constant.

“Imports of services were almost 25 percent of total imports in 2018, the same proportion seen a decade earlier,” Mr Dolan said.

However, the proportion of services that New Zealand imports from our top five trading partners varies by country. In the year ended September 2018, services contributed just under half of the total imports received from Australia. At the other end of the spectrum, services contributed just over 5 percent of the imports New Zealand received from China and Japan.

The share of services increased between 2008 and 2018 for all of New Zealand’s top trading partners, except for Japan which decreased.

New Zealand’s top imports from Australia were travel and other business services.

“This likely reflects personal connections, transactions between businesses, and geographical proximity,” Mr Dolan said.

Source: Stats NZ

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