The annual trade deficit for the year ending February 2017 was $3.8 billion, the largest since April 2009, according to a Statistics New Zealand report released today.
This trade deficit growth is exacerbated by the export of a large drilling platform in 2016, which reduced the annual trade deficit between February 2016 and January 2017. Drilling platforms, which can be worth hundreds of millions of dollars, are counted as imports when they arrive in New Zealand and exports when they leave, despite typically being leased for their duration in the country.
For the year ending February 2017, an 11 per cent rise in imports of vehicles, parts and accessories worth $828 million significantly offset the $1.28 billion drop in export values, and pushed the trade deficit up even further.
The $1.28 billion decrease includes a $475 million drop in ships, boats, and floating structures.
Other top import commodities, such as mechanical machinery and equipment, petroleum and products, and electrical machinery and equipment were either flat or in decline, making vehicles the standout import commodity for the February 2017 year.
Goods exports fell $232 million, or 5.5 per cent, in the month of February 2017, compared to the previous corresponding period. This is largely due to the export of the drilling platform in February 2016. Without the platform, goods exports showed little change, up $35 million or 0.9 per cent.
“There were mixed results for New Zealand’s other export commodities in February 2017,” international trade statistics senior manager Daria Kwon said. “Exports of dairy, meat, and fruit were up, but other primary produce exports, including fish, wool, and casein, were down compared with the same month of the previous year.”
Imports rose $154 million, or four percent, in the month of February 2017 to $4.024 billion. This was led by a $103 million increase, or 20 per cent, in vehicles, parts and accessories, and by a $106 million increase, or 32 per cent, in petroleum and products.
The monthly trade balance for February 2017 was a deficit of $18 million.