Gross Domestic Product: March 2011 quarter – Media Release

Additional analysis of gross domestic product (GDP) after the February 2011 earthquake showed that GDP was accurately measured at the national level, Statistics New Zealand said today. GDP is New Zealand's official measure of economic growth.

The 22 February earthquake was centred 10 kilometres southeast of the centre of Christchurch. While many businesses suffered major damage and remain closed, others were either unaffected or were able to resume business (some from different premises) soon after the earthquake. Most businesses in the region will have been affected by the earthquake, but the size and duration of this effect will vary considerably.

"Given the earthquakes in Christchurch, we wanted to understand the degree to which activity lost in some industries was replaced by activity in different industries or in nearby locations," national accounts manager Rachael Milicich said. "Our investigations have given us confidence that our GDP statistics accurately measure economic activity at a national level."

Alternative data sources for some components of GDP were investigated and analysed for the March 2011 quarter. For more on the economic impact of the 22 February earthquake, see Impact of the Canterbury earthquakes on New Zealand's gross domestic product.

Additional data was sought from nearly 800 Canterbury businesses on the value of their stock lost in the earthquake. This information was critical to understanding the changes in inventories in the economy this quarter. Inventory losses due to the earthquake were removed from the calculation of GDP – to reflect inventory changes due to economic factors only.

Some economic facts about the 22 February 2011 earthquake:

The commercial property damaged in Christchurch is less than 1 percent of all commercial property in New Zealand.

There are approximately 1.6 million houses in New Zealand. The 5,100 houses currently in the 'red zone' represent 0.3 percent of this total, so keeping these in the calculation of GDP has no significant impact on economic activity.

The Canterbury region accounted for around 12 percent of New Zealand's GDP in 2003.

Most of the 500 large businesses that Statistics NZ contacted continued operating after the earthquake – many from their usual premises, others from new temporary or permanent locations. Only a few ceased operation.

"Statistics New Zealand thanks all respondents," Mrs Milicich said. "We are particularly grateful to those in the Canterbury region who provided additional information on the effects of the 22 February earthquake."

Geoff Bascand 14 July 2011 Government Statistician

END

For media enquiries contact:

Jason Attewell

Wellington 04 931 4600

Email: info@stats.govt.nz