Photo: 123RF
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The South Island continues to outpace the North in the national economic stakes.
For the second consecutive quarter, Otago and Canterbury have taken the top two spots as the best performing of 16 regional economies in ASB Bank's rankings for the final quarter of last year.
Chief economist Nick Tuffley said lower inflation and interest rates had not sparked the national economy last year, but the South Island regions were among the bright spots.
"The recent tourism increase has greatly boosted the Central Lakes region, contributing to Otago's leading position in retail trade and second in employment growth."
The two regions have held the top two economic spots for the past four years, and Tuffley said on current indications they would continue to lead the pack.
"The gradual recovery of tourist arrivals will be a key factor in Otago's growth. Meanwhile, the Fast-track Approvals Bill has facilitated several projects."
Strong performance from agriculture, notably meat and dairy, underpinned Canterbury's second placing backed by retail and house sales, with high export prices, and energy projects expected to sustain growth.
Tasman and Southland took third and fourth spots each helped by construction activity, and agriculture.
Big cities languishing
Auckland and Wellington languished in the bottom half of the table, with the capital city entrenched in second to bottom place, just ahead of Taranaki.
ASB said Auckland, ranked 11th, had a case of the economic blues, and apart from higher consumer spending the indicators were generally weak, including a "soggy" housing market, a fall in house building, and more people out of work.
"Auckland has some hefty hurdles to jump through to get growth, but we think it'll get there by the second half of the year."
For Wellington, its 15th placing was based on rising unemployment as government and companies tightened their belts, consumers remained downbeat, house prices fell, with some offset coming from commercial construction activity.
Tuffley said positive economic drivers nationally were expected to show through this year.
"Despite emerging uncertainties from external factors, there are signs of recovery across sectors as the impact of lower interest rates feeds through the economy. However, we expect a gradual recovery throughout 2025, rather than a swift turnaround."
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