Surging dairy exports have helped New Zealand record its smallest current account deficit since 2010.
Statistics NZ says the current account gap was $NZ800 million ($A763.21 million) in the December 2013 quarter – down from $NZ2.5 billion in the previous three months.
It was the lowest deficit since March 2010.
“New Zealand exported record levels of dairy products this quarter, which drove the balance on goods and services to its highest-ever surplus,” balance of payments manager Jason Attewell said.
An increase in New Zealand’s investment income deficit partly offset the rise in exports and foreign-owned companies in New Zealand earned their highest profits in four years.
The annual current account deficit also fell, to $NZ7.5b (3.4 per cent of gross domestic product, or GDP) for the year ended December 2013, down from $NZ8.9b (4.1 per cent of GDP) for the year ended September 2013.
The seasonally-adjusted balance on goods and services for the December quarter was a surplus of $NZ1.8b – a $NZ1.9b turnaround from the September quarter deficit.
“A sharp rebound in export volumes, after the severe drought in early 2013, led to the strongest seasonally-adjusted goods balance on record,” said Michael Gordon, senior economist at Westpac Banking Corp.
New Zealand’s net international liabilities fell to $NZ147.6b, or 66.6 per cent of GDP, from $NZ149.5b, or 69.2 per cent, three months earlier.
Outstanding claims on overseas reinsurers for the Canterbury earthquakes were about $NZ5.9b as at December 31, down from nearly $NZ7b three months earlier.