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China's economic growth spills over to New Zealand: Treasury (2)

(Xinhua)

18:09, July 16, 2013

The second paper, The Outlook for China's Growth and its Impact on New Zealand Exports, forecast China would "remain strong relative to New Zealand's other trading partners" as its growth slowed over the next decade.

"The slowing export and investment growth is likely to lead to lower growth in China's demand for hard commodities, although the ongoing processes of industrialization and urbanization will continue to support this demand," it said.

"Dairy and meat consumption per capita generally grow as incomes increase. In particular, consumption of skim milk powder and cheese are expected to grow significantly in the next decade, keeping prices for these products high."

The third paper, China's recent growth and its impact on New Zealand's economy, outlined how rising Chinese demand had helped New Zealand's forestry and dairy sectors outperform the rest of the economy since 2008.

The two sectors had contributed 2.1 percentage points to the 4. 1-percent real GDP growth, but if they had grown at the same rate as the rest of the economy, they would have contributed only 0.2 percentage points, it said.

"This effect has helped the economy recover from the GFC ( global financial crisis) and the high terms of trade, partly resulting from Chinese demand, have boosted incomes over this period."


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