New Zealand's two-speed economy poses election dilemma for ruling National party
SPY•New Zealand's uneven recovery, cost-of-living pressures and divergent regional economic performance are complicating the ruling National Party's campaign ahead of the November 7 election. Second-quarter retail spending rose 8.6% year over year on the South Island and 5.8% in Auckland and Wellington, while unemployment fell in the South Island and rose in the North Island.
1. Economic pressures shape campaign
New Zealand is struggling to fully emerge from recession as voters weigh the cost of living and the National Party's economic record ahead of the November 7 election. In Hutt South, part-time bus driver Liz Hartley said rising prices have left little money at the end of the week and that she plans to vote tactically against National incumbent Chris Bishop. Bishop said the government's economic plan was beginning to work and needed more time.
2. Regional divide
Tourism and higher agricultural exports have supported rural areas, particularly on the South Island. Second-quarter retail spending there was up 8.6% year over year, compared with 5.8% in Auckland and Wellington; unemployment fell 0.6 percentage points on the South Island and rose 0.7 points on the North Island. House prices were down almost 30% from their peak in Wellington, 24.7% in Auckland and 17% nationally.
3. Election outlook
Polls showed no clear path back to government for any potential coalition. National says fiscal restraint and infrastructure investment are laying the groundwork for stronger growth, while a left-wing coalition is proposing a larger government role to ease household pressures, support public services and address housing affordability.
