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Annual Report of the Treasury for the Year Ended 30 June 2013

Our Outcome Performance

Improved Economic Performance

New Zealand's average GDP per capita growth for the past six decades has been poorer than all other OECD countries. In order to maintain New Zealand's living standards we need to materially narrow the income gap between New Zealand and the most advanced economies (see page 14 for a graph comparing New Zealand's GDP per capita with other countries). New Zealand's economic growth performance relative to other countries is improving, with New Zealand's real GDP growth projected to exceed the aggregate OECD growth rate from 2012.

New Zealand real per capita GDP growth (production measure)
New Zealand real per capita GDP growth (production measure)   .
Source:  Statistics New Zealand

For a country of New Zealand's size, much of this growth will need to be driven by strong export performance as reflected in tradable sector growth, which is improving but still lags behind non-tradable sector real GDP growth.

New Zealand real tradable and non-tradable GDP
New Zealand real tradable and non-tradable GDP   .
Source:  The Treasury, Statistics New Zealand

Achieving improved economic performance requires policy changes with the potential to lift productivity across the economy and support a substantial lift in export performance. The Treasury provides policy advice that focuses on three intermediate outcomes that will contribute towards improved economic performance, which are reported on below. The OECD's 2013 Economic Survey of New Zealand provided broad endorsement of New Zealand's approach to policy priorities to lift growth, while highlighting the challenges in achieving long-term sustainable growth.

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