Auckland back to top economic player

By JIM EAGLES business editor

The Auckland economy decisively out-performed the rest of New Zealand last year and will do the same this year.

The latest annual report on the region's economy, launched last night, shows that after lagging behind the rest of the country in the late 1990s, Auckland has resumed its role as the nation's economic powerhouse.

But, in launching the report, Peter Menzies, chairman of the Auckland Regional Economic Development Strategy, said the region had to do even better if it was to achieve its potential on the world stage.

Last year, the report says, the country as a whole grew by 4.2 per cent but the Auckland region's economy grew by 4.6 per cent.

Forecasts prepared by the National Bank for the Auckland Regional Economic Development Strategy (Areds) predict Auckland's economy will grow by 3 per cent this year and the national economy by just 2.5 per cent.

Cameron Bagrie, senior economist with the bank, said as a rule of thumb that probably meant the rest of the country - minus Auckland - would have around 2.3 per cent growth this year.

Next year, however, Auckland's growth is forecast to be 2.7 per cent, which would be pretty much the same as the rest of the country.

Menzies said the regional economy was growing rapidly but was still behind comparable regions around the Pacific.

"With per capita GDP at only 85 per cent of comparable Australian cities and the poor participation of some of our communities ... we could do better."

Part of the Areds exercise includes developing indicators to benchmark the region's progress against the likes of Sydney, Brisbane, Melbourne, Adelaide, Hobart, San Francisco, San Diego, Seattle, Portland, Vancouver and Singapore.

The report outlines progress on some of the baseline indicators developed so far:

* Average income per capita in Auckland "remains well under levels reached in comparable cities" which "implies relatively lower living standards". But offsetting that, Auckland appears to be the cheapest region in which to live.

* Auckland's work participation rate of 65 per cent has proved difficult to compare with overseas cities but is slightly lower than Wellington (69 per cent) or Canterbury (68 per cent). The report concludes this is probably because Auckland has a younger and more ethnically diverse population.

* In terms of educational achievement, "the region generally fares much better compared with Australian cities". Just under six out of 10 adults have completed secondary education and nearly half have continued on to tertiary education.

* Auckland society seems more egalitarian than comparable cities, but average income of Maori and Pacific Islanders is still 10 and 20 per cent respectively below that of Europeans.

At the same time, Menzies said, strategies were under way to make the region more internationally competitive.

These included supporting the development of Film Auckland; gathering data for a regional broadband strategy, capacity building for Maori and Pacific Island people; and developing a business land strategy to address "the supply of land and infrastructure for existing and new businesses."