High dollar affecting exporter confidence

Exporter confidence and investment is being crimped by the high dollar, a survey says.

The DHL and New Zealand Trade and Enterprise six-monthly survey also showed skill shortages and labour costs were affecting exporters.

About 31 per cent of 303 export businesses surveyed last month said they had future investment plans disrupted as a result of the high currency.

The proportion of exporters confident of growth over the next year fell to 61 per cent from 63 per cent six months ago and 70 per cent a year earlier in the first survey.

The greatest drop in confidence was evident in the short term with only 38 per cent of those surveyed predicting an increase in orders over the next quarter against 59 per cent six months ago.

Confidence regarding the industry as a whole is similar, with only 35 per cent expecting an increase in industry export orders in the next three months, rising to 52 per cent over the year.

"These results are in keeping with recent business indicators reporting a decrease in general business confidence among organisations and across all industry sectors," NZ Trade and Enterprise chief executive Tim Gibson said.

Currency issues remain the most significant burden for local exporters. More than 40 per cent of firms said the strong currency influenced them to reduce investment, while 21 per cent have been forced to cut staff as a result.

Australia remains the key destination for most businesses, with 68 per cent exporting across the Tasman, followed by North America (47 per cent), Japan (37 per cent) and the Britain (36 per cent).

- NZPA