Hawke's Bay economy 'only two star'

Napier Mayor Bill Dalton said the figures showed the central Government had "abandoned the provinces". Photo / Glenn Taylor

The Hawke's Bay economy scored just two out of a maximum five stars in the ASB/Main Report Regional Economic Scoreboard for the June quarter, based on measures such as employment, construction, retail trade and house prices.

The report measures economic growth compared with the previous quarter.

It said Hawke's Bay's construction outlook was flat and the real estate market subdued, but there were reasons to be optimistic.

The first quarter's results were strong, retail sales growth "fairly robust", new car registrations up 22 per cent and consumer confidence strong.

Susan White, CEO of economic development agency Business Hawke's Bay, said she thought a two-star rating was "a bit harsh" with some industries, such as pipfruit, doing well.

"I wonder if there is a bit of a lag for the results to come through," she said.

The high exchange rate continued to be a drag on Hawke's Bay's export-led economy.

"Back in June we were heading up around 87 cents to the US dollar, so that would have affected things.

She said growth was "lumpy" across the region.

"There are some businesses that can see an opportunity, gearing themselves for growth by putting strategies in place. Others are doing it tough and it could be the result of many variables -- you could be running a smart business but still be hurting because of the foreign exchange rate."

Auckland and Canterbury were the only regions to score five stars, with only Otago on four stars.

No region scored just one star and the country overall earned four stars.

Napier Mayor Bill Dalton said the figures showed the central Government had "abandoned the provinces".

"The central Government's position at the moment is they want to spend all their money where the votes are."

While the Government was investing in cities such as Christchurch, Wellington and Auckland, Hawke's Bay and other non-oil producing provinces were left out due to their small voting populations.

In response to the figures, Hastings Mayor Lawrence Yule said Hawke's Bay was in need of "an energy injection".

While Mr Yule remained "cautiously optimistic" about the region's economy, he said there were "a lot of empty shops" and builders and retailers were struggling.

Asked if he thought the Government had abandoned the region, Mr Yule said: "I don't think they've abandoned us, but I don't think they have a plan for us that is coherent and understands the position the region is in."