Business confidence 'driving growth' in city

The Bay of Plenty has been revealed as New Zealand's strongest-growing region for the past 12 months.

The region's economy expanded 4.8 per cent from a year earlier, coming out on top of Canterbury (4.4 per cent), Auckland (4.3 per cent) and Southland (4 per cent). Nationally, annual growth was 3.5 per cent.

The region came out ahead of the national average increase in most key growth areas in ANZ's Regional Trends report, including employment, internet job ads, house sales, section sales, rural real estate sales, new car registrations and commercial building permits.

Business confidence was down across the region but that was not necessarily true for Rotorua.

Rotorua Chamber of Commerce chief executive Darrin Walsh said Rotorua had traditionally lagged behind the Tauranga region in growth but announcements and investment in the city since October last year showed that was changing.

"Business confidence here in Rotorua is certainly increasing and is also fuelling growth and employment activity we can see and touch."

Mr Walsh said the growth started in October with Red Stag's announcement of a multimillion-dollar investment, with a number of announcements since then.

He said that sort of growth led to development and new business jobs being created.

"For us, we've been in growth mode for the last six to eight months, Tauranga has been in growth mode for the last two years."

The drivers in the Rotorua economy have been in tourism and the wood processing sectors.

Francis Pauwels, the chief executive of Grow Rotorua, said tourism accommodation numbers were up by about 20 per cent against a national average of 5 per cent.

"I think what we are seeing is the strength of having a relatively diversified Rotorua and Bay of Plenty economy that can ride various trends and cycles including commodity market exposure," he said.

"And what we are seeing in Grow Rotorua is quite an upswing in interest and confidence to invest with a number of exciting new developments already under way particularly across the wood processing sector and more in the pipeline.

"The strong leadership that exists at council, Maori economy and the business community is really helping this confidence."