Migration hits decade high - China topples UK as main source

NZ gained a seasonally adjusted 3,500 net new migrants in February, the most since April 2003, and up from 3,100 in January. Photo / Greg Bowker

New Zealand's inbound net migration rose to a 10-year high in February, as fewer kiwis jumped the ditch to Australia and China became the biggest source of net migrants for the first time in a decade.

The country gained a seasonally adjusted 3,500 net new migrants in February, the most since April 2003, and up from 3,100 in January, according to Statistics New Zealand. Seasonally adjusted there was a net outflow of 600 people to Australia in February, down from 850 in January.

On an annual basis, New Zealand net migration rose 13 per cent to 96,900 people for the year ended February, while departures fell 20 per cent to 67,800. China became the biggest source of net migration for the first time in a decade, with a net gain of 6,100 people, followed by India with more than 5,800, and pipping the UK which had previously provided the biggest net migrant gain.

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Chinese long-term arrivals rose 8.7 per cent to 8,556 in the year ended February 28, and are up 14 per cent over the past two years. At the same time, UK arrivals, slipped 0.6 per cent to 13,929, and are down 3.1 per cent over the past two years.

Last week the Reserve Bank said net migration has rapidly increased over the past 18 months, boosting demand for housing and consumer spending, and is seen as an inflationary pressure that prompted the bank to lift the official cash rate a quarter-point to 2.75 per cent.

"This monthly result suggests migration flows may be starting to run a little ahead of our forecasts, although it is difficult to judge whether that will be sustained," ASB economist Dan Smith said in a note. "Strong inwards migration will continue to add to domestic demand and housing market pressures, and is one of the reasons why interest rates will rise over the next couple of years."

Auckland attracted most of the nation's new migrants with a net gain of 13,700 in the year. Canterbury followed with a net gain of 5,100 migrations, while Otago recorded a net increase of 600 migrants and Wellington attracted 400 new net migrants.

Today's figures also showed short-term visitor arrivals rose to a record for a February month, led by an increase in Australian visitors. Total visitor arrivals rose 7 per cent to 301,200 people from the same month the previous year. More than 105,500 Australians visited New Zealand in February, offsetting declines in Chinese and Hong Kong visitors due to an earlier Lunar New Year.

On an annual basis visitor arrivals rose 7 per cent to 2.77 million in the year ended February. Australians made up the bulk of the arrivals, with a 6 per cent gain to 1.23 million. German visitors were the fastest growing group, up 16 per cent to 73,760, while Chinese arrivals grew 14 per cent to 237,200 visitors.