Gisborne has plummeted to last place on ASB’s Q1 Regional Economic Scoreboard after being first less than a year ago. Photo / James Pocock
Gisborne has plummeted to last place on ASB’s Q1 Regional Economic Scoreboard after being first less than a year ago. Photo / James Pocock
Gisborne has gone from first to last ranking on ASB’s Regional Economic Scoreboard in less than a year, but locals say there is more to the story and see a more positive outlook for the region’s prosperity.
The region was measured as having the highest economic growth in the countryin Q2 (quarter 2) of 2024 based on factors such as annual growth in employment, building consents and retail sales.
Experts highlighted that this growth was likely spurred on by rebuild activity following Cyclone Gabrielle in 2023, and some locals suggested this was an unrealistic reflection of the economic state of the region.
Gisborne Chamber of Commerce president Ashley Fisher. Photo / Gisborne Chamber of Commerce
Gisborne Chamber of Commerce president Ashley Fisher said he believed the figures measured in the scoreboard were still lagging behind reality, and Gisborne’s economic outlook was “more rosy” than the data suggested.
“It is probably more reflective of last year’s conditions, and the perspective on the ground is a bit more positive than that,” Fisher said.
Business confidence was higher, and there was more of an appetite for taking on new, qualified staff locally, he said.
Improving beef prices and positive signs for horticultural exports were also good indicators for the region.
“My advice to people reading [the data] is to take it with a grain of salt and look at the period it actually applies [to].”
“Our fundamentals are what drive our economy, and we should focus more on that than these outliers. While cyclone recovery is still happening, it has pretty much become business as usual, and those peaks they thought were economic activity were pretty much just a knee-jerk reaction to the problems that needed to be solved quickly.”
Larsen Sawmilling owner John Larsen. Photo / James Pocock
John Larsen, owner of Makaraka-based Larsen Sawmilling for 36 years, believed things were gradually improving for Gisborne’s economy.
“The last nine months have been very tight. Every now and again I think that I see green shoots and then they sort of get nipped off,” Larsen said.
The rural sector is a significant part of Larsen’s customer base and he said Gisborne was lucky it had a good summer for the rural economy.
“I think if we hadn’t had that, then there would have been a lot of businesses around this town severely impeded.”
Larsen said Gisborne’s placement on the scoreboard relative to other regions didn’t come as a surprise to him, but he was optimistic about the region’s economic outlook in the near term.
“We’re very lucky we’ve got a very well-established hinterland rural sector that will get this district through.
“[By spring] we’ll know what lambs we’ve got on the ground, we’ll know what calves we’ve got on the ground, we’ll be able to do some budgeting and guys will be able to say ‘I can put that fence in’ or ‘I’m going to develop that block’.”
Fisher and Larsen also noted the potential benefit for local businesses from the Government’s $6.6 billion tax/depreciation incentive for businesses, allowing them to deduct 20% of a new productive asset’s value from their tax return.
Consumer confidence figures for Gisborne were combined with Hawke’s Bay (placed 14th) in the data sets used by ASB. The combined regions were noted as being among the least confident in the country overall.
From the 833 weighted results, 36% said Tairāwhiti was not a good place to start or run a business, up from 24% in 2022, while 39% of respondents didn’t believe Tairāwhiti had diverse employment opportunities, up from 29% the year before.
ASB chief economist Nick Tuffley said it was not unprecedented for a region to go from first place to last, or close to it, over that period.
“Auckland went from first to 14th in the space of about a year,” Tuffley said.
He said it was especially true of a small region like Gisborne.
He said the economic surge after Cyclone Gabrielle was “unsustainable”, as shown by Gisborne’s above-average retail sales figures normalising to close to the national average in the last quarter.
