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Thursday 03rd of March 2011
March 1, 2011    

Earthquake will hit New Zealand growth

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by Kay Murchie

New Zealand Finance Minister Bill English has today warned last week’s earthquake in Christchurch will impact negatively on economic growth.

Speaking to Radio New Zealand, Mr English, who is also deputy prime minister, said: “June-to-June could be close to zero growth.”

The disaster, which occurred on 22 February, is believed to have taken more than 240 lives.

Mr English believes the quake could push the nation into recession as Christchurch, which is New Zealand’s second largest city, accounts for approximately 15% of the country’s economy.

Costs relating to the disaster could hit NZ$16 billion (£7.3 billion).

New Zealand’s economy contracted in the June to September quarter last year and the Finance Minister believes fourth quarter growth figures will be “pretty flat” - figures are due later this month.

Meanwhile, the warning comes just a few weeks after Australia said it could see its economy contract in the January to March period.

The warning came from Treasurer Wayne Swan after the country was hit by flood and cyclone disasters, which led to a fall in coal and agricultural exports.

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