New Zealand is Officially in A Recession

It seems like the economic turmoil hitting markets across the globe has also hit New Zealand as well:

NEW Zealand fell into recession in the first half of this year for the first time in a decade, according to official figures released today.

New Zealand’s gross domestic product shrank 0.2 perc ent in the three months to June, following a 0.3 contraction in the March quarter, Statistics New Zealand said.

Economists commonly define two straight quarters of economic decline as a recession.

Tight credit conditions and high costs slowed domestic spending, and drought cut agricultural production, Statistics New Zealand said.

Economic growth for the year to June amounted to 2.6 percent, the government agency said.

New Zealand last was in recession in the second half of 1997 and early 1998 amid the Asian financial crisis.

A survey of forecasters by the New Zealand Institute of Economic Research showed most economists were expecting another decline in the September quarter.  [AFP]

During my trip to New Zealand last year, some of the New Zealanders I met claimed that there economy was taking a beating because of governmental spending programs and high taxes the country has.  I would be interested to hear what others living in New Zealand have to say.