New Zealand Annual Immigration Grows at Slower Pace

June 21 (Bloomberg) -- New Zealand’s annual immigration growth slowed in May for a fourth straight month as more residents departed.

The number of permanent migrant arrivals exceeded departures by 17,967 in the 12 months ended May 31, Statistics New Zealand said today in Wellington. That’s down from 19,954 in the year through April and is the lowest since September.

Finance Minister Bill English last month cut income taxes as the government seeks to encourage more New Zealanders to stay home rather than leave for higher paid jobs overseas. Fewer immigrants, low wages and tight credit are curbing domestic demand, adding to signs the central bank will only raise interest rates gradually this year.

“Although net migration has slowed much faster than anticipated, we expect the annual flow to stabilize at around 10,000, similar to the Reserve Bank’s outlook,” said Jane Turner, an economist at ASB Bank Ltd. in Auckland. “For now, the bank is likely to be comfortable with the subdued net migration and housing outlook.”

Reserve Bank Governor Alan Bollard increased the official cash rate a quarter-point to 2.75 percent on June 10 after keeping borrowing costs at a record low for 14 months.

Local Currency

The New Zealand dollar bought 71.22 U.S. cents at 12:15 p.m. in Wellington from 71.12 cents immediately before today’s report.

Analysts monitor a monthly, seasonally adjusted series to determine the pace of immigration. In May, a net 250 migrants arrived.

Immigration is declining after rising to the highest level in more than five years in January, amid signs that fewer New Zealanders are returning home and expectations that more will head overseas to work or study.

In May, arrivals dropped 13 percent from the year-earlier month while permanent departures rose 24 percent, today’s report showed.

The number of New Zealand residents departing in May surged 21 percent from the year-earlier month. The number of citizens headed to Australia in May climbed 20 percent from a year earlier to 2,536.

Short-term visitor arrivals rose 1 percent in May, seasonally adjusted, from April, today’s report showed. The underlying trend in arrivals is declining, the agency said. Unadjusted arrivals fell 0.4 percent from May last year.

Promotion of New Zealand as a destination for Australian travelers has helped arrivals recover after the global recession cut international air travel last year, reducing tourist visits from Asia and Europe. Tourism makes up about 10 percent of the New Zealand economy.

Total arrivals rose 3 percent in the year ended May 31 from a year earlier as an 11 percent gain in Australian tourists countered a slump in visitors from Asia, which dropped 7.1 percent, today’s report showed. Excluding Australia, visitors declined 2.8 percent.

Source:http://www.businessweek.com/news/2010-06-20/new-zealand-annual-immigration-grows-at-slower-pace-update2-.html