New Zealand government announced a massive NZD 12.1B stimulus program to support the economy at the time of disruptions by coronavirus pandemic. That’s equivalent to 4% of the country’s GDP. The package includes NZD 2.8B in income support, NZD 5.1B in wage subsidy support, NZD 2.8B in business tax changes, NZD 500m support for aviation sector and NZD 600m boost for health services.
Finance Minister Grant Robertson said the economy is expected to fall -1% by Q1 if 2021 if the package is implemented, better than -3% without the support. He also told the parliament that recession was “almost certain” in New Zealand”. “We will have an extended period of deficits and our debt as a country will have to substantially increase,” he added.
