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Nicola Willis promised Kiwis that there\u2019s still \u201chope\u201d despite the bleak outlook for the economy.\xa0

Finance Minister Nicola Willis spoke to Mike Hosking on Newstalk ZB this morning after yesterday\u2019s announcement of\xa0a recession.\xa0

Willis said very high inflation and rising interest rates had been prolonged.\xa0

\u201cThere\u2019s been a big hit to the growth forecast.\u201d\xa0

On Q1, Willis said, \u201cThere is hope.\u201d\xa0

\u201cBoth the Treasury and the [Reserve] Bank are forecasting growth this year.\u201d\xa0

She said tourism was coming back and the dairy price was okay, as examples of positive moves for the economy. Hosking disagreed that the dairy price was okay.\xa0

\u201cPeople focus on the headlines with the recession and the GDP. But that has happened despite a very fast-growing population and immigration,\u201d Willis said.\xa0

\u201cSo on a per-capita basis, on a per-person basis, the economy has barely grown in several years, and that is a real worry.\u201d\xa0

\u201cThere are always people that think there\u2019s a money tree at the back of the garden.\u201d\xa0

\u201cI don\u2019t think we have seen the value for the borrowing the last Government took on.\u201d\xa0

She said the Government cuts and restructuring won\u2019t have a huge impact on the recession because the money will go to more \u201cfront-line\u201d workers for Government organisations.\xa0

Gross domestic product (GDP) fell 0.1 per cent in the December 2023 quarter, compared with the September quarter, which also shrank.\xa0

Economists traditionally define a recession as two successive quarters in which the economy contracts.\xa0

GDP per capita fell 0.7 per cent in the last three months of the year, Stats NZ said yesterday.\xa0

Real gross national disposable income fell 1.4 per cent.\xa0

Wholesale interest rates and the New Zealand dollar fell in response to the news.\xa0

Yesterday, Prime Minister Christopher Luxon outlined the Government\u2019s plan for the next 100 days and\xa0blamed the recession on Labour.\xa0

\u201cSadly, the previous Government has borrowed more. We\u2019ve got to face up to that. We\u2019ve got nothing to show for it. We\u2019ve got a big fiscal repair job to do,\u201d Luxon said.\xa0

Jaime Lyth is a multimedia journalist for the New Zealand Herald, focusing on crime and breaking news.\xa0

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