This report was prepared by the Economic division at the Ministry of Foreign Affairs and Trade, in consultation with New Zealand Trade and Enterprise and the Ministry for Primary Industries.
Summary
- Cyclone Gabrielle has caused significant damage to homes, infrastructure, and livelihoods across northern and eastern regions of the North Island. The cyclone is New Zealand’s costliest non-earthquake natural disaster, with economic losses expected to exceed the $2bn-$4bn of losses of the 2016 Kaikōura earthquake.
- Primary sector exports will be largely unaffected, with the exception of apple exports, where orchards were hit hard as Gabrielle struck the Hawke's Bay during a key harvest period. Damage to orchards and farms is also likely to see some lost primary production beyond 2023 too. However, other key export industries such as dairy are expected to experience limited disruption.
- The disruption and losses will weigh on New Zealand’s March quarter GDP, which may have contracted. However, the New Zealand economy remains very much open for business, with cyclone damage and disruption isolated to specific regions. Looking ahead, the recovery and rebuild work is expected to add to growth in the coming quarters. Tentative estimates by the RBNZ sees the recovery adding 1% to New Zealand’s GDP over coming years.
- Like most of the developed world, New Zealand is experiencing uncomfortably high inflation. Prices for food, vehicles, accommodation, and construction could be propelled higher over the first half of 2023 due to Cyclone Gabrielle. CPI inflation may remain above 7% for a little longer than had been expected.
Report
Originating in the Coral Sea in early February, Cyclone Gabrielle tracked south and struck Aotearoa between February 12 and 16, 2023. The devastation caused, including the loss of life, homes, possessions, and livelihoods, has been heart breaking. Gabrielle was felt over a wide area, including Northland, Auckland, the Coromandel, Waikato, Bay of Plenty, Gisborne/Tairāwhiti and Hawke's Bay. However, damaging rainfall, winds and flooding hit the Hawke's Bay and Gisborne/Tairāwhiti regions the hardest. The cyclone came close on the heels of Ex-Cyclone Hale and the Auckland Anniversary Weekend flood. A national state of emergency was announced for only the third time in New Zealand’s history.
At the height of the cyclone’s impact, around 225,000 homes were without power, and thousands of people were displaced as flood waters rose. In the worst affected areas there has been significant damage to agricultural land, property, and livelihoods. There has been extensive damage to key infrastructure in the east coast of the North Island, including roading, electricity, telecommunication, and water infrastructure. The damage continues to cause disruption to commerce and peoples’ lives.
Read the full report here.
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