Well, that escalated quickly!

From a few concerns about the effects on Chinese tourism in late January to a full-blown pandemic and lockdown in New Zealand, the COVID-19 crisis has evolved rapidly over the last two months. We communicate just how quickly the economic ramifications have unfolded and examine how things might play out for the economy over the next 1-2 years.

Economy poised to shut down to save lives

The COVID-19 pandemic has sent New Zealand into a full-scale lockdown. In doing so, the government is working to flatten the curve and ensure that lives are saved. There is no escaping that this decision puts the economy into hibernation for the next month. Most of what will be achieved in the next four weeks will be maintaining an economic heartbeat while stamping out the virus as much as possible. If this plan is successful, New Zealand can emerge from the crisis sooner rather than later and thereby maximise its chances of regaining momentum in the economy.

Chart of the Month: Buckle up, New Zealand’s not far behind

Comparing the number of confirmed COVID-19 cases in New Zealand to some of our key international partner economies can help us to understand how we’re tracking and what might be ahead for us. There’s no one correct chart to show how COVID-19 is affecting the world, but we hope this chart provides a different way of looking at the numbers.

Implications of COVID-19 on international travel

New Zealand’s connections with the outside world was upended on 14 March when the Prime Minister announced a mandatory 14-day self-isolation period for all travellers arriving in New Zealand (excluding the Pacific Islands). The self-isolation requirement was a response to the escalating severity of the COVID-19 pandemic and came after the US banned European travellers for a month just days earlier. This requirement to self-isolate will be a major blow to the New Zealand economy, as the requirements will effectively halt the majority of travel in and out of New Zealand.

Crisis Note: Brace for impact – readying for a pandemic and recession

The COVID-19 pandemic is causing economic chaos both internationally and in New Zealand. A recession is now inevitable, and the economic ramifications of the pandemic and response will substantially change people’s livelihoods. However, New Zealand is resilient and stands ready to weather this pandemic, and there are actions that can be taken to reduce the severity of the economic blow.