the cost of the canterbury re - build is forecast to be around nz $ 40 billion in current prices, or around 20 percent of annual gdp. this massive reconstruction is a unique feature of the new zealand outlook. it will have a major impact on the local and national economy for a number of years to come. although there is considerable uncertainty as to the magnitude and phasing of the re - build, annual construction investment associated with the re - build is projected to peak in 2016 and 2017 at around $ 4 billion. in terms of its contribution to new zealand ’ s gdp growth, reconstruction - related investment is expected to peak in 2014, with investment doubling relative to 2013 ( figure 3 ). bis central bankers ’ speeches construction activity is also increasing in auckland. residential consent issuance is running at 6000 per year – double the rate of mid 2011 ( figure 4 ). the auckland accord set a target of 39, 000 new housing consents over a three - year period and the government, together with the auckland council, recently designated special housing areas for fast - track resource and building consent with capacity for 15, 500 new homes. bis central bankers ’ speeches if these targets for auckland are met over the next three years, and if 12, 000 new homes are constructed in christchurch, as predicted, then construction volumes would need to be 10 percent higher than in 2004, which represented the peak of the last building boom. this estimate, however, assumes no growth in home building in the rest of the country. pressures on the construction industry will also increase with new zealand ’ s infrastructure needs and repairs on the remaining 42, 000 leaky buildings nationwide. ( iv ) growth in private consumption real private consumption has been growing at an annual rate of around 3. 5 percent in 2013 as a result of many factors : the high terms of trade, the 40, 000 person increase in employment, the 20, 000 person increase in permanent and long - term immigration, the 9. 5 percent increase in house prices, strong consumer confidence and low real interest rates. private sector consumption and investment have driven the recovery and accounted for much of new zealand ’ s economic growth over the past two years. can the economic expansion be sustained? in small advanced open economies, expansions usually come to an end for one or more of the following reasons : growth in the global economy slows ; the nation ’ s terms of trade decline significantly ; a major policy correction is needed to address a deteriorating fiscal or current account deficit ; or interest

not organized as shareholding companies for ensuring high - quality core capital comparable with the quality of the core capital of the shareholding companies. also, deductive items and prudential filters will be harmonized on an international level and will be applied at the level of a shareholding capital or its equivalent in the case of the legal entities which are not organized as shareholding companies. moreover, all components of the capital will be fully published. - introduction of a leverage ratio as an additional measure of the risk - based basel 2 framework, in order to include it in the treatment envisaged in the first pillar in the future, on the basis of an appropriate analysis. so as to provide comparability, the details about the leverage ratio will be harmonized on an international level, with full adjustment of the accounting differences. - introduction of a minimum global standard for providing liquidity for the financing needs which cover the compulsory rate of coverage of the liquidity in stressscenarios, backed by a long - term rate of structural liquidity. - establishing of counter - cyclical capital buffers above the minimum compulsory level. this framework will include measures for maintaining the capital, such as restrictions on the possibility for allocation of the capital elements. the basel committee will take into account an appropriate group of indicators, such as the indicators of profit and credits, as a way of ensuring the creation and utilization of the capital buffers. the committee will endorse a manner of determining the provisions which will be based on the future expected losses. - development of recommendations for reduction of the systemic risk related to rehabilitation of the internationally active banks. - the group of governors and responsible persons for the supervision, supported the below mentioned principles for directing the supervisors in the shift toward a higher level of capital in the banking system : - on the basis of the framework for counter - cyclical capital buffers, supervisors should require from the banks to strengthen their capital through a combination of the measures for maintaining the capital including activities for restricting the excessive payments of dividends, of purchase of own shares and compensations for the senior executives. - compensations for the senior executives should correspond with the reasonable undertaking of risks and long - term sustainable operations, based on the principles of granting compensations to the senior executives issued by the financial stability board. - the banks will be obliged to react promptly towards increasing the level and the quality of the capital in accordance with the new standards, in a way that will support the stability of the national