The Otago economy needs an injection of energy, as do most regions in the country, a new report by the ASB has found.
The bank's regional economic scoreboard found that while the Otago economy showed some improvement in the last quarter, house prices fell 7% last year, construction prospects were weak and guest nights slipped below the national average.
Positives were the strength of the labour market, with unemployment in Otago at 3.2% below the national average of 3.7%, and employment, which grew 10% last year, higher than a year ago.
Retail spending figures and general confidence were also above average.
ASB chief economist Nick Tuffley said in an interview that Otago was one of the few regions which improved its performance between third and fourth-quarter surveys, with a strong employment market pushing it from the tail of the field to the top half.
The bank analyses quarterly regional statistics to rank the economic performance of the country's 16 regional councils.
Those to come out on top were Wellington, West Coast and Canterbury, which were rated fair to middling with three stars.
All the others, apart from Northland, were rated as needing an "energy injection" and given two stars, with Northland rated as "take pity", with one star.
Otago Chamber of Commerce chief executive John Christie said economic conditions were changing quickly and the survey could be out of date.
He felt Otago's two-star rating was a bit harsh.
Economic conditions had deteriorated in recent weeks, but Mr Christie said the region's unemployment and retail rates were better than the national average, while the whole country had been hit by the downturn in tourism.
Mr Christie remained confident Otago would weather the economic downturn better than other regions because the economy was weighted towards tertiary education and agriculture servicing, sectors which had shown some resilience.
"I hold a fair degree of confidence that those two sectors will assist us to weather the economic downturn better than other regions."
Mr Tuffley said the survey was a snapshot at that time and it was inevitable that regions would come under more pressure this year.
However, he believed the South Island was faring better than the North Island, where the housing market in cities like Auckland had fallen sharply.
"The South Island in recent scoreboards has generally looked in better shape than the North Island."
Nationally, the survey had shown employment figures and wages were healthy, retail sales needed a boost, and house prices and sales, car registrations and construction were all weak.
