Waioweka Gorge State Highway costs estimated $8m in lost GDP every day it is closed
Progress clearing a slip on State Highway 2, Waioweka Gorge, last week. In 2024, NZ Transport Agency Waka Kotahi (NZTA) reported that an estimated $8 million in GDP was lost for every day the road was closed. It has been closed for 24 days so far this year. Photo / NZTA
Closures of State Highway 2 through Waioweka Gorge cost an estimated $8 million in lost gross domestic product every day.
NZ Transport Agency Waka Kotahi’s (NZTA) 2024 SH2 Waioweka Gorge Corridor Resilience Single Stage Business Case, released to the Gisborne Herald under the Official Information Act, found that every day the Waioweka Gorge was closed cost an estimated $8m in lost gross domestic product (GDP).
Between 2011 and 2020, the 48km section of road between Gisborne and Ōpōtiki, Bay of Plenty, was closed an average of 15.2 days each year, according to NZTA data from its Traffic Road Event Information System.
That works out at $121.6m in lost GDP each year on average over the previous decade.
The road provides freight access to the primary sector economy, which made up 18.8% of Tairāwhiti’s GDP, compared with 5.8% nationally as of 2024.
The business case also states that Tairāwhiti had the highest ratio of freight tonnage to GDP in the country – just over 17 times the national ratio as of 2024.
Two months into 2026, the road has already been completely closed for 24 days after severe slips and flooding on January 16.
It reopened to one lane on February 9. Since then, convoys and now a stop/go traffic system have gradually been put in place.
This arrangement has not been without further disruption, including convoy cancellations due to ongoing slip risks.
A ‘lifeline route’
The 2024 business case, under the heading “Investment in Waioweka Gorge (SH2) is critical”, describes the road as a “lifeline route” and “critical regional freight route” for the East Coast.
The report identified 83 projects on the section of road that would build a more resilient and safe network, with 88% fewer closure days and 10% fewer deaths and serious injury crashes projected.
A full rebuild programme was estimated to cost $166m in 2023 dollars. At the high end, it could cost $196m.
The two other options presented were labelled “Outcomes Focused” and “Affordability Focused”.
The affordable option only addressed the highest risk sites and was expected to cost $66.7m in 2023 dollars or $80.4m at the high end.
The business case recommended the outcome-focused option, which it found to have the best cost-benefit ratio, at an expected cost of $129.6m or $152.5m at the high end.
It would cover 58 rebuild projects in two tranches over six years. Some of what it was predicted to achieve included:
- A 53% reduction in closures in the Waioweka Gorge
- 83% fewer days closed with roads reopened faster
- 7.5% less deaths and serious injuries per year
- A 50% reduction in freight detour costs
- At least $1m annual savings in unplanned natural hazard remediation costs per year.
The cost was expected to be Crown-funded, provided it was approved by the NZTA board.
Business case and costing under review
NZTA manager of ministerial services Josh Driscoll, in a statement to the Gisborne Herald, said it was in the process of reviewing the sites listed in the business case, and there may need to be some updates, including cost.
Future investment in the corridor was still subject to funding approval.
“State Highway 2 (SH2) is the key connection for Gisborne and the surrounding Tairāwhiti region to the Bay of Plenty, Hamilton and Auckland, for tourism, vital fuel and food supplies as well as exporting local products,” the NZTA statement said.
“Gisborne’s relative isolation means businesses and communities rely on having access to safe, reliable transport to get their goods to domestic and international markets and to access basic services.
“The geographical location, topography and geology of the Waioweka Gorge create a challenging environment and resilience issues with steep-sided hills rising from 400 metres near the coast to 1000 metres inland.”
The statement said NZTA recognised the critical role the Waioweka Gorge played and had previously assessed ways to improve its resilience and safety through the business case.
“Ahead of the most recent severe weather, NZTA had already undertaken both operational- and resilience-focused work in the gorge to address known weather-related risks.” This work was completed shortly before the heavy rainfall on January 16, 2026.
“Recovery and maintenance work was already underway at five sites within the gorge, as part of emergency works recovery, following damage caused by the September 2025 weather event.
Progress at those sites had been limited by access issues, as was common on geographically complex terrain.
NZTA said work at those sites would continue once two-lane access into the gorge was safely restored, and a further assessment would be carried out to identify any new at-risk locations after the recent event.
“While this preparatory and recovery work helps reduce risk, extreme weather events of this scale can still cause significant damage, even in areas where mitigation and resilience measures are already in place.”