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flag New-Zealand New-Zealand: Economic and Political Outline

Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline

Economic Indicators

New Zealand's GDP dropped due to the global economy slowdown.  The country had shown a negative growth during 18 months before its GDP became stable and restarted its growth again in 2010. This improvement was notably due to the establishment of an efficient monetary policy (a reduction of the key rate from 8.25% to 2.5%), an attractive fiscal policy, a strong increase of the migratory balance which stimulated the domestic demand, a small revival in the sectors of real estate and services for companies, as well as a stimulus plan aiming in particular at employment, education, tourism, telecommunications, building and infrastructures.

This activity was highly influenced by the dynamism of the primary sector, in particular by the fishing, forestry and mining industries. Traditionally, New Zealand's economic growth factors are domestic demand and exports. Its GDP per capita is in the process of catching up with the main western European economies ( USD 38,227 in 2011).  However, unemployment started to increase again due to the economic crisis (6.4% in 2011).

The country was struck by two strong earthquakes in December 2010 and in February 2011and the cost of the reconstruction was estimated to be more than NZD 2 billion.  At the beginning of 2011, the country experienced a strong appreciation of its currency, which had, as a consequence, a high increase in the cost of living.  The inflation rate has also increased reaching an annual average of 5.3% in 2011.  Nevertheless, the positive economic benefits from the Rugby World's Cup, the greatest sporting event that New Zealand has ever hosted, which took place in September and October 2011, should allow the country to reach a growth rate of more than 3% in 2012.

 
Main Indicators 2009201020112012 (e)2013 (e)
GDP (billions USD) 117.94e140.51168.82182.70191.44
GDP (Constant Prices, Annual % Change) -2.01.7e2.03.83.2
GDP per Capita (USD) 27,29332,16338,227e40,93642,457
General Government Balance (in % of GDP) -2.1-4.5-5.1e-3.0-1.1
General Government Gross Debt (in % of GDP) 26.132.035.3e34.634.1
Inflation Rate (%) 2.12.34.42.72.4
Unemployment Rate (% of the Labor Force) 6.26.56.45.64.8
Current Account (billions USD) -3.38e-5.74e-6.51-10.15-11.56
Current Account (in % of GDP) -2.9-4.1-3.9e-6.0-

Source: IMF - World Economic Outlook Database ; World Bank , Last Available Data

Note: (e) Estimated Data

Main Sectors of Industry

New Zealand is one of the smallest economies of the OECD and it is still heavily dependent on agricultural products. Agriculture represents New Zealand's main source of exports. The country produces 2% of the total global production of dairy products. The other main agricultural export products are meats, wood, fruits and fishing products. New Zealand also has a thriving wine industry. The country is rich in many natural resources, in particular, gas, oil and coal.

The industrial sector represents one-fourth of the GDP and employs nearly 20% of the workforce.  Food processing, textiles and transportation equipment are among the main industries of the country.

The services sector accounts for more than two-thirds of the GDP and workforce. Tourism, which has been growing rapidly in recent years, is one of the country's most important sources of foreign-exchange revenues. The sectors of retail and wholesale trade, restaurants and hotels are major components of the economy of New Zealand, accounting for almost 25% of the services sector. The quality of the transport infrastructures plays an essential role in the country's economic growth.

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 6.6 20.9 72.5
Value Added (in % of GDP) 5.6 25.0 69.4
Value Added (Annual % Change) -2.8 -5.2 0.4

Source: World Bank - Last Available Data.

 

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Monetary Indicators 20062007200820092010
New Zealand Dollar (NZD) - Average Annual Exchange Rate For 1 USD 1.541.361.421.601.39

Source: World Bank - Last Available Data.

 

Find out all the exchange rates daily on our service Currency converter.

 
Learn more about Market Analyses about New-Zealand on Globaltrade.net, the Directory for International Trade Service Providers.
 

Indicator of Economic Freedom

Score:
82.3/100
Position:
Free
World Rank:
4/179
Regional Rank:
4/38

Distribution of Economic freedom in the world
Source: 2011 Index of Economic freedom, Heritage Foundation

Note: The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

 

Country Risk

See the Country Risk Analysis Provided By Ducroire.

 

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Foreign Trade in Figures

Foreign trade is an essential element in New Zealand's economy, which is currently, one of the most open economies in the world. The share of foreign trade in its GDP represents more than 50%. The country's economy is very trade-oriented, with exports of goods and services accounting for 33% of the total output.

The main trade partners of New Zealand (both for imports and exports) are Australia (most of the merchandise circulates freely between the two countries), China, the United States and  Japan. The main exports of the country are dairy products, meats, wool, machinery, fruits and peanuts.  The main commodities imported are vehicles, machinery, mineral fuels and oil, electric and electronic equipment and plastics.  The trade balance attained a surplus in 2009 due to the increase in milk exports and the drop in prices and volume of imports.

In 2010, New Zealand signed a free trade agreement with Malaysia and negotiations have begun in February 2011 to set up a free trade agreement between New Zealand, Russia, Belarus and Kazakhstan.

 
Foreign Trade Indicators 20072008200920102011
Imports of Goods (million USD) 30,88234,36925,56630,62837,075
Exports of Goods (million USD) 26,94330,58024,93331,37237,675
Imports of Services (million USD) 9,0899,5857,8259,22711,233
Exports of Services (million USD) 9,2859,1327,7608,90810,047
Imports of Goods and Services (Annual % Change) 10.0-4.7-14.8--
Imports of Goods and Services (in % of GDP) 29.232.026.5--
Exports of Goods and Services (in % of GDP) 28.330.728.2--
Trade Balance (million USD) -1,790-1,7051,3162,367-
Trade Balance (Including Service) (million USD) -1,608-2,162---
Foreign Trade (in % of GDP) 57.462.754.7--

Source: WTO - World Trade Organization ; World Bank , Last Available Data

 

Main Partner Countries

Main Customers
(% of Exports)
2010
Australia 23.0%
China 11.1%
United States 8.6%
Japan 7.8%
United Kingdom 3.5%
See More Countries 46.0%
Main Suppliers
(% of Imports)
2010
Australia 18.2%
China 16.0%
United States 10.4%
Japan 7.3%
Germany 4.1%
See More Countries 44.0%

Source: Comtrade, Last Available Data

 

Main Products

Main Exports
(% of Exports)
2010
Milk and cream, concentrated or containing added...Milk and cream, concentrated or containing added sugar or other sweetening matter 13.2%
Meat of sheep or goats, fresh, chilled or frozenMeat of sheep or goats, fresh, chilled or frozen 6.3%
Butter, incl. dehydrated butter and ghee, and...Butter, incl. dehydrated butter and ghee, and other fats and oils derived from milk; dairy spreads 5.0%
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals, crude 4.5%
Meat of bovine animals, frozenMeat of bovine animals, frozen 3.8%
See More Products 67.2%
Main Imports
(% of Imports)
2010
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals, crude 9.5%
Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702) 6.7%
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 5.4%
Automatic data processing machines and units...Automatic data processing machines and units thereof; magnetic or optical readers, machines for transcribing data onto data media in coded form and machines for processing such data, n.e.s. 2.8%
Medicaments consisting of mixed or unmixed...Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses "incl. those in the form of transdermal administration" or in forms or packings for retail sale (excl. goods of heading 3002, 3005 or 3006) 2.0%
See More Products 73.6%

Source: Comtrade, Last Available Data

 
 

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Sources of General Economic Information

Ministries
Ministry of Economic Development
Statistical Office
The New Zealand Statistics
Central Bank
Reserve Bank of New Zealand
Stock Exchange
New Zealand Stock Exchange
Search Engines
Yahoo! New Zealand
Searchnz
Acess NZ
Looksmart
Bing
New Zealand Search
NZ Explorer
Economic Portals
Statisphere

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Political Outline

Executive Power
The head of state is the British sovereign represented by a Governor General. The head of government is the prime minister, who is responsible to the legislature and appointed by the governor-general acting upon its advice. Cabinet is the most senior policy-making body and is led by the Prime Minister, who is also, by convention, the Parliamentary leader of the governing party or coalition. The Prime Minister holds the executive powers which include implementation of the law and running the day-to-day affairs of the country.
Legislative Power
Legislative authority is vested in a unicameral 120-member House of Representatives. 69 members elected by popular vote in single-member constituencies including seven Maori seats, and 51 proportional seats chosen from party lists. All members serve three-year terms. The people of New Zealand have considerable political rights.
Main Political Parties
New Zealand has a multi-party system. The main political parties are the New Zealand Labour Party (centre-left) and the National Party (centre-right, conservative), usually forming centre-left or centre-right coalitions. The other major political parties are:
- The New Zealand First Party (populist nationalist)
- ACT New Zealand (free market liberal party)
- Green Party (left-wing environmentalist party)
- Maori Party (Maori ethnic party)
- United Future (Christian Democrats)
- The Alliance (left-wing).
Current Political Leaders
Queen of New Zealand: ELIZABETH II (since February 1952) – hereditary
Governor-General: Lt Gen Sir Jerry MATEPARAE (since 31 August 2011)  – appointed by Queen
Prime Minister: John Key (since 19 November 2008)
Deputy Prime Minister: Bill English (since 19 November 2008)
Next Election Dates
Parliamentary: 2011
 

Indicator of Freedom of the Press

World Rank:
13/179
Evolution:
5 places down compared to 2010

Source: Worldwide Press Freedom Index 2011, Reporters Without Borders

Note: The world rankings, published annually, measures the violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position is assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire sent to partner organizations,150 RWB correspondents, journalists, researchers, jurists and activists of human rights, including the main criteria - 44 in total - to assess the situation of press freedom in a given country. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).

 

Indicator of Political Freedom

Ranking:
Free
Political Freedom:
1/7
Civil Liberties:
1/7

Map of freedom 2010
Source: Freedom House

Note: The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

 

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