New Zealand - Economic analysis of government's policies, investment climate and political risk.

THE

MIKE P. McKEEVER INSTITUTE

OF

ECONOMIC POLICY

ANALYSIS

NEW ZEALAND: Economic Policy Analysis

This site presents an analysis of the New Zealand government's economic policies compared to a revised list of 34 economic policies as prepared by student Henry Agyeman with the Mike P. McKeever Institute of Economic Policy Analysis (MIEPA)in December 2013. To read the analysis scroll through this site. To learn more about the background policies, click here  Introduction and Policy Recommendations

To learn more about MIEPA, click here Return to MIEPA's Home Page

Henry Agyeman, a New Zealand citizen who currently [December 2013] lives in San Francisco, has completed a study of the home country government's economic policies as compared to the MIEPA list of policies as outlined above. The study on New Zealand is shown below. The ratings herein are based on the following rating scale:

RATING SCALE

5.0 Perfect Facilitation of Wealth Creation
4.0 Midway between Perfect and Neutral
3.0 Neutral Effect on Wealth Creation
2.0 Midway between Neutral and Obstructionist
1.0 Perfectly Obstructionist to Wealth Creation
[Rating scale copyright Mike P. McKeever, 2013. Used herein with permission]

To read a disclaimer about the analysis in this file, scroll to the bottom of the file.

Return to MIEPA's Home Page

NEW ZEALAND:

Comparison of New Zealand's economic policies to MIEPA criteria as prepared by native student of New Zealand Henry Agyeman studying in the US in December 2013.

RATING SUMMARY

POLICY NUMBER      RAW SCORE   ADJUSTED SCORE    POSSIBLE   PERCENTAGE

        1               5.0          15.0             15.0       100%

        2               4.0          12.0             15.0        80

        3               5.0          15.0             15.0       100

        4               4.0          12.0             15.0        80

        5               4.0          12.0             15.0        80

        6               4.0          12.0             15.0        80

        7               5.0          15.0             15.0       100

        8               5.0          15.0             15.0       100

        9               4.0          12.0             15.0        80

        10              3.0           9.0             15.0        60

        11              3.0           9.0             15.0        60

        12              5.0          10.0             10.0       100

        13              5.0          10.0             10.0       100

        14              5.0          10.0             10.0       100

        15              4.0           8.0             10.0        80

        16              5.0          10.0             10.0       100

        17              5.0          10.0             10.0       100

        18              4.0           8.0             10.0        80

        19              5.0          10.0             10.0       100

        20              5.0          10.0             10.0       100

        21              3.0           6.0             10.0        60

        22              3.5           7.0             10.0        70

        23              5.0          10.0             10.0       100

        24              5.0          10.0             10.0       100

        25              4.0           8.0             10.0        80

        26              5.0          10.0             10.0       100

        27              2.0           4.0             10.0        40

        28              4.0           8.0             10.0        80

        29              3.0           3.0              5.0        60 

        30              5.0           5.0              5.0       100

        31              5.0           5.0              5.0       100

        32              3.0           3.0              5.0        60

        33              5.0           5.0              5.0       100

        34              4.0           4.0              5.0        80

   TOTAL              145.5          312.0           365.0        85.5%
                      =====        ======            =====        =====

Return to MIEPA's Home Page


INDIVIDUAL POLICIES


1. Freedom from internal control 5.0

New Zealanders have very limited constraints on their civil freedom. New Zealanders live in a society where constructive discourse is widely accepted, and the media releases publications frequently expressing their opinions and concerns related to the country. Activism and campaigning for causes is something citizens believe in and have the right to do. As an example New Zealanders successfully campaigned to legalize gay marriage and were the first country to achieve it. They frequently pressure the government to boycott Japanese fisherman who engage in whaling and poaching. There is freedom of religion, sexual orientation, and political affiliation. Citizens and business people alike have the ability to move freely within the country and abroad.

Source : Personal

2. Freedom of speech 4.0

There is no specific statute or rule of the common law that guarantees the right of a citizen to express themselves freely. Freedom of speech it seems is implied in New Zealand society, one can publish and say whatever they want but can legally be punished if they infringe upon the law. Curiously, it seems that the only reason that freedom of speech exists in New Zealand is that there are inadequate exceptions in the law opposing it. It is widely accepted in New Zealand that certain legal restrictions exist against freedom of speech and are grouped under sedition, indecency, breach of the peace, defamation and contempt of Court. Citizens arenít as censored as England but civil liberties could be breached in critical times when unpopular views are presented. A real test to New Zealand freedom to communicate hasnít been presented in its history but New Zealanders are extremely vocal about a wide variety of issues and have protested on several occasions to protect their environment, commercial interests, and several student related issues without being restricted or censored.

Source: http://www.teara.govt.nz/en/1966/freedom-of-speech

Personal

3. Effective, fair police force 5.0

New Zealand has a low crime rate and a relatively honest and just police force that are effective at protecting the community. Citizens feel safe and secure when police arrive and in more serious cases New Zealand Police are very well equipped to deal with those situations as well with the AOS (Armed Offenders Squad). The New Zealand Police is the national police force with over 11,000 staff and holds primary jurisdiction over internal criminal law. Over the last 3 years there were 244 cases of serious crime reported by the police department which included murder, attempted murder, and manslaughter/driving causing death; this is infinitesimal compared with the rest of the developed world. Police bribery and brutality rarely make the headlines and other serious crime like theft and robbery feature more prominently in the media crime headlines, usually buried deep within the paper because its usually never significant enough. New Zealand Police donít carry visible side arms and often deliberate very effectively in situations to diffuse tension and resolve things amicably. They are there to serve and protect the community and to the best of their ability do this to the letter of the law.

Source: http://www.police.govt.nz/sites/default/files/publications/crime-stats-national-20130630.pdf

http://www.crime.co.nz/

Personal

4. Private Property 4.0

New Zealand has a strong foundation of property and economic freedom, which are well guarded by the governmentís robust protection measures. Citizens have the freedom to purchase and sell their property and this is among their court-protected rights. The judicial system, although independent, functions exceptionally well by enforcing property and intellectual law to protect all property owners. New Zealand has all the necessary departments to maintain and oversee the integrity of the property rights framework. The intellectual property office (IPONZ) is responsible for patents, trademarks, copyrights and patents; also providing all the necessary information and paperwork about that domain. Tenancy and Landlord property law is neutral in New Zealand ensuring that both Tenant and Landlord receive adequate mediation to resolve any issues.

Source: http://www.globalpropertyguide.com/Pacific/New-Zealand/Landlord-and-Tenant

Personal

http://www.heritage.org/index/country/newzealand

5. Commercial Banks 4.0

The banking system in New Zealand comprises of one central bank-the reserve bank- five commercial banks, trustee savings bank, and the New Zealand Post Office Savings Bank. Although other institutions engage in what could be considered banking activities, the core functionality of New Zealandís day to day banking is carried out by the aforementioned. The full spectrum of banking services is afforded to citizens of New Zealand. The banking institutions are consistently ranked highly within the service sector as having great customer service and innovative solution oriented products. The customer relations interface of New Zealandís banking institution are indeed marvelous. All citizens have access to a branch to service their financial needs in metropolitan and rural areas, and it is not uncommon to see at least 5 banking institutions and a good number of ATMs in the smallest of towns; New Zealand banking reach is very high.

Source: http://www.teara.govt.nz/en/1966/banking

Personal

6. Communication Systems 4.0

New Zealandís communication infrastructure is decent by the world standards but not exceptional. News outlets number about 83 regional and local outlets. Furthermore, there are 1.88 million telephone lines, 4.9 mobile cellular subscriptions - more than the countryís total population, 3.9 million people or 89.5% of the population use the Internet, and broadband Internet subscribers total 1.24 million people. Therefore a simple deduction can be made that the country has achieved a high level of connectivity. In addition to comprehensive telecommunications, the media reach is fairly significant as well, with daily newspaper circulation at 745 000, radio stations numbering 418, television receivers at 3.0 million sets, and television stations numbering over 41. The only criticism here is that compared to the world New Zealand has some of the slowest network bandwidth speeds that it charges its subscribers a premium for. Average household connection speeds for 50NZD per month do not even top 1 Mbit, which isnít incredibly fast. The government made plans to introduce an ultrafast broadband initiative thatís still in the works.

Source: http://www.kidon.com/media-link/nz.php

Personal

http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10786737

http://www.philstar.com/world/2013/12/07/1265265/new-zealands-plan-faster-internet-hits-snag

7. Transportation 5.0

New Zealand has an excellent road network. Due to its small size and good government planning New Zealand maintains an excellent transportation infrastructure. Out of 94,160km of total road network 62,759km are paved and accessible by most vehicles. New Zealand has a great inventory of bus services, rail, shuttles, and ferries to move people back and forth across the country. The transportation is mostly affordable but sometimes the ferry service and flights across the country are ridiculously priced around peak times, which is made possible due to the monopoly certain companies have in that sector.

Source : http://www.fourcorners.co.nz/new-zealand/public-transport/

https://www.cia.gov/library/publications/the-world-factbook/fields/2085.html

8. Education 5.0

New Zealand has a fairly high rate of literacy, and every citizen is entitled to an education if they should desire one. Large majorities of New Zealanders 25- 64 years have attained secondary through tertiary educational qualifications. Educational Attainment level has placed New Zealand in the upper level of the OECD (Organization for Economic Cooperation and Development) scale, twelfth among 30 nations, it is ahead of Finland, behind Austria and beating the OECD average of 65 percent. New Zealanders placed great emphasis on early childhood education as well, 93% of the countryís 4 year olds were involved in early childhood education in 2000 and that has stayed consistent as an educational goal for the country. Literacy rates for New Zealand children often rank higher than international average. According to the internal statistics and corroborated by external entities, the literacy rates for New Zealand is 99% for New Zealanders 15 and over who can read and write.

Sources: https://www.cia.gov/library/publications/the-world-factbook/fields/2103.html

http://www.stats.govt.nz/browse_for_stats/government_finance/central_government/nz-in-the-oecd/education.aspx

http://data.worldbank.org/country/new-zealand

Personal.

9. Social Mobility 4.0

All citizens of New Zealand are subject to the Laws of the country and each afforded the same rights and opportunities. As a person from a lower socioeconomic background you can gain access to the highest levels of education and status; also having the ability to increase your earning potential without restriction based on your acquired skills and merit. The right to an education regardless of socioeconomic background is one basic entitlement. The public school system is excellent and fully funded by the government by province. Impoverished families can secure a tiered payment and loan program for higher education, and in many cases an education can be completely subsidized by the work and income department. New Zealand has an excellent welfare system that every citizen has access to. The country has frequently been called a socialist country in the past, but the system is effective at taking care of people in need. Jobs are available to those with the skills and relevant experience, and because of the mass exodus of skilled labor Ėdubbed locally as the ďBrain DrainĒ- to neighboring countries in search of higher incomes and better weather; there is a shortage of skilled labor in the country.

Source: http://newzealand.govt.nz/browse/social-welfare-support/

http://www.teara.govt.nz/en/1966/social-security

Personal

10. Freedom from outside control 3.0

As a member of the British Commonwealth, and several other transnational trading and security agreements, New Zealand citizens are free from the scrutiny or control of other countries, ruling bodies, and external organizations. Only the laws created by the New Zealand government and its elected officials govern every citizen. There have been allegations by the media in the past that foreign corporate entities have had too much control over the New Zealand economy and power to sway inner market workings. Some speculate that various ministers pander to the whims of foreign investors to secure lucrative contracts for personal gain. While this in practice does not affect every New Zealand citizen directly, there could be some macroeconomic effect over time.

Source: Personal.

11. Protection of Domestic Enterprises 3.0

The trading deficit of New Zealand is about 1.1B to 2.7B. This deficit affects New Zealand enterprises, which heavily depend on foreign investment and imports to operate successfully, but the government subsidizes local exporters with a host of tariffs and duties to boost enterprise competitiveness. The lack of a strong industrial base coupled with New Zealandís heavy dependence on agricultural and dairy produce exports to China, Singapore, United Kingdom, Australia and other significant trading partners make its domestic enterprises very vulnerable to crowding out in a market where they canít successfully compete. The dominance of New Zealand share market by foreigners also affects job creation and a steady labor force to supply an already ailing industrial complex.

Source: http://www.stuff.co.nz/business/industries/8452115/Current-account-deficit-blows-out

http://atlas.media.mit.edu/explore/tree_map/net_export/nzl/all/show/2010/

Personal

12. Foreign Currency Transactions 5.0

The only currency allowed to operate within New Zealand is the Kiwi Dollar (NZD). As a sovereign nation New Zealand mandates that the only currency permissible for trade within its economy and for general business use is the Kiwi Dollar. Consequently all foreign currencies must be converted to the local currency for use within the country. Without any opposing or negative influence on its dollar, the NZD operates with decent strength and economic stability.

Source: Personal.

13. Border Control 5.0

Geographically New Zealand is situated in a locale that makes border control relatively easy. As an island with no immediate neighbors except Australia who contributes heavily to New Zealandís border security, the country has no great need for advanced border security. To put in perspective the entire landmass of New Zealand is 2.95% the landmass of the entire United States and about the size of the state of Colorado. It employs only the singular customs department whose sole purpose is to enforce border security, collect customs duties, and protect New Zealand from prohibited import and exports.

Source : http://www.customs.govt.nz/news/stories/Pages/newborderprotectionsystemunveiled19112010.aspx

Personal.

14. Currency 5.0

The Official Currency of New Zealand is the Kiwi Dollar (NZD). It is the only currency that operates within the countryís economy. Due to the active tourism market many foreigners travel to New Zealand and as a result bring many different foreign currencies into the country, however, vendors and businesses only accept the Kiwi Dollar as the singular operating currency and thus any foreign currency must be converted into the local one. The New Zealand dollar is relatively strong and comparable to the Aussie, American and British Pound. Usually fluctuating within 50% - 80% of the stronger currencies. As a result, the Kiwi Dollar is very stable; it is a desired and traded currency in the global market.

Source: Personal.

15. Cultural, language homogeneity 4.0

The culture of New Zealand is a makeup of largely European, particularly British, and a substantial number of Maori and Polynesian Peoples. New Zealand is a bicultural environment with colonial and indigenous values intertwined in to the fabric of the country. There was some conflict between the indigenous and the usurpers that resulted in the Treaty of Waitangi to stop the erosion of the Indigenous lands, culture and identity. Globalization and Immigration Reform has broadened the scope of the culture, encompassing peoples from the Pacific Islands, East and South Asia, and Ethnic divisions are minimized by the populace who commonly refer to themselves as New Zealanders or colloquially ďKiwisĒ.

Source: Personal

http://www.roughguides.com/destinations/australasia/new-zealand/ http://www.stats.govt.nz/browse_for_stats/people_and_communities.aspx

16. Political Effectiveness 5.0

New Zealandís political effectiveness is fairly high; it governs its urban and rural sectors with a great degree of political efficiency. It responds to disasters very quickly and has a great infrastructure to do so Ėthe Christchurch earthquake response team was a prime example. New Zealandís democratically elected House of Representatives effectively make and pass new laws based on the majority vote. New Zealand has three main branches of government, Parliament, Executive, and the Judiciary. Parliament makes the law, the executive (ministers and the crown also known as government) administers the laws, and finally it is the judiciaryís role to interpret the law. This system allows for a great deal of transparency and is excellent for solving problems because its law-making facility is dynamic in nature allowing for changes that in practice affect the economic and political climate positively.

Source: http://www.parliament.nz/en-nz/about-parliament/how-parliament-works/our-system/00CLOOCHowPWorks111/our-system-of-government

Personal.

17. Institutional Stability 5.0

The government of New Zealand is a hybrid Constitutional Monarchy and with a Parliamentary Democracy and reasonably stable since 1891.The government has been in existence for 122 years. It is free from frequent internal conflicts, has not participated heavily or sustained significant casualties from external conflicts and wars. It hasnít experienced numerous AOG (Act of God) events excluding the recent Christchurch earthquake, which claimed the lives of 185 people. Foreign investment is heavy and continues to grow steadily and a good fiscal environment exists for businesses to thrive in. The political atmosphere is nonvolatile as there are only a select few parties, and usually a candidate from the Labor party or National party has won the election almost over a decade now. New Zealand experienced a tough economic climate a number of years ago and after systematic government restructuring is close to achieving the desired financial equilibrium.

Source: http://rulers.org/newzprov.html

Personal.

18. Honest government 4.0

New Zealand has been consistently ranked one of the least corrupt countries in the world. New Zealand scores high marks for securing its reputation as a country that prides itself on being free of corruption, however, there have been a few concerns about the fairness of political competition because of the concentrated ownership of the media, and the ability of said media to sway the country in a particular political direction. Political Integrity is definitely scrutinized by the SFO (serious fraud office) who strive to eliminate and seek 100% conviction rates in fraud cases that involve police corruption, tax and welfare fraud, affinity crimes, corporate fraud, and general public sector corruption.

Source: http://www.pwc.co.nz/todays-challenges/

http://www.sfo.govt.nz/sfo-history

http://www.transparencynz.org.nz/

19. Common Laws 5.0

The New Zealand legal system is based heavily on English Law since it was a ďformerĒ British colony. The law applies to everyone and does not favor any particular social class of people over another Ė everyone is equal in the eyes of the law - The legal system operates under a few simple principles, rule of law, the separation of powers, and parliamentary sovereignty. New Zealand has three tiers of courts Supreme Court, District Courts and Magistrates courts; these courts effectively deal with most public cases effectively and it is a characteristic of English Law to follow the Law to the letter to avoid public controversy. Legal aid is also effectively distributed and accessible to those in need, and it covers a wide variety of cases: criminal offenses, family disputes, and civil disputes.

Source: http://www.teara.govt.nz/en/1966/law-history-of/page-3

http://www.justice.govt.nz/services/legal-help/legal-aid

20. Central Bank 5.0

RBNZ (Reserve bank of New Zealand) is the central bank in New Zealand. It is free from control by any political groups, pressures or organizations, and is 100% owned by the New Zealand Government. Any surplus revenue generated gets deposited into crown accounts. RBNZ is responsible for the monetary policy and currency, it does not offer any direct financial services to the public, and its primary function is the ďstability in the general level of pricesĒ by responsibly managing monetary policy to maintain price stability. Other auxiliary functions the RBNZ carries out are supervision of the insurance industry under the prudential supervision act. Supervision of the New Zealand banking system and registered banks and under the Reserve Bank of New Zealand Amendment Act 2008 enforce the credit rating and requirements applying to non-bank deposit takers.

Source: http://www.rbnz.govt.nz/monetary_policy/about_monetary_policy/0072140.html

http://www.teara.govt.nz/en/reserve-bank

http://www.rbnz.govt.nz/regulation_and_supervision/non-bank_deposit_takers/3857991.html

21. Domestic Budget Management 3.0

New Zealand actually posts a budget deficit of about 2 billion due to unexpected earthquake costs for the fiscal year 2013-14 and reports that they are on track to achieve a surplus of about 197 million for the 2014/15 financial year. New Zealandís government main focus for upcoming years includes investing heavily in infrastructure, innovation, skills, creating a more innovative and efficient public sector, and rebuilding Christchurch. Expenditure breakdown using 2011 estimates: Total Government revenue 43.1 billion (38.1% of GDP), General Government expenditure 32 billion (18% of GDP)

Source: http://www.beehive.govt.nz/release/competitive-economy-surplus-heart-budget

22. Government Debt 3.5

New Zealandís debt sits at a currently manageable figure of 60.6 billion. When related to its GDP of 169.68 billion, debt to GDP percentage is 35.36. The debt ratio is held under 50 percent of GDP, which makes this figure relatively reasonable in comparison to other countries with similar economies. Alternatively though, New Zealandís net foreign debt is substantial at 141.65 billion or 85.75 percent of GDP, and has been trending upwards for the last 5 years.

Source: www.stuff.co.nz/national/politics/9380846/Public-debt-climbs-by-27m-a-day

rbnz.govt.nz/statistics/

23. Economic statistics 5.0

New Zealand provides a plethora of business and economic statistics and other resources that are curated by the government, and well known and fully utilized by citizens of New Zealand. Several prominent news outlets regular use the statistics provided in their editorials and publications. Businesses are closely regulated and have to provide a number of mandatory operation related reports to the government. There is an actual economic statistics website that provides plentiful information for just about anything related to the New Zealand economy Ė www.stats.co.nz.

Source- Personal.

http://www.nzherald.co.nz/lifestyle/news/article.cfm?c_id=6&objectid=10871672

www.stats.co.nz

24. Protection of public health and safety 5.0

New Zealand has an excellent infrastructure for health and public safety. The country has an efficient statutory health system made up of over 20 pieces of legislation that are well funded and accessible to every citizen. New Zealandís healthcare actís main purpose is to safeguard public health and outlines provisions for environmental health, emergencies, national cervical screening, and infectious diseases. The programs are comprehensive and effective. Life expectancy is 80 years and the infant mortality rate is one of the lowest at 4.65 deaths/1,000 live births - 2013 estimates, and New Zealand has one of the lowest tuberculosis rates at 25.5 deaths per year.

Source: https://www.health.govt.nz/new-zealand-health-system/overview-health-system/statutory-framework

https://www.cia.gov/library/publications/the-world-factbook/fields/2091.html

http://www.arphs.govt.nz/Portals/0/Health%20Information/Communicable%20Disease/Tuberculosis/2013%20Tuberculosis%20fact%20sheet/TB%20statistics%20and%20key%20facts%2017%20Jan%202013%20-%20Fact%20Sheet.pdf

25. High wage policies 4.0

New Zealand has a fairly high ranking when it comes to standard of living.

Unemployment is fairly low at around 6.8% and steadily falling. The average salary in New Zealand is $55 000 and the minimum wage is $13.75 an hour, a very decent marginal tax rate for someone on an average salary is %17.5. Average workweek is 40 hours with a mandated number of breaks during a regular workday Ė 3 to be exact. Although the quality of life is above average, food is fairly expensive but rent and housing being extremely affordable countrywide. New Zealand has an excellent social welfare, healthcare system and income protection that is affordable to almost every worker. Wage policy and workplace quality are scrutinized heavily by the government through the Employment Relations Act which gives the government authority to audit companies and secure a procedure for personal grievances, a disputes procedure, a term with an expiry date for collective agreements, wages, hours of work, holidays, sick leave entitlements for employees.

Source : http://www.immigration.co.nz/life-new-zealand/salaries/

http://www.dol.govt.nz/er/pay/minimumwage/index.asp

26. Environmental Protection 5.0

New Zealand has a very strong focus on protecting its environment and populace from biohazards. It is a top priority in the country, various organizations, a strict building code and environmental regulations, and rigorous border control task force monitor all produce and products in and out of the country. New Zealand has over 50 environmental policies such as the clean air act, climate change response act, hazardous substances and new organisms act, scenery protection act, marine reserves act, waste minimization act and many others that ensure New Zealand keeps its impeccable scenery and delicate ecology in perfect balance. New Zealand is a nuclear free zone and ranked in the top ten of the most beautiful places in the world.

Source: http://www.epa.govt.nz/Pages/default.aspx

personal

27. Strong army 2.0

New Zealand more or less stands as a neutral country that abstains from taking part in any foreign conflicts unless national interests or security are directly threatened. However, New Zealand does not have a particularly strong and active army, its primary role is often to provide support in peacekeeping missions and search and rescue operations. New Zealandís army is paltry in comparison to its closest neighbor, total armed forces number = 20 000 personnel that include army, navy, air force and reserves. Consequently, if an external hostile force attacked the country it would lean heavily on defense agreements and allied forces to protect itself. New Zealand has a military fit population of 1.6 m people and its evident the government does not allocate a significant amount towards military expenditures to recruit and expand; the total military budget is 1% of NZís GDP, less than one-third the domestic budget.

Source: https://www.cia.gov/library/publications/the-world-factbook/geos/nz.html

28. Foreign trade impact 4.0

With import and exports being 30% of NZís GDP it shows that New Zealandís foreign trade impact is marginal which is unsurprising for a country with a 4.6 million total populace. New Zealand is a small country that relies heavily on foreign trade. New Zealandís negative net exports balance is due to the dependence on a massive influx of imported goods for its burgeoning industry. New Zealand exports a wide variety of goods; with its largest grossing exports category being overwhelmingly foodstuffs and dairy products i.e. Milk and cream, Lamb meat, Butter, Bovine meat (frozen), Fresh cheese etc. Foodstuffs and dairy products represent half the total exports in New Zealandís economy.

Source: http://atlas.media.mit.edu/explore/tree_map/export/nzl/all/show/2010/

http://data.worldbank.org/indicator/NE.EXP.GNFS.ZS

29. Management of foreign currency budget 3.0

New Zealandís net export position is a deficit of 1.14B after exports totaled 46B in 2011-2012.The trade deficit is less than 0.6% of New Zealandís GDP. This trade imbalance on net exports supports the reality of New Zealandís dependence on imported goods to meet demand within its economy. It also illustrates clearly the lack of strong internal production and as a result highlights the $208B NZD foreign debt. Foreign debt is 124% the countryís GDP, this significant government debt shows the dependence on foreign markets for goods and services.

Source:

http://www.stats.govt.nz/tools_and_services/nzdotstat/imports-and-exports-tables.aspx

http://www.interest.co.nz/charts/economy/overseas-debt

30. Layers of Collective Action 5.0

New Zealand has a strong central government but has exceptional district and local offices that can interface with their respective community. New Zealand doesnít have a constitution as such but the country still functions by electing officials every 3 years in a mixed member proportional representation system of 120 MPs that represent a particular area geographically. No branch of government has too much power because power is distributed between the legislatures, the courts, and the executive branch Ė which comprises the government departments, local bodies and the ruling party. There is also a vast local government system of elected officials from the community that provide infrastructural and a planning framework for their respective areas and work on solutions to local issues.

Source: https://www.newzealandeducated.com/int/guide/on_arrival/government_services

http://www.localcouncils.govt.nz/lgip.nsf/wpgurl/About-Local-Government-Local-Government-In-New-Zealand-Index

31. Pro - business climate 5.0

New Zealand has a great business climate, people tend to respect businesses and businessmen in New Zealand. Considering the low cost to establish a business, a decent education system with emphasis placed on trades/apprenticeship to promote jobs for industry, New Zealand people overall supports the growth of business within its economy. Although New Zealand lacks a significant industrial and manufacturing base it subsidizes heavily entrepreneurship in the manufacturing sector. A free market climate and a thriving import goods market allow investors and foreign businesses to also trade in the New Zealand market without restriction, heavy penalties and public objection.

Source: http://www.radionz.co.nz/news/national/230168/global-trade-deal-benefits-'limited'

Personal.

32. Government Enterprises 3.0

New Zealand government controls 14 state owned enterprises in core public sectors as opposed to the 21 former state owned enterprises. The privatization of some prominent businesses of which include a bank, steel company, energy company, radio company, and a major rail company indicate the governmentís disposition to having corporations maintained and owned by the private sector.

Privatization is mostly viewed as a positive thing in New Zealand, seeing as New Zealand doesnít have the labor force, especially a skilled labor force required to support the businesses there due to a high cost of living in the country and non-comparable wages. There is a mass exodus of labor into neighboring countries Ė mainly Australia Ė for higher paying jobs. New Zealand government is pushing to maintain its labor force and considering the low unemployment rate, privatization not only boosts it economy but allows the entry of skilled workers from other countries to migrate to New Zealand.

Source: http://www.legislation.govt.nz/act/public/1986/0124/latest/DLM98444.html

33. International Security Agreements 5.0

New Zealand has a working and strategic military partnership with Australia and the US, highlighted by their 1951 merging into the ANZUS security treaty. As a member of the British Commonwealth, New Zealand maintains openly, that as a trading nation, its well-being is directly related to the international and regional security environment. As a result New Zealand prioritizes security alliance commitments to Canada, United Kingdom, surrounding and outlying Pacific Nations, United States and Australia. As a member of the five power defense arrangements it has engaged in multiple campaigns of support operations and counter-terrorism roles in Afghanistan, Korea, Somalia e.t.c.

Source: http://australianpolitics.com/topics/foreign-policy/anzus-treaty-text

http://www.nzembassy.com/usa/relationship-between-new-zealand-and-usa/new-zealand-and-usa/defence-relations

34. Protection of Domestic Enterprises from Government Mandated Costs. 4.0

Costs are relatively low for companies that opt to do business in New Zealand, there are no significant government mandated costs that prevent barrier to entry in doing business. New Zealand Government maintains a strong excise and sales tax policy that generates about a third of the government revenue. There are import tariffs in place that also help the local market. New Zealand also provides a plethora of resources to encourage the growth of small business within its economy. New Zealand is ranked third out of 185 economies surveyed comprehensively in the context of ease of doing business; indicators where it led included: time and cost to incorporate a company, ease of getting credit, business tax rate e.t.c

http://www.doingbusiness.org/data/exploreeconomies/new-zealand/#paying-taxes

http://www.teara.govt.nz/en/customs-and-tariffs/page-4

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CONTENTS OF SITE

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Introduction and Policy Recommendations

Winning Essays: There Are Alternatives Project (TAA)

Essay: Balanced Trade: Toward the Future of Economics

Moral Economics

MIKE P. McKEEVER INSTITUTE of ECONOMIC POLICY ANALYSIS

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