New Zealand Economy Facts
The export-dependent New Zealand is still a prominent agricultural country. The production of dairy products, meat and wool was built up in the 19th century for the British market but is of great importance to the New Zealand economy also in the 2000s. Fishing and forestry also provide important income.
Agriculture accounts for only a few percent of gross domestic product (GDP) but generates a large portion of export revenue and provides foreign currency. It also underlies much of the manufacturing industry, which has developed at a rapid pace and accounts for a growing share of exports. The service sector accounts for over two-thirds of GDP and tourism is of great economic importance.
- Countryaah.com: Major imports by New Zealand, covering a full list of top products imported by the country and trade value for each product category.
In the 1980s and 1990s, the economy was deregulated following problems with large budget deficits, high government debt and a currency that was losing value. Government companies were privatized, subsidies were removed and price controls were abolished. It was a turbulent time with poor growth. The radical transformation of the economy led to increased unemployment and created political contradictions.
From being one of the most regulated and subsidized economies in the industrial world, the New Zealand economy is now considered one of the most open. During the 2010s, New Zealand has been at the top of several lists of the world’s best business climate for foreign investors.
The economy has depended on favorable weather for agriculture and high world market prices for a few goods. The country has therefore sought to broaden its economic base, including in knowledge-based production, such as biotechnology. New export products and new markets have reduced the vulnerability of the economy to some extent. In addition, raw materials are processed to a greater extent than before they are exported.
In the years 2000-2007, the economy grew by an average of 3.5 percent per year. Government spending increased, but at the same time taxes were raised to finance investments in health care and care.
- Abbreviationfinder.org: Check this abbreviation website to find three letter ISO codes for all countries in the world, including ZK which represents the country of New Zealand. Check findjobdescriptions to learn more about New Zealand.
As a result of the global financial crisis of 2008, private consumption slowed down as exports fell. GDP fell by 3 percent in 2009, but the economy recovered quickly. Already in 2010 GDP grew again and in the coming years growth continued to be better than in both EU countries and the US. The recovery was led by the export industry, which was boosted by significant demand from the two major markets Australia and China. The rebuilding after the Christchurch earthquake in 2011 also helped stimulate the economy through large multi-year construction projects and other infrastructure investments. The growth rate continued to be good for the next five years, although it was somewhat dampened when the important dairy exports were partly affected by lower world market prices for milk,
New Zealand’s external debt increased sharply during the financial crisis. However, with the help of a strict budgetary policy, the government managed to reduce its loans to just over one fifth of GDP towards the end of the 2010s – which is low compared to many other developed economies. The country has also succeeded in turning the previous budget deficit into a surplus. At the same time, economic growth has continued to be good and unemployment low, which has enabled the Labor-led government to invest in strengthening welfare in the country.
But there are also some economic clouds of concern. Experts have warned about the high indebtedness among New Zealand households while housing prices continue to rise. There are also continuing problems with deep income gaps.
FACTS – FINANCE
GDP per person
US $ 41,966 (2018)
US $ 205,025 million (2018)
2.8 percent (2018)
Agriculture’s share of GDP
6.6 percent (2016)
Manufacturing industry’s share of GDP
10.0 percent (2016)
The service sector’s share of GDP
65.6 percent (2016)
1.4 percent (2019)
Government debt’s share of GDP
29.8 percent (2018)
New Zealand dollar