New Zealand

Darrin Agar

Overall Score: 82.1 World Rank:3

New Zealand Quick Facts/United States

  • Population: 4.5 Million / 316.4 Million
  • GDP: $136.6 Billion / $16.8 Trillion
  • GDP Growth: 2.4% / 1.9%
  • GDP Per Capita: $30,493 / $53,101
  • Unemployment: 6.4% / 7.5%
  • Inflation: 1.1% / 1.5%
  • Foreign Direct Investment: $986.5 Million / $187.5 Billion

Legal System

New Zealand is very free from corruption. It is tied in first place with Denmark in the Transparency International’s 2013 Corruption Perceptions Index. New Zealand works very hard to create a transparent and corruption-free government. The judicial system is independent and works well, and private property rights are strongly protected.

Competitive Markets

New Zealand has a very open market, Which means that it is very competitive. This helps support economic progress because people are trying to make the most profit, but still keep the price good enough to warrant good sales. New Zealand also has a transparent and efficient entrepreneurial framework. Starting a business only takes around 1 day on average, which makes the market even more competitive because so many people are trying to get to the top.

Limits on Government Regulation

Government regulation is very light in New Zealand. As stated before, It only takes one day to start a business, which is a much shorter waiting time than many other countries. They have a flexible labor market, with moderate non-salary cost and a flexible work hour regulation, which helps out multiple people with jobs. They have the lowest amount of subsidies in any other country, because they removed all farm subsidies to spur the development of a diversified agriculture sector.

An Efficient Capital Market

New Zealand has a good efficient capital market. They have much foreign investment freedom, but when investments are in large amounts, they may screen it. This helps economic progress because investments help expand the country to do more things. The open financial sector is very well developed which makes it very competitive.

Monetary Stability

New Zealand is generally monetarily stable. It's monetary freedom is very high, with a higher score than the United States. It has high financial freedom. Fiscal freedom is not as high as the rest of its score, but it is at the same level of the United States.

Low Tax Rates

The top income tax rate is 33%, which is lower compared to the United States 39.6%. The top corporate tax rate is 28%, which is pretty average. New Zealand has a goods and services tax, which puts 15% tax on all goods except for select items like precious metals and housing, but they don't have many other taxes like sales tax.

Free Trade

New Zealand’s average tariff rate is 1.6%, which is almost tied with the United State's 1.5%. Non-tariff barriers are low due to participation in trade agreements.