New Zealand Economy

New Zealand Economy

When New Zealand officially became independent from its mother country Great Britain by signing the Westminster Adoption Act in 1947 and dissolved the relationship of colonies, it seemed as if it had acquired all the sovereignty and power of an independent nation. Economically speaking, New Zealand overcame the separation from England in the 1990’s, when it overcame its longest and largest economic crisis to date.

Tourism and agriculture are currently the mainstays of New Zealand’s economy. While tourism is still a relatively young branch of the economy that has only established itself as such in the past two decades, agriculture has played an important role from the start.

In the 19th century this was based almost exclusively on the export of New Zealand wool, gold, meat and dairy products. Over half of all New Zealand exports went to Great Britain, whose colony New Zealand had originally been. But even after New Zealand became independent in 1947, the trade relationship continued. Other customers were the other European countries and North America.

His first economic boom experienced New Zealand from 1935 to 1970, after the Great Depression (Great Depression) and later the Second World War was over. In Great Britain, as in other European countries, there was an enormous demand for goods New Zealand could supply. It was a time of prosperity. And the beginning of the welfare state. Various social regulations, including state health insurance, were introduced. The government tightened its controls on trade, money and labor markets. The unemployment rate has never been lower.

In 1973 the tide turned dramatically: Great Britain joined the European Community (EC), the forerunner of the European Union (EU). For New Zealand this meant the end of the protected trade relationship. Suddenly he was missing his biggest and most reliable customer. New Zealand found itself in international competition and was not prepared for it. The conservative national government under Prime Minister ROBERT MULDOON responded with large investment projects to stimulate the economy and move New Zealand forward in new areas, such as industry.

The motto of the hour was Think Big. The national debt rose rapidly, but the projects did not work and so the number of unemployed also rose. Economic conditions subsequently deteriorated so much that New Zealand citizens began to migrate en masse. The opening up of a common market with Australia in 1983 did not solve the problem either.

In 1984 the Labor Party came to power under DAVID LANGE. The left-liberal government tried to initiate the much-awaited change with radical reforms. After the then finance minister ROGER DOUGLAS, the New Zealanders named these reforms Rogernomic . A flexible exchange rate was introduced, state control over prices, interest rates and international capital movements were abolished, as was quantity controls for imported goods. The tariffs were lowered dramatically and state institutions were privatized. In short: the economy and agriculture were almost completely deregulated, and foreign trade diversified.

Nevertheless, economic growth continued to stagnate, and the number of unemployed rose steadily. A stock market slump. In 1987 the situation worsened. Even so, the following Labor governments thought it wiser to stick with rogernomics.

The crisis had reached its peak at the end of the 1980’s. The number of unemployed was higher than since the Great Depression.

In 1990 the National Party was elected to power. The new government under Prime Minister Jim Bolger took rogernomics and drove them ahead vigorously: they reformed the social services – a measure before the Labor Party has always shrunk back. State health insurance was abolished, and many other social benefits were either discontinued or restructured.

In terms of domestic politics, this created the prerequisites for finally overcoming the crisis.

By joining numerous alliances and organizations, during this time increasingly with countries in the Asian and South Pacific region, New Zealand also managed to secure and expand a place in international competition. In the meantime it has found its position in the world economy and enjoys an excellent reputation, it is considered a prime example of a flourishing market economy. According to necessaryhome, New Zealand is still an export country. In its economic policy it pursues two goals: to keep its traditional sales markets for agricultural goods in Europe and to bind the Asian and South Pacific region more closely through alliances and trade agreements.

Today’s most important trading partner is neighboring Australia, with which New Zealand has been operating free movement of goods since the CER (Closer Economic Relations) agreement in 1990. It also signed the SPARTECA (South Pacific Regional Trade And Economic Cooperation Agreement) and is a member of APEC (Asia-Pacific Economic Cooperation).

New Zealand is a member of the OECD (Organization for Economic Cooperation and Development), the WHO (World Trade Organization) and the IMF (International Monetary Fund World) connected.

New Zealand has expanded its range of agricultural exports over the years. The most important and sought-after products today are lamb, sheep and beef, wool, fruits (above all the kiwi), vegetables, fish, dairy products, textiles and wood products.

More recently, wine and, to a lesser extent, electronic products have appeared. The most important customer countries are Australia, the EU, USA, Japan and China. Because the industry in New Zealand is still barely developed, industrial products dominate imports. The main import goods are petroleum, consumer goods, vehicles, machines, minerals, chemical products and plastics.

New Zealand Economy