The U.S. Department of State’s Investment Climate Statements provide information on the business climates of more than 170 economies and are prepared by economic officers stationed in embassies and posts around the world.  They analyze a variety of economies that are or could be markets for U.S. businesses.  The Investment Climate Statements are also references for working with partner governments to create enabling business environments that are not only economically sound, but address issues of labor, human rights, responsible business conduct, and steps taken to combat corruption.  The reports cover topics including Openness to Investment, Legal and Regulatory Systems, Protection of Real and Intellectual Property Rights, Financial Sector, State-Owned Enterprises, Responsible Business Conduct, and Corruption. 

The U.S. Department of State Investment Climate Statements provide information on the business climates of more than 170 economies and are prepared by economic officers stationed in embassies and posts around the world.  These statements highlight the protection and enforcement of intellectual property Statement rights in foreign economies.  To access the ICS, visit the U.S. Department of State Investment Climate website. 

Executive Summary 

After weathering the pandemic better than most countries, the New Zealand economy has begun to overheat. Net debt to GDP has increased from 19.5 percent prior to the onset of Covid restrictions to 34.5 percent at the end of 2021. The increase in debt has been due in part to spending measures the government has undertaken for Covid response and recovery. These measures were able to support economic activity during extensive Covid-related domestic lockdowns and travel restrictions, but along with supply chain disruptions, they have begun to contribute to higher inflation. Nationwide labor shortages across a variety of sectors have also had a sizeable impact on the economy. In response to war in Ukraine, the New Zealand government rapidly passed historic sanctions legislation targeting individuals, companies, and assets associated with Russia’s invasion. Sanctions are expected to have a limited direct impact on the investment climate in New Zealand. 

While a swift border closure and the imposition of lockdowns originally helped stamp out community transmission of Covid, the appearance of the Omicron variant in January 2022 resulted in an outbreak that put pressure on the health system. At time of writing, border restrictions were being phased out in favor of a management approach to the pandemic. The government announced its plans to open the New Zealand border to travelers from visa-waiver countries on May 1. By October, it is expected that the border will fully reopen. Since 2020, the tourism sector has suffered the most, while primary exports and the housing market have helped to sustain the economy. Unemployment is currently 3.2 percent, a record low. 

New Zealand has an international reputation for an open and transparent economy where businesses and investors can make commercial transactions with ease. Major political parties are committed to an open trading regime and sound rule of law practices. This has been regularly reflected in high global rankings in the World Bank’s Ease of Doing Business report and Transparency International’s Perceptions of Corruption index. New Zealand is party to a multitude of free trade agreements (FTA). In February 2022, the country signed its latest, an FTA with the United Kingdom. 

Successive governments accept that foreign investment is an important source of financing for New Zealand and a means to gain access to foreign technology, expertise, and global markets. Some restrictions do apply in a few areas of critical interest including certain types of land, significant business assets, and fishing quotas. These restrictions are facilitated by a screening process conducted by a government agency. 

The current Labour-led government welcomes productive, sustainable, and inclusive foreign investment, but since being elected in October 2017 and reelected in October 2020, there has been a modest shift in economic priorities to social initiatives while continuing to acknowledge New Zealand’s dependence on trade and foreign investment. Cabinet has agreed a whole-of-government framework that will drive climate change policy. This national initiative is currently underway to reduce the country’s emissions and is developing a pathway for farmers to reduce agricultural emissions. The rapidly developing digital and e-commerce landscape is supported by government initiatives that expand the knowledge base, while making a priority of digital inclusion. Along with its focus on post-pandemic recovery, the New Zealand government has invested in a digital, innovative future that aims to secure multilateral agreements with e-commerce rules that address the complexities of the evolving digital economy. 

The 2022 Investment Climate Statement for New Zealand uses the exchange rate of NZD 1 = USD 0.70