Discusses key economic indicators and trade statistics, which countries are dominant in the market, and other issues that affect trade.
New Zealand offers U.S. companies a wealthy, sophisticated market with a very transparent and open business environment and a stable democratic system. New Zealand consistently ranks high in measures of business honesty and integrity, and these features tend to offset the small market size. (Population: 5 million.)
New Zealand’s response to COVID-19 helped protect New Zealanders from the worst of the pandemic and despite the disruption over the past two years, the country’s economy performed well. However, due to a combination of global trading factors, New Zealanders are facing a rising cost of living for most products and services. Inflation was recorded as 6.9% for the March 2022 annual quarter.
The foundation of New Zealand’s economy is the export of agricultural commodities such as dairy products, meat, forest products, fruit and vegetables, and wine. Dairy is the lead export commodity – in 2021 New Zealand dairy exports totaled approximately US$12 billion. In 2021, New Zealand exports to the U.S. totaled US$4.9 billion, approximately 10% of New Zealand’s total exports. Fluctuations in the NZ/US exchange rate can impact on New Zealand dollar export receipts. Exchange rate: 1 NZ$ = 63 U.S. cents (as of May 2022).
The United States is New Zealand’s third largest trading partner after China and Australia, with whom New Zealand has Free Trade Agreements. (New Zealand does not have a Free Trade Agreement with the United States.) In 2021, New Zealand imports from the U.S. totaled US$3.7 billion. U.S. agricultural machinery, ICT, and healthcare products are key items sold to New Zealand.
New Zealand is one of a few countries to have a zero-emissions goal enshrined in law. The act aims to achieve net zero-emissions of almost all greenhouse gases by 2050. For business this means adopting new technologies and investment choices, e.g., introduction of electric vehicle fleets.