New Zealand’s Economic Performance 2004 – 2013

New Zealand’s Economic Performance 2004 – 2013

Introduction – An Overview of the Economy

New Zealand is a small and far away country that has seen many disproportionate economists over the years. New Zealand’s Gross Domestic Product per capita from the year 2004 to 2013 averaged 28 thousand US dollars at the end of 2013. It was the world’s third richest country in the 1950s but had dropped to the twentieth position by the 1970s (The Economist, 2000). Unemployment rate averaged out to 5% of the total labour force throughout these ten years. As New Zealand has lots of green pastures, they are dealing mainly in agriculture and exporting the final goods out to neighbouring countries. Some of the countries that they export out to are Singapore, Australia, United States and Japan. New Zealand’s exports out to neighbouring countries makes up over 40% of their Gross Domestic Product.

New Zealand has been facing some constraints in the fields of infrastructure, skills and housing. There has also been a rise in skills shortages in the management occupations and construction trades. Auckland faces a severe housing shortage due to the increasing population but lack of available supply (Luu, 2015). Inflation rate rose drastically in 2007 and 2013 with 5.1% and 4.1% respectively due to the financial crisis throughout the world. The World Bank has ranked New Zealand as the easiest country in the world to start a business. There are not many restrictions on operating, owning, and establishing a business in New Zealand.

Production Output Performance Analysis

New Zealand’s Real Gross Domestic Product in 2004 was 111 Billion US Dollars which rose the following year to 115 Billion US Dollars. The Real Gross Domestic Product rose until 121 Billion US Dollars in 2007 but dipped slightly to 119 Billion US Dollars in 2008 and 2009. The Real Gross Domestic Product rose again in 2010 to 121 Billion US Dollars and has been steadily rising about 3 Billion US Dollars yearly until 2013. The figures above enable us to clearly identify the market value of all the services and final goods produced in New Zealand at any given period of time (Study Guide pp.113).

New Zealand’s Real Gross Domestic Product Growth in 2004 was 3.8% but dipped slightly to 3.4% the following year and continued to decline until -1.6% in 2008. There was a slight increase in 2009 but was still at a negative which was -0.25%. 2010 was a much better year for New Zealand as the Real Gross Domestic Growth rate had rose to 1.44% and steadily climbed until 2013. New Zealand was going through a recession in 2008 and 2009 and only managed to recover from the recession in 2010. The figures above enable us to clearly identify that New Zealand’s Real Gross Domestic Product Growth had declined to a negative in 2008 and 2009 due to the financial crisis in 2007.