OECD Economic Surveys: New Zealand

English
Frequency
Every 18 months
ISSN: 
1999-0162 (online)
ISSN: 
1995-3100 (print)
DOI: 
10.1787/19990162
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OECD’s periodic surveys of the New Zealand economy. Each edition surveys the major challenges faced by the country, evaluates the short-term outlook, and makes specific policy recommendations. Special chapters take a more detailed look at specific challenges. Extensive statistical information is included in charts and graphs.

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OECD Economic Surveys: New Zealand 2017

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English
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    http://oecd.metastore.ingenta.com/content/1017121e.pdf
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Author(s):
OECD
15 June 2017
Pages:
176
ISBN:
9789264277120 (PDF) ; 9789264277151 (EPUB) ;9789264277113(print)
DOI: 
10.1787/eco_surveys-nzl-2017-en

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New Zealand is enjoying strong economic growth, driven by booming tourism, high net immigration, solid construction activity and supportive monetary policy. The fiscal position is sound, with low public debt and a balanced budget. The major economic vulnerability emanates from high levels of household debt associated with rapid increases in house prices, which have reached high levels relative to fundamentals. Barriers to expanding housing supply are being reduced, and macro-prudential measures have been taken to contain financial stability risks, but further measures may be needed. While the short-term economic outlook is strong, there are longer-term challenges from low productivity growth, a changing labour market and some growing environmental pressures. Addressing these challenges would secure sustainable improvements in well-being for all New Zealanders.

SPECIAL FEATURES: IMPROVING PRODUCTIVITY; THE CHANGING LABOUR MARKET

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  • Basic Statistics of New Zealand, 2016
  • Abbreviations and acronyms
  • Executive summary

    New Zealand continues to enjoy a strong, broad-based economic expansion

  • Assessment and recommendations

    New Zealand is enjoying a strong, broad-based economic expansionEnsuring price and financial stabilityAdjusting fiscal policy to enhance growth and prepare for future shocks and population ageingImproving productivityAdapting to the changing labour marketMaking growth more environmentally sustainable

  • Progress in structural reform

    This Annex reviews actions taken on recommendations from previous Surveys that are not covered in tables within the main body of the Assessment and Recommendations. Recommendations that are new in this Survey are listed at the end of the relevant chapter.

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  • Expand / Collapse Hide / Show all Abstracts Thematic chapters

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    • Improving productivity in New Zealand's economy

      New Zealand ranks highly on most indicators of well-being, but incomes are below the OECD average due to low labour productivity. Low labour productivity is only partly explained by the industry composition of the NZ economy and is primarily a consequence of sustained low multi-factor productivity growth within industries, as well as weak investment. Economic geography is an important factor in New Zealand’s poor productivity performance, as the small size and remoteness of the economy diminish its access to global markets, the scale and efficiency of domestic businesses, the level of competition, and the ability to benefit from innovation at the global frontier. Policy and institutions are generally supportive of productivity growth, but there are a number of areas where there is scope for reforms that would help offset the country’s geographical disadvantages and improve the welfare of New Zealanders over the coming decades. This includes promoting international connections, removing barriers to fixed capital investment (including taxation), accessing benefits from agglomeration by improving urban planning and infrastructure provision, enhancing competition and increasing investment in innovation and intangibles.

    • Adapting to the changing labour market

      Technological change is increasing the productivity of highly skilled workers but creating more challenging labour-market conditions for their low-skilled counterparts. These pressures are likely to grow, especially in light of progress being made in Artificial Intelligence. The NZ labour force is upskilling to meet these challenges, but more progress will be needed to keep ahead of the race with technology. Young New Zealanders will need to continue their education to higher levels than in the past and acquire skills that are more highly valued in the labour market. To maintain valuable skills, workers of all ages will need to engage more in lifelong learning. Some will need to retrain when their occupation becomes obsolete. Getting the most out of skills will also depend on allocating skills to their most productive uses. Reducing New Zealand’s high rates of qualification and skills mismatches would boost both wages and productivity. With the possibility of more workers being displaced than in the past, greater efforts may need to be considered to help them get back into jobs.

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