All About New Zealand
New Zealand is a country located on an island in the southwestern Pacific Ocean. The total area of the landmass measures 103,500 square miles or 268,021 square kilometres divided into two main areas – North and South Island, – and includes around 600 smaller islands. It lies across the Tasman Sea approximately 2,000 miles east of Australia and about 600 miles south of the New Caledonia, Fiji, and Tonga islands. New Zealand has a varied topography with sharp mountain peaks like the Southern Alps that owe much of their existence to tectonic uplift and eruptions from volcanoes.
New Zealand is a developed country as it ranks highly among other developed countries with regard to its national performance such as education, economic freedom, government transparency, and protection of civil liberties. New Zealand’s most populous city is Auckland and Wellington is its capital.
Thanks to its advanced market economy, in 2018 New Zealand was ranked 3rd in the Economic Freedom Index and 16th in the Human Development Index. It has a high-income economy with a GDP (Gross Domestic Product) of US$36,254 per capita.
The largest sector of New Zealand’s economy is the service sector followed by manufacturing, construction, farming, and then raw material extraction. Tourism contributes a significant $12.9 billion (5.6%) to the total GDP of the country and in 2016 it supported approximately 7.5% of the country’s total workforce. Before the pandemic international tourist numbers were expected to increase at a rate of 5.4% annually, however, Covid-19 restrictions have battered the tourism sector to such an extent that it has almost been brought to a standstill.
Dairy products accounted for $14.1 billion (17.7%) of total exports in the year to 2018 with one of the largest dairy companies, Fonterra, controlling almost a third of the country’s international exports. Other exports between 2017 and 2018 included meat at 8.8%, wood products and wood at 6.2%, fruit at 3.6%, machinery at 2.2%, wine at 2.1%. Following a similar trend to the dairy industry, wine sales almost doubled over the same period, for the first-time overtaking wool exports in 2007. During the global pandemic, the wine industry in the country enjoyed considerable success with more New Zealand wine being imported by other countries.
Extractive industries have historically been strong contributors to the economy with industries like whaling, sealing, kauri gum, gold, flax, and native timber being focused on at different times. Dairy and meat exports to Great Britain was established in 1882 with the first shipment of New Zealand refrigerated meat on the Dunedin. The basis of this trade spearheaded strong economic growth in the country.
During the 1950s to 1960s, a high demand for agricultural products from the United States and United Kingdom contributed to higher living standards for New Zealanders that transcended that of both Western Europe and Australia. Successive governments since 1984 have engaged in major macro-economic restructuring that rapidly transformed the country from a highly regulated and protected economy to a liberalised, free trade economy.
The economy of New Zealand depends heavily on international trade, particularly agricultural products. Because exports account for almost 24% of New Zealand’s output, this puts the country in a vulnerable position with regards to global economic slowdowns and international commodity prices. In 2014, food products made up 55% of the value of all New Zealand’s exports with wood at 7% coming in as the second largest. Main trading partners include China at NZ$27.8 billion, Australia at NZ$26.2 billion, The European Union at NZ$22.9 billion, The USA at NZ$17.6 billion, and Japan at NZ$8.4 billion.
The New Zealand-China Free Trade Agreement was signed between China and New Zealand on the 7th April, 2008 and was the first such agreement ever to be signed by China with another developed country.
Internally the business community consists mainly of small operators, 71% of them sole traders and 19% employing between 1 and 5 people.
Technology, media, and the arts are all growth industries and New Zealand has earned international acclaim for its digital effects and film productions.
The biggest city in New Zealand, Auckland, has a population of one and a half million out of a total of 5 million. Both Christchurch and Wellington regions have a population of about 400,000.