7 October 2014

The majority of voting New Zealanders appear to have been persuaded that the economy is being satisfactorily managed and that “more of the same” is more attractive than policy alternatives. That was the perspective reflected in the Global Competitiveness Report released a fortnight before the election. Economy watchers were heartened last year when New Zealand ranked among the top 20 for the first time since the survey, compiled annually by the World Economic Forum, began. And this year the rating improved. New Zealand is now ranked 17th – up eight places since 2012.

A reason why emigration has slowed, fewer New Zealanders are attracted to Australia, and there is less inclination to stay once there, may be explained by the declining comparative competitiveness of Australia. It is now 22nd in this survey compared with 15th place in 2012.

The data is collated into a series of 12 pillars. New Zealand is the World leader in the institutions pillar. Trustworthiness underpins the weight that can be given to these indicators which, in turn, are incorporated in numerous other international survey ratings. The New Zealand Initiative which helped collate the data puts New Zealand’s advantage down to its institutional strengths and the wellbeing of the education, health and labour sectors. It recognised that investments in things like the rule of law and property rights are paying dividends now. “The results can be seen in our high rate of GDP growth.”

The  Worldwide Governance Indicators are due for publication shortly.  If the movement in this year’s Global Competitiveness Report is replicated, then the trend may result in a ranking improvement and  New Zealand once more being among the half dozen countries placed in the top 10 on each of the six governance indicators.